Government to give extra £6.6m to Leicestershire County Council but authority warns £78 million savings are still needed

But council chiefs have warned county residents that even with the extra cash the authority still faces having to make more than £70m of savings over the next four years, including proposed cuts to bus subsidies, waste sites and public health work.

Last month Sir Alan was among six county MPs and Leicestershire County Council’s leader Nick Rushton who briefed Local Government Minister Marcus Jones MP on the tough budget situation facing the council.

Sir Alan said: “This is a real boost that we would not have got without a concerted effort from Leicestershire MPs to improve the deal on the table.

“The funding formula still needs fundamental reform so that we get a fairer share than we do now, but this is a big step in the right direction and will alleviate some of the shortfalls.”

Mr Rushton added: “I welcome the Government’s decision to provide almost £7m in additional support for Leicestershire over the next two years.

“This shows that ministers have listened to the case we presented to the minister last month. It’s a real breakthrough and I’d like to thank all our MPs for their fantastic support.

“Clearly we have more to do, The council has to make more than £70m of savings over the next four years.

“But the Government has committed to have a fair funding review and I’m hopeful that we can work together to make further progress.”

A Leicestershire County Council spokesman said: “We are currently analysing the detail of the funding settlement and will present a fuller report to Cabinet tomorrow.”

The council’s ruling Cabinet will finalise its budget proposals when it meets tomorrow morning before the full council decides the budget for the next financial year (2016/17) on Wednesday.

Total savings of £78m will be required, including £26m from April. The council has only identified £59m, leaving £19m still to be found.

Efficiency savings of £27m have been identified and council tax rises of 3.99 per cent per year, over the next four years, are proposed.

An estimated 500 full-time equivalent jobs are also likely to be axed – 900 have been cut over the last five years.