YORK’S libraries are set to be put under the control of a social enterprise as city leaders say their running costs must be cut by £450,000 over the next three years.

Proposals for a community benefit society to operate the city’s libraries and archives from next April, which City of York Council says will be the first in the UK, will be discussed by the Labour authority’s cabinet next week.

If approved, it would have a five-year deal and be eligible for tax breaks, being one-third owned by staff and two-thirds owned by the public.

The council says the “groundbreaking” move would ensure libraries stayed open despite budget cuts. However, the council’s Liberal Democrat group claims staff are worried about the “outsourcing” arrangements and unions are against the plans.

The enterprise is expected to be called Explore Libraries and Archives Mutual and able to save £20,000 a year on VAT.

All libraries and staff would be transferred to the new service. It will have a £250,000 five-year budget for repairs, £111,000 less than surveys showed needs to be spent on libraries apart from York Explore, and officials said bridging this gap will be a priority.

Membership will be open to anybody over 16 who supports its aims, and each member will pay £1 for a share giving them voting rights and the opportunity to join its board.

Library membership will remain separate and free.

Coun Sonja Crisp, cabinet member for culture, said: “Our public consultation showed us that residents’ biggest concern is the libraries stay open and this groundbreaking plan, which is winning national acclaim, aims to do just that.

“Not only will it secure the service, it will offer the best possible route for continued improvement.

“There will be paid, professional staff, on whose expertise and enthusiasm we will continue to rely, at each library.”

Lib Dem councillor Nigel Ayre said he was “extremely worried” about the changes, which would heighten the prospect of future library closures and cuts to jobs and opening hours.

He said: “At the same time as outsourcing libraries, Labour are cutting the budget by £450,000 – there has been no proper public consultation on the changes and we know staff have concerns and the UNISON union remains opposed.”