HOUSEHOLDERS in Dorset could face a ten per cent increase in their council tax bills next year.

Councillors have warned that unless government funding for the county increases, council tax is set to rocket to pay for local services.

The dramatic increase of five times the rate of inflation would see average Band D bills soar through the £1,000 barrier in Weymouth and Portland and West Dorset.

Weymouth and Portland Borough Council received the lowest percentage of 1.66 per cent increase in government cash hand-out in England last year for services such as street cleaning, providing play areas and rubbish collecting.

Kay Wilcox, the borough council's policy and resources committee chairman, said that unless the council gets a substantial increase in their Revenue Support Grant (RSG), which pays for local services, then council tax may have to be increased dramatically.

She said: "Hopefully it will not have to be as much as ten per cent and we can keep it to a five per cent increase.

"But if we don't get a substantial increase in the RSG and we want to be able to maintain and improve our services to the level we would like then there will have to be an increase in council tax bills by up to ten per cent.

"We hope to avoid having to do that.

"The government has promised a radical change for 2003/4 and Labour councillors want the new system to be easier to understand, but more importantly, to be fair to all councils, big and small, rural and urban.

She added: "These services can't wait until 2003 to improve, we need extra money from government in next year's grant."

And in an attempt to get the borough a fair funding deal from the government, councillors have enlisted the help of South Dorset Labour MP Jim Knight to lobby ministers for more cash.

And Mrs Wilcox is hoping that he will be able to help the borough and other small councils receive fair government funding.

She said: "As a Labour Group we have supported the Government's priorities of investing extra money in education, social services and the health service during its first term in office.

"Now we are calling for the services that are provided by the district councils to be properly funded by central government."

Families in West Dorset are also set to see an increase in their council tax of up to ten per cent.

Adrian Stuart, finance manager for West Dorset District Council, said that some hard choices are going to be made about whether some current services are maintained or are reduced in order to develop others due to a lack of government finance.

He added: "Our executive committee have accepted that the current working strategy is for a tax rise of up to £8."

This figure works out at an increase in council tax of up to ten per cent.

Officers at Dorset County Council will not receive the county's RSG settlement from the government until the end of November. Paul Kent, the head of financial services for the county council, said: "We have not had our Revenue Support Grant from central government yet.

"And the council will not be meeting to discuss our budget until December 18 so it is too premature to give out any figures relating to how much Council Tax bills will increase next year."

But Anne Thomas, the borough council's policy and resources committee vice-chairman, added: "If the Government recognises that district councils deliver the services that make all the difference to the quality of life of local people, we need adequate resources and we know that these services have all suffered from cuts over the last 20 years.

"We desperately need the extra cash now."