Shropshire Council chiefs branded 'immoral' for holding on to £511,000 town and parish council grants

A controversial plan to withhold council tax support grant payments was approved at a full meeting of Shropshire Council – despite an outcry from town and parish councils across the county.

Councillor Roger Evans, leader of the Liberal Democrat group, said the decision was "immoral", while several councillors said it was unfair that the parish councils did not get the grants they were expecting.

But council leader Keith Barrow and chairman Malcolm Pate both spoke out in support of the plans, insisting town and parish councils had to "share some of the pain".

The proposal was passed by 43 votes to 23 at yesterday's meeting at Shirehall.

It comes despite Local Government minister Kris Hopkins writing to all billing authorities, including Shropshire Council, urging them to pass on the grants.

Councillors also agreed the authority's budget for the coming year. It includes efforts to make millions of pounds of savings, but there will be no increase in council tax for the sixth year running.

Councillor Barrow, who said the authority was in the second year of a three-year saving plan, warned: "If we think times are hard now there is more pain to come. We had to find about £87 million of savings, now there is another £80 million to find."

The most controversial part of the meeting was the discussion over council tax support grants. Councillor Andy Boddington said: "In future, town councils like Ludlow will be asked to take on more services and facilities from Shropshire Council. For that to happen, there must be mutual trust between the unitary council and local councils. That trust was severely damaged today."

Councillor Jean Jones said Broseley Town Council would lose £20,000 because of the decision. "You are hitting communities with the greatest need," she said.

Councillor Hannah Fraser, who represents the Abbey ward in Shrewsbury, said: "It is real hypocrisy for this council to keep council tax at zero when parish councils are having to increase their precepts because they will not receive this grant.

"As a unitary authority I feel Shropshire Council is acting like a parent who chooses to starve its children."

But Councillor Pate said: "It is not unfair for parish councils to share some of the pain. Unlike Shropshire Council, parish councils do not have any restraints on raising their precepts."

There was a suggestion from Councillor Pauline Dee, leader of the independent group, that more funds should be spent on the roads while several councillors said the most vulnerable residents would suffer from the budget cuts.

Councillor Barrow said: "We have heard nothing constructive, no alternative budget – nothing but sniping. The biggest parish council precept is £20, that is 6p a week."