LOCAL Government Minister Nick Raynsford has warned York council chiefs to further reduce their planned increase in council tax.

But the leader of City of York Council says that it is too late to cut the bills further.

York MP Hugh Bayley revealed the Mr Raynsford had insisted that City of York Council must get out of the capping "danger zone" and lower the rise even further from the current proposal of 8.5 per cent.

He said Mr Raynsford had told council bosses he was encouraged they had brought down the increase from 9.3 per cent, but said they must now go one step further to be safe.

"He sent the council away with a clear message that they have to cut their council tax if they want to avoid capping," Mr Bayley said.

"He listened carefully to their arguments, but is alarmed by the level of the increase and he wants them to think further about reining in expenditure.

"Pensioners are telling me that there is no excuse for an 8.5 per cent rise in council tax when the Government's grant to York has gone up by twice the rate of inflation. They want the Government to force the council to trim its spending."

The final bill to York taxpayers - including demands by fire and police - sees an increase of 9.1 per cent and is the third highest of the 101 local authorities in England and Wales which have finalised their overall bill.

"I want York to escape capping because it costs taxpayers a lot of money," Mr Bayley said.

"It means new bills have to be reissued, which costs thousands of pounds.

"I don't complain that the Liberal Democrats are spending money on the things they promised to do, but what is indefensible is that they are spending money on new schemes without making savings in other areas of the council's work which they think are less important."

But council leader Steve Galloway said it was too late to further reduce the tax, as bills were already being printed.

He said: "We have had no further communication from Mr Raynsford.

"Hugh Bayley's comments are outrageous - he has had a personal interview with the director of resources when it was explained that we have made savings of £3.6 million."

Updated: 08:29 Thursday, March 04, 2004