COUNCIL TAX payers in Petersfield are being warned to expect massive 15 to 20 per cent rises following devastating news on government funding to Hampshire county council this week.

It will mean an increase of more than £130 on the average tax bill in Petersfield next April, just to maintain services.

Last week Hampshire County councillors received the news they had been dreading - that their funding from central government was going up by just 3.7 per cent. This means there will be a £45m shortfall in the county councilÕs budget.

And council leader Ken Thornber warned taxpayers: ÒWithout a hefty council tax rise, the council would be looking at dramatic cuts to services to make up the grant loss.Ó

Hampshire police have already painted a black picture for tax payers, saying they will either have to reduce policing or put up their share of the council tax by at least 20 per cent.

There was better news for East Hampshire District Council on Wednesday when the government announced that they would receive a 3.3 per cent increase in funding.

EHDC leader Elizabeth Cartwright told The Herald that although this was less than the 5.9 per cent national average it would mean the council would be able to see through its promise of a balanced budget and a tax rise in line with inflation at 2.5 per cent.

The only unknown factor left for Petersfield council tax payers is how big a slice of the cake Petersfield town councillors will want.

They are still deciding their budget behind closed doors and were due to hold their final secret debate last night (Thursday.)

Town councillors will make their final decision on their budget in public at a full meeting on the council on January 6. They are known to be facing some tough decisions which are likely to mean unwelcome news for some organisations in the town, unless councillors are prepared to make substantial increases in their precept.

Although their share of the tax cake is tiny - last year average taxpayers paid £45.53 to the town compared with £734.67 to the county council, councillors are unlikely to put their bill up. But spending pressures, including the need to carry out an expensive asbestos survey of all their buildings, could see it rise by as much as five per cent.

The biggest shock will come from Hampshire County Council and county leader Mr Thornber has been urging colleagues in other south east counties also affected by the governmentÕs overhaul of council funding to join him in demanding a meeting with the deputy Prime Minister to argue against the settlement.

He said the 3.7 per cent rise fell far short of the cash needed just to maintain current services, let alone the added costs of inflation, committed pressure such as landfill tax and other demands.

ÒMinisters accused us of scaremongering when we warned that Hampshire faced massive grant losses,Ó said Mr Thornber, Òyet what we see now is ministers scaring the people of Hampshire because of their notion that our taxpayers should pay more towards their services than people in the north.Ó

Simon Hayes, chairman of Hampshire Police Authority said: ÒIt is a sad state of affairs that we are losing funding because Hampshire and the Isle of Wight are safer places to live than many other areas of the country. We will now have to take the difficult decision of either reducing policing or increasing the police precept in the council tax by at least 20 per cent.Ó

Mrs Cartwright leader of EHDC told The Herald: ÒI am quite relieved with our grant. The 3.3 per cent is slightly more than we budgeted for, but it is still well below the national average of 5.9 per cent. We are able to keep our share of the tax bill to a 2.5 per cent increase.Ó

She said this was despite facing 3.5 per cent pay rises, one per cent national insurance and one per cent superannuation costs.

But she does not yet know what sum will be put into the Community Initiatives Fund this year.

Councillors had hoped to top it up by £112,000 next year. But at present it looks as though this figure will be cut to £47,000.

East Hampshire District Councillors are facing the added spending pressures of a possible increase of some £50,000 in members allowances and an increase in Bed and Breakfast payments following a change in Homelessness regulations which could amount to another £20,000.