Bankrupt Croydon Council has been given Government permission to raise council tax by a “staggering” record amount, it was announced on Monday.

Residents in the south London borough will see bills rise by 15 per cent from April - 10 per cent more than most other local authorities.

More than £230 will be added to the average household’s annual payment, which comes on top of the almost £40 hike by Sadiq Khan for City Hall’s share of the bill.

It means Band D homes will pay over £2,230 a year for their total bill.

Under current rules town halls can only increase council tax by 4.99 per cent this year without a referendum.

Croydon’s Conservative mayor Jason Perry said the government had given his borough special permission to raise funds “to get the council back on a sustainable footing”.

Thurrock and Slough councils also had requests approved to raise council tax by 10 per cent as part of the final local government finance settlement.

Mr Perry blamed the previous Labour administration, which left the authority £1.6billion in debt when they lost power last May.

Mr Perry said: “I know this is going to be difficult for people in Croydon, but without the proposed increase, the council would need to make a further £20m of cuts this year, putting vital services to vulnerable residents at risk.”

He added that extra funding would be made available for a council tax support scheme for the poorest residents.

Croydon issued its third bankruptcy notice in just two years in November after admitting it would not be able to balance the books without a Government bailout.

Croydon North Labour MP Steve Reed said: “Croydon Conservatives are planning to wallop residents with a staggering 15 per cent council tax hike in the middle of a Tory cost-of-living crisis - instead of getting fair funding from their own Government.

“What planet are they living on? Residents simply can’t afford this.”

A Government spokesperson said: “Given the exceptional circumstance in these councils and unprecedented scale of financial deficits in each council, the government has agreed to the requests.

“In line with their requests, Thurrock and Slough will be able to raise council tax by an additional 5% above referendum principles applied to other councils, and Croydon will be able to raise an additional 10%.”