COUNCIL tax bills in East Lancashire look set to rise next April by six per cent - but the news is not as bad as was first predicted.

Finance directors across the area have given a cautious welcome to Deputy Prime Minister John Prescott announcement in parliament yesterday.

Tax bills in Blackburn and Darwen are likely to increase but council leaders are predicting cuts in services are on the way.

The town hall will take complete control of services and spending in the borough from next April and the signs are around £7 million will have to be axed from the budget.

Finance chairman Gail Barton said: "The news is slightly better than we expected but extremely difficult decisions will still have to be made.

"There will be a modest increase in the council tax but the decision was still slightly better than expected."

A six per cent increase in council tax for Blackburn and Darwen would mean bills would be: Band A £589.08, Band B £686.9, Band C £785.44, Band D £883.63, Band E £1079.99, Band F £1276.36, Band G £1,472.72, Band H £1867.24

Borough councils in East Lancashire were also given a better deal from the Deputy Prime Minister than was being forecast.

But the final picture will not become clear until Lancashire County Council works out its share of the bill.

Hyndburn's share of the council tax will actually fall by 8.6 per cent or around £22 on a band D property.

Director of finance Dan Sherry said: "At first sight the settlement is a mixed bag for Hyndburn. "We have been given extra money and our spending has been increased but the council has been capped at the same level as last year."

Ribble Valley Council has also been given extra money to spend. Director of finance Marshall Scott said: "The news is much better than expected we will have to sit down and work out what it will mean for the Ribble Valley.

Local Government Association chairman Sir Jeremey Beecham has given a lukewarm welcome to the settlement and called for the Labour Government to end spending capping on councils.

He said: "Obviously we are disappointed that the Government has not been able to fulfil its manifesto commitment to remove capping in this settlement.

"But the slight easing in capping is a small step in the right direction."

In Burnley, Pendle and Rossendale it was again a question of "Cap That!" as councils were told they could spend no more next year.

Pendle finance manager, Tony Morris, branded it a sweet and sour settlement - with more grant help from Government the sweetener, set against the bitter pill of a clampdown on spending for another year.

Burnley finance spokesman Nick Aves said another year of capping was a disappointment, with the council expecting some easing of the pressure on services.

Finance bosses reckon their 20 per cent share of the council tax budget would go down next year, but the saving would be wiped out by expected increases in the lion's share of the demands set by the county council and police authority.

All three towns expect council tax to rise next year, but they described speculation of an average seven per cent rise as "pure guesswork."

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