A planned district merger in Devon has collapsed.
Councillors in West Devon BC voted down the idea, although those in neighbouring South Hams DC supported it.
A joint statement said: “Councillors from both authorities now need some time to regroup and talk to their members before making any further statements about what this outcome means.”
Voting was 18-13 against at West Devon and 19-8 in favour at South Hams. Both councils have Conservative majorities.
The merger had been proposed from April 2019 as a means to save £500,000 a year through efficiencies.
South Hams and West Devon both already share management and services and merger was intended to help to close projected budget gaps of £800,000 and £1.1m respectively.
But the idea met public opposition over council tax equalisation and the perception that South Hams would have to bail out West Devon’s borrowings.
Responses from all channels of a public consultation showed 86% opposed the merger in South Hams and 55% in West Devon.
South Hams leader John Tucker (Con) responded to public concern in September with a statement in which he said: “To be absolutely clear, West Devon Borough Council are not in the red. We are not bailing them out. Our working relationship benefits both parties. By working with West Devon Borough Council we have and continue to, save millions of pounds in operating costs every year.”
He said while West Devon already had borrowings of £2.1m, future commitments by both councils would see them with almost identical borrowings of just over £6m by the end of the next financial year.
Council tax for residents in South Hams would have needed to increase under the merger by £62.97 a year to equalise with West Devon.
This is the second time a major integration step between the two councils has come to grief.
Last February they conceded that a plan to put all staff into a standalone company would have to be abandoned after a report found it would take too long to repay the set up and pensions costs.