Council tax is to increase for the first time in three years.

Residents will pay up to £35.25 more a year under Croydon Council plans to raise its share of the tax by 1.85 per cent, although tax bills will only rise by 1.2 per cent if the Greater London Authority approves a cut in its share.

Councillor Mike Fisher, council leader, said the increase was being levied because it would add £1.3m to its budget and help pay for new school places and homes.

He said the move would protect frontline services in the wake of 22 per cent cut in central Government funding over the last years.

The Government this year cut incentives offered to local authorities who freeze council tax from a 2.5 per cent grant increase to one per cent.

Coun Fisher said: "Every year it is a balancing act between making sure that council tax is affordable for the public, taking into account various offers that are on the table from the government, and obviously protecting much-needed frontline services.

"We've considered very carefully the offer from central government but on this occasion we have decided the right thing to do to protect frontline services is actually to have a modest increase in council tax.

"I think to protect investment in schools, school improvement and a whole range of council services that is an investment that most local taxpayers will be prepared to fund."

Band D households will pay an additional 34p a week - £17.56 a year - if both Croydon Council and the GLA approve their plans.

Councillor Tony Newman, Labour group leader, branded the rise "a betrayal" and promised opposition councillors would vote against it.

He acknowledged that the borough had been stung by £30m reductions in government grants, but argued the tax hike would not have been necessary if the council had not invested millions in its new headquarters.

He said: "We voted against spending all that money on new offices so we would not have been coming from this position."

The full council will vote on the tax rise on Tuesday, February 26. Any increase above 1.99 per cent would have triggered a referendum.

The GLA will decide whether to approve a tax cut today.