The average council tax paid in Hartlepool is now the 220th lowest out of all 319 local authorities in England.

Senior councillors say the budget package agreed last night will also protect vital front-line services.

While some other authorities across the region and across the country are looking at smaller increases or even freezing council tax, some councillors have stressed that anything less than 2.5 per cent would have led to many crucial services being axed.

Labour group leader Jonathan Brash said any moves to set a lower council tax increase could have led to the closure of a community service or building such as a library or art gallery, or the loss of a service like Dial-a-Ride.

He added that a lower rise could have also affected the budget for social workers who support some of the most vulnerable people and the loss of the departmental budgets required to support schools.

Coun Brash, who represents Burn Valley ward, said: "It is likely the aforementioned cuts would have still only reduced the increase by around half.

"To get down to, say, zero per cent would have cost around £1m and meant even deeper cuts and the loss of many non-statutory services."

He said the 2.5 per cent increase protects such statutory services as;

Mental health services where there has been an increase in the number of community based packages associated with Aspergers and Autism requiring additional funding of £155,000.

Intermediate care provision for older people as well as the provision of transitional beds. These have been subject to greater pressure and require a further £190,000 to meet the needs of the older population.

An extra £195,000 to help support Hartlepool young people with learning disabilities.

Support to local businesses through tough economic times using discretionary business rates hardship relief.

Full council funding for the hospital bus to continue.

Coun Brash added: "We are supporting a budget that invests in the things Hartlepool needs, avoids damaging cuts, makes sensible efficiencies and has the lowest council tax increase in our history.

"Ongoing, recurring savings through business transformation will continue to be made with £2.5m this year, rising to £3.8m next year and reaching £6m by 2013-14.

"We do all of this with the lowest council tax increase in the history of the council tax with the 2.5 per cent the same as the increase in the state pension and for a band B property equates to some £2.64 a month more or 66p a week over 12 months."