WORCESTER'S cash-strapped city council would now have almost half a million pounds more to spend each year if it had increased council tax in line with other parts of the country.

Opposition Labour councillors say the Tory-led council is partly to blame for its present dire financial straits after keeping council tax increases below inflation for the past four years.

The council leadership has defended its lower taxes and says reduced Government funding is to blame for the gaping £1.6m hole in its budget.

But the Labour group points to figures which show that had council tax in Worcester been hiked by five per cent each year for the past four years - as in many other parts of England - the council would by now have an extra £471,500 to spend annually.

Labour group leader Councillor Adrian Gregson said: "One of the key reasons for Worcester's low funding position is that the city's Conservative cabinet has missed out on a total of about £1m over the last four years, simply by not recognising the problem and seeking modest increases in council tax.

"Now, apparently all of a sudden, there is a black hole. Over-prudency appears to have taken the place of strategic planning."

The average annual council tax increase for Band D properties around the country over the past four years has been 4.6 per cent, with the Government having set a limit of around five per cent each year.

Worcester City Council has increased council tax by just 2.5 per cent each year over that period. A five per cent tax hike for each of those years would have meant a Band D household in Worcester now paying an extra £14.60 per year.

Conservative councillor Roger Knight, the cabinet member in charge of finance, defended the council's record, saying there was no way the city could have avoided having to make its current cut-backs.

"Even if we had hiked council tax as high as we could and saved every penny of the extra money, we'd still be facing a budget gap of more than £1.1m ," he said.

"But what you have to remember is there's no way that could have happened - it would be ridiculous to say anyone would raise taxes and then just put the money in the bank.

"The Labour group would certainly have insisted we spend the money on better services. We'd still be having to make the same savings now."