MALVERN Town Council could be teetering on the brink of financial collapse, it has been revealed.

Coun Paul Tuthill (Link) told a meeting of the full council that, by his calculations, it was spending around £100,000 a month, and would be "bust by Christmas".

His comment came during a row over grants, during which a motion to stop any more being given until the next financial year was narrowly defeated by 11 votes to eight.

"We will be bust by Christmas, and this is the sort of thing we should be discussing, rather than fooling about with these grants," said Coun Tuthill.

Rosemary Lansdowne, acting town clerk, and Coun Mike Angell (Chase), both repudiated his claims.

They maintained that the council would be able to stay afloat until the next precept is due in the New Year. But they had to admit their estimates depended upon the arrival of an £82,000 VAT payment.

"I think you are being very optimistic in saying that the VAT payment will arrive on time," said Coun Tuthill.

Coun Ralph Madden (Trinity), chairman of the budget working party, agreed with Coun Tuthill's assessment.

"It's going to be a very close-run thing," he said, "And we still have to finance things like the Christmas lights, which will cost around £15,000, and St Michael's play area, which is around £20,000."