HOUSEHOLDERS across the Bordon area look likely to face big increases in their council tax bills next year.

After two years of modest 2.5 per cent rate rises in line with inflation, council tax payers could now face rises of between seven and nine per cent.

Much of the blame lies with a shortfall in government grant support and plummeting interest rates, which have cut income to councils.

Some councillors believe that parishes may also be paying the price of keeping their precepts too low for the past two years.

The ruling Tories at East Hampshire District Council had promised a balanced budget and tax rises keeping pace with inflation.

But last week shell-shocked East Hampshire district councillors heard their government grant had plummeted £122,000 lower than expected.

And Hampshire county councillors said their governement grant had done little to alleviate spending pressures. They warned that tax bills would have to rise to pay for vital services.

Whitehill town councillors are due to unveil their budget at meeting of the full council on Monday.

Bramshott and Liphook parish councillors look set to ask for a 5.69 per cent rate rise for average band D homes.

Although they are due to ask for a massive 9.6 per cent increase in their precept, rising from just over £147,000 to £161,607, the parish tax base has increased which will soften the blow for individual householders.

This means that the precept increase will be shared among more homes, lessening the amount paid by each band D home to £46.79.

East Hampshire district councillors will probably be forced to sacrifice planned £144,000 contributions to the newly-set-up fund for community projects to keep tax bills down.

At a meeting of EHDC's cabinet last week, business and economic director Eric Norman also warned that the council's investment income was estimated to fall by £170,000 because of rapidly-reducing interest rates.

Finance portfolio holder Ferris Cowper told the meeting a zero donation to the community fund should not be misinterpreted.

There was around £300,000 still unspent which was available for community projects.

"Although next year we may not make a contribution, we can still issue grants for community initiatives and, based on applications so far, this money could comfortably take us through this year."

Leader of the Liberal Democrats Teresa Jamieson told The Herald: "The community is paying the price of the Conservatives sticking to old strict policies on the council tax.

"The government has reneged on its promises and is giving all of the Hampshire councils a minute rise in support grant.

"They expect councillors to increase their tax bills by six to eight per cent to compensate.

"We are hit locally twice, as bills will go up and Conservatives have said the new community initiatives fund will be frozen."

Mrs Jamieson added: "Liberal Democrats supported this very new fund to help local projects and groups and we are concerned that it has become the easy target."

Figures at East Hampshire District Council are currently being re-examined in the light of the shortfall in government grant.

Final tax bills will not be known until early next year.

Hampshire County Council leader Ken Thornber said he was disappointed that the government grant did little to address the county's problems.

He said that to maintain Hampshire's current standard of services, council tax payers could be facing increases of between eight and nine per cent.