WORCESTERSHIRE County Council caused no surprises when it set a council tax increase of 4.94 per cent for the coming financial year.

As had been widely predicted a meeting of the full council agreed the increase last week.

It equates to a £42 rise on a Band D property, up to £899 from £857 when bills are due on April 1.

The council was looking at an £8.7m gap in its finances for 2006/07 following a grant of £69.7m for its day-to-day services such as providing social care, highways maintenance, libraries and waste management. A total of £5.2m of the black hole has been plugged by using reserves put aside for such an occasion.

The rest has been bridged by identifying a further £3.5 million efficiency savings.

A total of £1.4m will come from highways maintenance, while adult social care will also provide a substantial chunk. These savings are not cuts, officers claim, and say different ways of working will not jeopardise services.

Cllr George Lord, (Con-Avechurch) from Marlbrook, the leader of the council, said: "Our settlement from government of a two per cent increase was not good, especially when you consider that things like gas and electricity are going up by so much

"It will cost an additional £700,000 next year to light the same lamp-posts, and there are other issues for us, like the increase in road maintenance costs of seven per cent.

"We have bridged the gap with more and more efficiency savings, but I cannot make any guarantees that we won't need to make cuts in 2007/08.

"Nor can we guarantee that we will be able to meet all the promises we made in the Corporate Plan that laid out our priorities for the next four years," added Cllr Lord.

"With this increase, we are setting one of the lowest council taxes in the country. However, I feel for our pensioners, who are faced with the same gas and electricity pressures as us, but have static pension increases."

The county council's precept makes up around 75 per cent of the total council tax bill. District, parish and town councils, police and fire also have to add to the final bill.