Senior politicians in Watford have rejected proposals to sharply increase the price of parking permits in the town.

At a meeting last night, the borough council’s cabinet agreed a motion to drop a proposed hike which could have seen fees raise by up to 30 per cent for residents in Controlled Parking Zones (CPZs).

The move came after the plans by council officers ran into opposition in the borough’s advisory budget panel committee last year.

A few Liberal Democrat councillors on the committee had expressed some support for an increase in November before later recommending that no increase be made this year.

Yesterday, Labour Councillor Jagtar Singh Dhindsa, a vocal critic of the increase an chairman of the budget panel, said the cross-party budget committee felt rejecting a rise was the “right thing to do”.

At previous meetings he had argued it was wrong to hit households with extra cost in a recession when many were struggling.

Dorothy Thornhill, the borough’s Liberal Democrat elected mayor, said the council would need to undertake an in-depth study of customer satisfaction with the current scheme before making any changes.

But she warned the situation could not be left as it was indefinitely as the scheme’s finances are deteriorating.

“At some point we will have to look at the whole thing,” she said.

Plans to increase the CPZ charge emerged in November after the scheme’s financial reserve, which is used to pay for maintenance and set up new zones, had declined to around £400,000.

Council officers argued that it could be exhausted by 2014.

Part of the reason for the shrinking of CPZ revenues was that fewer fines were being handed out and new schemes had been set up in less congested areas such as Cassiobury.

Residents living in a CPZ currently pay £20 a year for a permit for their first car, £40 on a second. Councillors were recommended to raise the charges from between 10 per cent and 30 per cent, raising them possibly as high as £26 and £52.

The council argued that charges had not risen since 2005 and even with the increase, this would still be far less than other areas like St Albans where drivers pay £38 a year for a first car, £132 for a second and £288 on a third.

The mayor first raised the issue of the scheme's declining reserve in September and said it was not an issue the council could ignore.

At last night’s meeting Councillor Iain Sharpe, the Liberal Democrat portfolio holder for planning legal and property, said he felt it was important CPZs financed themselves.

He said: “It has been the policy for the CPZ since it was brought in that it should be self-funding and the reason for that has always been unanimously accepted.

“People should not pay council tax to subsidise the CPZ otherwise people are paying tax to be disbarred from being able to park in certain roads.

“It is a service and people are paying for enforcement to stop people parking on their roads.”

Steve Rackett, the leader of the Green group, voiced concerns that the people in current zones could end up paying, through the scheme’s reserves, for new CPZs to be set up in areas such as Callowland and Oxhey.

He suggested residents who wanted schemes set up in their area should shoulder the initial start-up costs themselves.

Councillor Sharpe responded saying the council had consulted in Oxhey and most of the area, with the exception of a few roads, did not want a zone imposed.

At the end of the discussion the four members of the executive voted to recommend the proposed increase not be included in the budget.