Dorset Council's budget for next year could have been worse – although residents will still face a three per cent increase in their council tax and a continued squeeze on services.

The authority has been helped by getting a larger than expected settlement from the Government, although only for one year.

It will also see extra income because of a growth in the council's tax base, related to population numbers, although this will only bring in an extra £400,000.

Residents, and visitors, are also expected to face an overall increase in fees and charges of around 2.5 per cent, although car parking and some other services will see bigger rises.

Dorchester councillor Andy Canning argued at a place and resources scrutiny meeting on Friday for a bigger increase in fees to keep in line with inflation, which is expected to rise to four or five per cent during the coming year.

Fees and charges at the council bring in around £46.5m a year.

Councillors have been told that extra savings are also anticipated from what the authority describes as 'transformational changes' – where it continues to amalgamate services from the previous local councils.

Executive director for corporate development Aidan Dunn says the council is still facing uncertainty as it heads into the next financial year – with pressures from rising fuel prices, increased demand for adult and children's services, and the risk of another lockdown, which could be coupled with bad winter weather.

Budget pressures will also come from the Government-imposed increase in National Insurance contributions while staff unions are currently asking for an above-inflation increase in pay which, if not met, could result in industrial action.

Mr Dunn says the council is projected to have a 6.1 per cent increase in its income next year, an additional £19.2m of spending power, which will partly be funded by council taxpayer paying a three per cent rise in council tax, pushing the 'average' band D household payment for the council's share up by £1.02 per week. Figures for police, fire and rescue and town and parish councils will have to be added to this for most residents.

Ten million pounds is being added to the council's climate change capital budget next year with the authority also in the process of recruiting a new director to lead council climate change work and oversee the £750,000 revenue budget for the area.