FAMILIES in Newcastle will pay on average 5p a week more to the borough council from April.

Members of Newcastle Borough Council's ruling Conservative-Lib Dem coalition hailed an "historically low" council tax rise last night, as councillors voted to approve the budget for the coming financial year.

The 1.5 per cent increase will mean householders in the average Band D category will pay £176.93 toward the borough council in 2010 to 2011, compared to £174.32 in 2009 to 2010.

The increase – added to the precepts of Staffordshire County Council, Staffordshire Police Authority and Staffordshire Fire Authority – will mean that a Band D household in Newcastle will pay £1,450.99 council tax in 2010/11.

Council leader Simon Tagg told the full council that the administration had been able to keep council tax low by making efficiencies across the board.

More than £400,000 has been saved by "freezing" 16 vacant posts, while waste and recycling savings totalled £550,000.

Mr Tagg said: "We need to be more commercially oriented in these tough economic times. We have successfully frozen these vacant posts but we have also made sure front line posts have been filled."

The low council tax increase will mean the council will have to withdraw £468,000 from its reserves in order to balance the budget.

But Mr Tagg said this was the best option because interest rates were so low.

He said the savings meant there was still money to invest in improving services, giving as examples the new cemetery at Keele and the customer service centre at Kidsgrove.

Mary Maxfield, cabinet member for culture and active communities, said: "When this joint administration began in 2006, we wanted to be an excellent council providing first class services for residents. We are now on course to achieving those goals."

But Councillor John Williams, leader of the Labour group, accused the joint administration of profligacy, saying this had forced it to make cuts to services.

He said: "When the joint administration took control they inherited a fair-rated council, that was debt-free.

"That position has now been squandered. We've seen £2.5 million invested in the Heritable bank, that we still haven't got back yet, and the fiasco of the Sports Village that cost the council £300,000.

"Now we're losing these 16 posts. We're seeing a reduction in the capacity of this council."

After an hour-long debate, the Conservative and Lib Dem councillors voted to approve the proposed budget and council tax increase.