Councillors agreed on Monday that the council would spend more than £460,000 on its services over the next financial year – an increase of £83,628, just over 22 per cent, on the previous year. This equates to an annual charge of £82.35, or £1.58 a week, for a band D property compared with £70.59 last year.

After the meeting, deputy town mayor Cllr Mick Jefferys said: "We did not make the decision lightly but we hope in the end we will be giving the people of Newmarket value for money.

"The new sports pavilion on The Severals will be coming on stream this year and that has incurred some cost for us.

"The saga of the memorial hall has been going on for 10 years and now we think is the right time to get on with the improvements and make certain the people of Newmarket have a hall they can be proud of.

"We are going to create employment through the refurbishment and we can take advantage of building costs being competitive."

The council has taken out a public works loan totalling £1 million to pay for the refurbishment – £500,000 in 2010/11 and £500,000 in 2011/12. The remaining £200,000 it hopes to raise through grants and other funding.

Forest Heath councillors are being recommended to approve a three per cent rise in their council tax demand – £4 a year for band D tax payers. The Mildenhall-based authority, which last year announced it was facing a £4 million black hole in its finances as a result of the recession, has not ruled out compulsory redundancies in its work force to help balance its books.

"We have had to take some tough decisions and have cut budgets by making sure our services offer real value for money," said council leader Geoffrey Jaggard.

"We will continue to make further efficiencies and look for opportunities to generate income."

Financial pressures faced by the council include a loss of interest on investments made using the cash it received from selling off its council housing stock to the Kings Forest housing association.

Two years ago, that brought in more than £2 million a year. Now that is down to less than £1 million.
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Lower levels of new building across the district has seen a 50 per cent drop in income from planning and land charges and, for the third year, the government grant to the council is below the rate of inflation – just 0.5 per cent above last year's amount.

Suffolk County Council's tax demand is set to go up by 2.4 per cent – 50p per week for a band D property.