EAST Hampshire District Council is facing a financial crisis unless it takes action now to deal with an estimated £750,000 funding shortage next year.

And councillors have been warned it could mean a bigger rise in council tax next year.

It could also mean a hike in car parking charges throughout the district, a re-think on concessionary fares and the councilÕs garden waste collection service, as well as a review of senior management staffing.

In a report to members of the councilÕs cabinet, head of financial services, Bill Price, asked councillors to increase this yearÕs revenue budget by £290,000.

In his report he said that it looked as though there would be another shortfall of £744,000 next year and asked members to look at proposals for a new financial strategy to take the council up to 2008.

ÒThe purpose of this paper is saying

we have a number of issues we need to tackle now, in preparation for next year,Ó said Mr Price.

What we are proposing is a number of ways of doing that,Ó he added, ÒWhat I am asking members to agree to is a package of proposals to address this shortfall.Ó

Mr Price reported that the spending shortfalls were predicted after looking

at several factors including the impact

of continued reduced investment earning and a possible cut in the level of support from central government.

And he warned that it was becoming increasingly difficult to keep to the councilÕs political objective of maintaining services at their present level and keep the council tax increase to within 2.5 per cent.

Councillors were told it was proposed to deal with the £290,000 shortfall this year by using £125,000 underspent in last yearÕs budget and find savings of £165,000 after another look at this yearÕs budget.

He said the money was needed after a rephasing of local plan expenditure, a reduction in income from land charge fees and the need to provide more homelessness payments as increase demanded.

But Mr Price reported the shortfall in 2004 to 2005 is of greater significance.

In addition, there was uncertainty over the future levels of government grant.

The district council tax has been kept to the governmentÕs inflation target of 2.5 per cent over the last four years. But in his report Mr Price warned: ÒIn the medium term it is now becoming increasingly difficult to comply with the councilÕs political objective to maintain services at their current level and keep council tax increase to within 2.5 per cent.Ó

The cabinet agreed to support proposals to deal with the three-quarters of a million pound funding shortage next year. They included a review of the garden waste service, the stopping of the architects enabling service, and reviews of car parking charges, concessionary fares and senior management staffing.

But Lib Dem councillor, Jerry Janes, said that services had suffered, that grass cutting had not improved, there had been problems with the waste collection service and travel concessions had gone down in real terms.

He added that the council should look at all service provision before it started cutting costs.

But leader of the council, Elizabeth Cartwright, said the council would be acting ÒirresponsiblyÓ if it did not investigate the options outlined in the report.