TEST Valley civic chiefs has voted to hike council tax for the second consecutive year.

The authority's cabinet agreed on Wednesday to raise its yearly charge by 3.8 per cent this year, with residents in Band D properties set to see their bill jump from £131.41 to £136.14 in April.

Test Valley borough councillors estimate this will bring in an extra £340,000, with TVBC expecting to rake in a total of £6.4million in tax as a result of the rise and the increased number of houses in the borough.

The latest hike, which is the second consecutive £5 rise from TVBC, is above the two percent threshold needed to trigger a public vote.

However TVBC is allowed a maximum rise equivalent to £5 for Band D properties, due to its status as a "low tax" authority.

Addressing the need for a rise, a report to the council's cabinet on Wednesday suggested cuts to government grants were to blame.

The report said the council will draw on its New Homes Bonus reserve to balance its books.

It added that the council should also "take the opportunity" to implement a precept rise, with the government not offering a council tax freeze bonus this year.

Thus, it was given the thumbs up by cabinet and will now go before full council next Friday (Feb 24) where councillors will then make the final decision.

However the decision to raise tax for a second consecutive year has drawn criticism; but the council says it has explored other ways of raising revenue as well as taking steps to reduce its own costs.

The authority says it has saved more than £10million since 20008 and has proposed revenue savings of more than £500,000.

The majority of these latest savings come from staffing changes, including redundancies and not replacing vacant roles.

The council also hopes to generate an extra £900,000 of income this year, including £686,000 from its new project enterprise scheme.

The scheme involves the council purchasing property and land, which they rent out for a profit.

One major increase in revenue has been the additional £1.7million the council anticipates it will bring in by 2020 from its new leisure management contract, recently awarded to Places for People Leisure.

As previously reported, the council suggested in January that it would need to make £1million pounds of savings by 2020 to balance its books.

However, the council says this expected deficit has now been reduced to £220,000 due to the government's new business rates retention scheme and the impact of the new leisure management contract.