The county council that said it had to up tax by 15 per cent after crying poverty ended the year with more than £6m unspent, its cabinet heard.

Surrey County Council’s Conservative administration had proposed a referendum on whether to increase council tax by 15 per cent after blowing its budget by £15million last year and having government grants cut by £170million over the previous five years.

From December: Surrey County Council forced to dip into 'largest ever use of reserves' to address £15 million overspend

From January: Surrey County Council leader confirms move to seek largest council tax hike in the country of 15 per cent

In a report into the council’s finances which went before the cabinet on Thursday (April 27), council officers admitted “one-off measures don’t address the fundamental issue of service overspend particularly in social care”.

The council had cut £66.4million from its budget – affecting services including adult social care – against a target of £82.9million, the cabinet also heard.

It still needs to identify up to £11million of additional cuts to balance its budget for 2017/18 and move towards a sustainable budget for future years, council officers wrote.

Council leader David Hodge heralded council officers achieving a £6.7million underspend and a “balanced budget” at the meeting, as the council recorded a £29.2million improvement in its forecasted position from last year.

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But Liberal Democrats leader Hazel Watson (pictured above) called on central government to increase funding to local authorities.

From March: Surrey County Council plans to cut millions of pounds from frontline services in face of Conservative austerity

“With £93million of cuts planned for this year, there is much more financial pain to come under the Conservative administration,” she said.

“The Conservative administration should be more honest about the parlous state of the council’s finances.

“Robbing Peter to pay Paul is not a sustainable financial policy for the unrealistic savings’ targets for crucial services. What is needed is proper national financial help and more realistic financial planning.”

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Pic credit: CIPFA

She also pointed to a council-commissioned report by accountants CIPFA which concluded the council’s budget was “dependent” on winning the mooted referendum – which was scrapped in February.

Inspectors added that the council’s financial plans are “not robust” and that it risked “becoming financially unsustainable unless it takes corrective action to adjust service levels and the cost of its operations to live within available resources”.

“The £6.7million underspend hides the very serious financial weaknesses that Lib Dem county councillors and CIPFA identified in their report,” Cllr Watson said.

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Cllr Hodge (pictured above), leader of the council, said demand for the council’s services were due to persist into the current financial year and had so far prevented it from reaching its savings targets.

He said: “The shortfall on planned efficiencies means these underlying pressures persist into 2017/17 and will continue to have a detrimental impact on the council and its medium-term financial position, which is not yet completely sustainable.

“Given the gravity of our situation it is vital that members and officers continue their actions to identify and implement ways to address the ongoing issues affecting the council’s financial sustainability for 2017 and subsequent years.”

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