LOCAL councils are set to receive more than £760million in government cash for the coming year -- and government ministers say council tax increases should be lower than last year.

Blackburn with Darwen Borough Council will receive £116million from the government to provide local services, and Lancashire County Council will get £644million.

Local government minister Hilary Armstrong announced today the government handouts for all councils in England and Wales for 2001/2002.

She said the £44billion of government funding could lead to lower council tax increases.

The government has also targeted specific regions for extra cash, including those affected by the recent floods and areas of high deprivation. Overall there is an extra £3billion nationally for local authorities to spend on key services including education and social services.

Ms Armstrong said: "This year's settlement provides an increase of 7.2 per cent in total government grant and a 4.9 per cent increase in general grant. This is on top of substantial increases each year since 1997/98.Given these good increases in grant, I would therefore expect the majority of local authorities to be setting a lower Council Tax increase this year than last when the increase was 6.1 per cent."