A UNION LEADER today warned York council chiefs not to look for "shocking" savings by cutting staff payments at the Guildhall.

Unison's Peter Household spoke out as council finance officers confirmed that the authority faces a £10 million budget shortfall.

A report to the City of York Council's ruling executive reveals a ten-step plan aimed at making savings and increasing income to bridge that gap.

This includes the possible sale of council assets and a review of pay, in which the report states "use of pay add-ons and allowances will be re-evaluated".

But Mr Household warned officers to keep their hands off wages.

He told the Evening Press that after talks with officials he had "reason to suspect" they intend to withdraw premium payments such as double time from weekend workers.

Mr Household said: "If I'm reading it right then this is a shocking way to treat loyal, hardworking and poorly-paid civil servants."

The council report says the authority was initially facing a £17 million budget gap as part of its £177m budget needs for 2005/6. This became £10 million after savings were identified.

These measures include a proposed five per cent council tax hike - in line with expected capping limits - funding one-off items from reserves, reinstatement of a £1.2 million government grant and a contingency funds cut.

Finance bosses are now drawing up further efficiency savings, including the pay review, and are looking at potential cuts to discretionary services, such as leisure and transport.

In a massive belt-tightening exercise, all departments have been asked to look at the possibility of making five per cent budget cuts, while capital assets - like Strensall Youth Club, Leeman Road Bowling Green, Balfour Street play area and Osbaldwick Lane sports area - could be sold to boost capital funds, the report states.

Capital improvement projects at Huntington School (£448,000), Hebden Rise (£531,000), road repair schemes and £25,000 in playground improvements could also be in jeopardy.

As reported in later editions of yesterday's Evening Press, council leader Steve Galloway said if the Fair Grant campaign failed, it could only mean "substantial" service cuts.

A council spokeswoman said: "We are looking at a whole host of potential savings as part of the 2005/06 budget round. This includes investigating how we deal with all pay add-ons, such as the use of overtime."

Updated: 08:21 Wednesday, October 06, 2004