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DUBLIN city councillors have approved a controversial budget that will cut commercial rates but slash capital spending in half.

Businesses can breath some relief today after councillors agreed to reduce rates by 1.7pc -- but this is still less than the 2pc cut that had been demanded by city shops.

Despite angry objections, council officials said the budget will also see the definite privatisation of its bin service.

It has been estimated that such a move would save €60m over the next five years. Waivers for low income households will continue to exist throughout next year.

However, residents of senior citizen housing and flat complexes will have to pay €1.50 per week for their waste collection service.

Council officials said they will increase the budget for water supply and sewerage infrastructure. And an estimated €1m is to be put towards maintaining flood risk areas and the provision of a bulk waste collection service. The increase includes funding for the controversial Clontarf flood defence plan and flood relief works on the river Dodder.

There will also be an expansion of the Dublin Bike Scheme, which will see the number of bikes being increased from 550 to 5,000, alongside 300 cycle stations.

Meanwhile, local councillors strongly criticised cuts to social housing, which has fallen from €1.14bn since 2009 to €353m for the next three years.

They argued that there is a need "now more than ever" for social housing funding.

However, council officials said one-third of the budget will be allocated to the Ballymun regeneration scheme over the next three years, while the remaining €236m will provide for further housing needs throughout Dublin.

City Manger John Tierney explained that the number of housing units that will be acquired under the new budget will be fewer than 175, despite the purchase of 129 properties this year for those on the housing waiting list.

It was also outlined how roads throughout the capital will be allocated €2.5m, which will finance work carried out under the council's roadway resurfacing programme.