CUTS to a significant Government fund for Worcester have been derided by council chiefs - who say they are being unfairly penalised.

The city council's Labour administration says it is losing out on valuable money because Worcester's boundaries are so tight.

It follows a move to slash New Homes Bonus funding - the money handed to local authorities in return for property developments getting the nod - by £200,000.

The council's cabinet has met to endorse the draft 2017/18 budget, where the reduction came in for criticism.

Councillor Adrian Gregson, the leader, said: "We have a particular problem in Worcester because of our tight city boundaries.

"Because of our boundaries we're unable to build a sufficiently higher rate of homes to get more New Homes Bonus money."

Other politicians sounded warnings about a move by ministers to clearly link future New Homes Bonus payments to greater property building, with the threat of 'withholding' cash for poor performing councils.

Councillor Geoff Williams, cabinet member for economic prosperity and growth, said: "To my mind, that clearly means there will be significant pressure on this authority, and pressure on the planning committee, to approve more applications in the city."

But he also warned that the South Worcestershire Development Plan (SWDP), a blueprint earmarking land across Worcester, Malvern and Wychavon for 28,370 properties by 2030, is dependent on the economy.

Around a third of those properties are in Worcester, including two large extensions south and west of the city, near St Peter's and St John's.

"It's likely that over the lifetime of that plan, 'windfall' sites will come forward, that's the nature of planning," he said.

"But I'm also sure some of the sites allocated for housing will not come forward (and be built on by developers), for one reason or another.

"The figure for the city is not a 'maximum', figure, if anything it's an 'up to'."

The New Homes Bonus is worth £2.1 million to the city council this year, but will fall by an extra £200,000 in 2019.

It means an expected £1 million fund into the City Plan - the five-year blueprint aimed at improving Worcester's economy - could shrink to £800,000 by then.

Ministers have slashed the amounts for councils across the country, saying they intend to earmark more of it towards easing the adult social care crisis.