THE leader of Worcester City Council is braced for a "disappointing outcome" when he discovers the size of the city's annual Government cash hand-out.

Councillor Stephen Inman doubts Worcester will be given more than last year's £200,000 in an announcement expected on Wednesday.

Last year, councillors were outraged by one of the smallest increases in the county and one of the lowest grants to shire districts in the country.

"The announcement will have a major bearing on everybody who lives, works in or visits the city," said Coun Inman.

"A three per cent rise merely makes allowance for inflation and every one per cent in either direction makes a £70,000 difference.

"We have been told some authorities can expect a 0 per cent increase. If that happens to Worcester, we will be in trouble. Anything less than three per cent will create further problems."

Worcestershire county councillor Adrian Hardman, cabinet member for resources, said he expected council tax would increase by six-and-a-half per cent if it receives a 5.8 per cent rise in Government grants.

But he warned that if it received a grant only a 4.5 per cent larger, the council would be forced to make £3.3m savings or raise council tax by eight per cent.

"I'm not optimistic - the vibes from the Government are they won't tolerate large increases in council tax but it doesn't look like they are going to put the money in that makes the system work," said Coun Hardman.

"We can survive most things as long as they put the education funding right. In doing that they have got to not steal it off social service hand-outs."

He added he expected the council would face some "hard decisions" after the grants announcement, with funding for e-government schemes, roads and libraries most likely to be cut.