FINANCE chiefs across Lancashire were today studying the Government's announcement on subsidies to local authorities and how they will affect council taxes for the coming year.

A total of £44billion is to be handed out to councils in 2001-2002, a seven per cent or £3billion rise on last year's figures, and local government minister Hilary Armstrong said she expected most authorities to set a lower council tax increase this year.

Blackburn with Darwen will get £116.622million from the Government, with a spending ceiling of £141.380million, just around £21,000 extra above the figures suggested by the Government last November, and an increase of 2.4 per cent over last year. The council has to raise the difference through council tax to fund the services it provides. Gail Barton, executive member for resources at Blackburn with Darwen Council said she was "not happy" with the settlement, but pledged to work hard to keep council tax increases down.

She said: "In Blackburn we are not excessive with council tax. We are responsible and reasonable. We have not got a record of wacking big increases and we are not going to start now.

"But you have to set that against what we have achieved. You don't get good reports like the Ofsted one without investing in services."

Other East Lancashire councils also learned how much they would be getting from the government. Burnley is to receive £9.132million, Hyndburn £6.949million, Pendle £7.433million, Rossendale £4.687million, and Ribble Valley £2.684million.

But in the Ribble Valley, where they received an increase of almost seven per cent, the council's director of finance Marshal Scott said he was "pleased" with the settlement.

Mr Scott said: "Because of that we think we can set a council tax increase of three per cent next year for our share, although Lancashire County Council account for 80 per cent of our total council tax bill. Hopefully they will set a reasonable increase too."

Nick Aves, director of finance at Burnley Council, said the figures were "disappointing for Burnley", which also has a large proportion of its council tax set by Lancashire County Council. He said although the increase was above inflation when extra burdens placed on the council were taken into account it was not enough. He added: "It's too early to say as far as council tax is concerned, we have just started a consultation exercise with our Citizens Panel."

A spokesman for Lancashire County Council said there was little difference in the figures announced by Hilary Armstrong this week compared to those released for consultation last November.

The spokesman added: "The council tax effect of the budget of £932.321million proposed at the finance and general purposes sub committee on January 25 remains unchanged at a 3.5 per cent increase over last year."