THE breakaway of Sheet village from the rest of Petersfield could have a serious effect on the finances of the town council, it was claimed last week. The chairman of the town council's finance and general purposes committee, Bob Ayer, told the annual town meeting: "Perhaps our biggest challenge to be faced in the coming year will be the financial consequences of a breakaway Sheet." George Watkinson, who has been one of the members representing the town council at Sheet "UDI" meetings over the last year, said he was currently in the dark about the state of the proposal. He said the Sheet Village Association had carried out a survey to see if the proposal was viable and identified an area which villagers wanted to call Sheet parish. This information had been passed to East Hampshire District Council, where officers have been asked to calculated how many parishioners there would be and how much council tax the new Sheet parish council could levy. "Until that information comes back, I cannot say what the financial effect will be on the rest of Petersfield," said Mr Watkinson. But he warned: "If Sheet parish is created out of the area Sheet villagers are suggesting, then yes, I foresee an increase in council tax for those people remaining in Petersfield. If the area is slightly smaller I see it balancing out, but I am afraid it's a case of 'watch this space'." Town mayor Vaughan Clarke pointed out that he and Ken Hick currently represented Sheet, and that area was one-sixth of the total Petersfield Town Council area. The boundaries being proposed for the new Sheet parish, he said, represented half of those two wards and amounted to just one-twelfth of the present town. But Mr Watkinson said the proposed area generated 18 per cent of the current town council precept money. Mr Ayer said the proposed Sheet parish boundaries would result in the loss of one staff asset - the caretaker at Sheet Village Hall. He told the meeting: "This is potentially going to be difficult for us if it happens." Brian Dutton assured townspeople that there would be a public meeting in the town once the details of the proposed Sheet breakaway were known.