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Councillors in Newport have backed a new budget which supporters say invests in important services for residents – but critics say will cost taxpayers more.

Council leader Dimitri Batrouni, who heads the Labour group, said the new “bread and butter” budget “delivers what matters to residents across the city”.

Earlier mooted closures of libraries and community centres have been axed from the final budget, as has the proposal to scrap the Newport Matters newsletter.

A range of new investments are included, which Cllr Batrouni’s party said was down to a more generous funding settlement from their Labour colleagues in Westminster and Cardiff Bay.

That settlement meant the council could switch street lights back on, reopen some public toilets and repair damaged roads, he told councillors at a meeting on Tuesday.

Conservative members criticised proposals to raise council tax bills by 6.7%, however, with party group leader Matthew Evans saying residents “will still be paying more for less”.

Central government grants contribute around three-quarters of the city council’s core spending power, with the remainder mostly coming from council tax and fees charged for various services.

Cllr Batrouni said Newport’s extra government funding this year reflected the city’s status as the fastest-growing area of Wales – in turn adding to pressure on services for its youngest and oldest residents.

The budget includes extra funding for schools, homelessness action and social services, he said, adding: “This is the most money and the best budget… this council has received in many, many years.”

Cllr Evans said councillors “will all be pleased to see some improvements” but told the meeting the previous switching-off of street lights and the closures of public toilets had happened under Labour’s watch.

He said Labour had “ignored” the public’s feedback on the draft budget, in which the majority of survey respondents believed the proposed council tax hike was “far too much”.

A 6.7% increase will mean billpayers in an average Band D property pay £100 more council tax this year – although the local authority contends most people face a smaller increase, because the majority of chargeable properties are Bands A to C.

Cllr Will Routley, a Conservative, noted the current Labour-run UK Government had increased employers’ National Insurance obligations and cut pensioners’ winter fuel support.

He claimed “residents can’t afford to pay the 6.7%” extra council tax.

Several Labour members challenged Cllr Evans’ claims about council tax, arguing rises had been unwanted but necessary due to Conservative austerity policies at a UK level.

“Who cut the funding? That was the Tories”, said Cllr John Reynolds, adding the council would “start to put some of the wrongs right” with the extra settlement money.

He said the 6.7% council tax rise would mean an extra £1.70 or £1.80 a week for many residents.

“It’s not even a cup of tea,” he told the meeting.

Fellow Labour councillor Deb Davies, the deputy leader, called the increase “affordable” and said Newport also runs a council tax relief scheme to support residents “in dire straits”.

Conservative councillor David Fouweather said he “can’t support” a 6.7% tax increase and told the council leader “you need to spread your butter a bit more thickly if you want to get the right results”.

But Cllr Batrouni said keeping council tax rises in line with inflation “would mean millions more” in required savings.

The budget was passed by a majority vote.