Surrey County Council said in December that because of inflation and other pressures the council might be faced with a shortfall of £60m, and had no option but to raise tax.

The council has put forward a budget of £884m for 2003 to 2004, which works out at an increase in council tax of 17.9%.

Councillors across the county will meet this week to agree the proposed new rates.

It is a tough decision, but this budget is the only realistic way to protect the most vulnerable and provide the necessary funding to schools Nick Skellett, Surrey County Council leader

Surrey County Council has blamed the government's new grants formula for the increase, claiming money has been diverted from the South to the North and Midlands.

It receives the lowest level of government grant per head of any authority in the country but faces the highest costs outside London.

The government has denied any agenda to shift resources from one part of the country to another and has guaranteed no authority will receive less grant than this year.

Leader of the council Nick Skellett, who is the Conservative councillor for Oxted, said: "I take no pleasure from proposing a high increase in council tax.

Frontline services

"It is a tough decision, but this budget is the only realistic way to protect the most vulnerable and provide the necessary funding to schools."

The rate for a band D Surrey property will be £851.49 - an increase of about £2.50 per week.

The council, which said it had opted not to make cuts to main frontline services, has budgeted for an extra £27m for education and £30m for social care.

Mole Valley councillors meet on Tuesday night and Spelthorne councillors will later this week to debate the tax rise.

Surrey County Council will then set out on Thursday how much more its residents will pay.