Havering Council is set to increase council tax for the coming year by the maximum amount it can raise.
The cash-strapped town hall will raise the levy by 4.99 per cent – the highest it can go without a public referendum.
For the average Band D resident in the borough, that will mean an extra £9 in their monthly bills.
The borough saw similar tax rises last year as the council struggled to balance its budget.
Council leader Ray Morgon said: “Despite constant lobbying and meetings with government ministers and civil servants, we have not been given the support we need to bridge the gap from last year.
“Over the years, we have seen a substantial reduction in government funding and, sadly, it has been local residents who have had to make up a large part of the deficit."
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After a challenging year, Havering will be entering the 2025/26 financial year with a budget deficit of around £71million, revised from £75m. That is more than double last year’s shortfall of £35m.
Last February, the town hall was saved from effective bankruptcy by a £32.5m bailout from the central government.
Cllr Morgon said the council once again “had no choice but to apply for another government loan,” this time of £71m.
In December, Havering was allocated £40m in funding as part of a nationwide settlement for councils.
That constituted a £10m increase overall from last year, but the leadership says it simply will not be enough.
The town hall is also set to increase its rents for tenants by 2.7pc, and its fees and charges will go up by 2.7pc.
The council says it consulted 600 residents and just more than half said they would pay 5pc or more in council tax. Around 41pc said they do not want to see an increase.
Cllr Morgon added that the town hall “won’t grind to a standstill”.
He said: “Services will continue for residents despite the budget gap. Staff and bills will still be paid.”
The new council tax scheme was due to go before cabinet for approval on Wednesday (February 5). It will then be given the final stamp at a special council meeting at the end of the month.
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