THE police and Dorset County Council today warned of a budget crisis sparked by shortfalls in Government funding.

Council staff have worked out that they will have £800,000 to spend on services after meeting £19 million of commitments for 2005 to 2006 - despite deciding to increase the budget by five per cent.

And Dorset Police Authority clerk Peter Harvey and Deputy Chief Constable Chris Lee warned of cuts in policing - including frontline services - when they met MPs in London today.

Mr Lee said: "The last thing we want is a reduction in frontline policing, but the Government should be warned that this is a very real possibility."

Dorset Police, which is the second-

lowest funded force in the country, says it needs a 5.7 per cent increase in funding from the Home Office to meet such demands as pay inflation, forensic services, technological developments and a 12 per cent rise in the cost of pensions.

But the force fears that the increase will be pegged at three per cent which, combined with low council tax rises, would leave them with a shortfall equivalent to the cost of nearly 100 officers.

Mr Harvey said: "The public are getting fed up of rising council tax and the Government is threatening to cap increases. This means that without at least 5.7 per cent funding from the Government cuts in police services may have to be made."

The county's cabinet has decided to explore an increase of five per cent in its budget for 2005-2006 but cannot say by what amount council tax would rise until it gets details of how much it will receive from the Government in its spending settlement in November. Officials say that there would only be £800,000 left from a five per cent rise to spend on services after meeting unavoidable costs of £14 million to cover inflation, insurance premiums, the capital programme and national pay awards, as well as £4.2 million set aside for schools.

Council leader Tim Palmer said the council again expected to be bottom of national tables in the amount it receives from the Government and that it would have to redirect the money in its system into areas of greatest need, such as elderly care.

The £19 million of service pressures also includes such areas as social services, road maintenance and libraries.

Coun Alan Havelock, resources portfolio holder in the cabinet, said it was too early to say what the council tax figure would be. He said that the council would receive an extra £3 million if the Government based its funding calculations on data on the 2001 census instead of the outdated 1991 figures.