The rise means Band D households would pay an extra £4.32 a year to Cannock Chase Council in 2021/22 compared to this year.
Their annual bill for services such as waste collection and park maintenance is set to go up from £221.32 to £225.64.
The proposed council tax increase was backed by Cannock Chase Council's cabinet members at their meeting on Thursday, January 28, and will be recommended to the full council for approval.
Cabinet members heard that the ongoing coronavirus pandemic was expected to lead to cost pressures of £1.1 million for the authority in 2021/22 – and result in a loss of £330,000 income.
The council’s head of finance Bob Kean said: “I think cabinet members are well aware of the financial issues we are facing. It is difficult to predict how long the impact of Covid-19 will be.
“We faced a deficit of £2 million in 2021/22 – that has been partially addressed by the Local Government Finance Settlement and an additional expenses grant in relation to Covid-19.”
Local authorities are required to set a balanced budget. Cannock Chase Council’s 2021/22 budget has been based on maintaining existing services, a cabinet report said, and also includes the running costs of the new cemetery due to open in Norton Canes later this year and the deferment of district elections which were due to take place in 2020 but put back until 2021 as a result of the pandemic
Council leader George Adamson said: “Cannock Chase Council is facing major financial problems because of Covid-19.
“Nobody wants to pay more for council tax but 1.95 per cent increase is a fairly small increase. It’s the minimum we can, with use of Government grants and reserves to cover the shortfall.
“We hold them for a reason and it’s not just raining, it’s pouring. It’s the time for us to use our reserves.”
Councillor John Preece said that garden waste collections would remain free for district residents however. In neighbouring Stafford Borough and South Staffordshire residents now have to pay an annual fee for the service.
Councillor Preece said: “This council hasn’t had to resort to charging for garden waste which a lot of other councils have been doing. It’s fortunate we are in a financial position where we haven’t had to resort to that and continue to have free garden waste collection.”