DORSET could be forced to pay back £10m to central government amid sweeping changes to how local authorities are financed.

It comes as county leaders speak out about a ‘disappointing’ level of government funding – as mounting pressures on frontline policing and children’s services may lead to a rise in council tax.

Dorset Police and Crime Commissioner Martyn Underhill has ‘with a heavy heart’ launched a consultation to ask residents if the policing precept should be raised, as South Dorset MP Richard Drax said he would be ‘failing’ in his duty if he does not speak up for the ‘underfunded’ force.

Dorset County Council said the settlement meant they would have to ‘carefully consider’ raising council tax in the new year – although cabinet member for community and resources Cllr Tony Ferrari welcomed government plans for a consultation on negative revenue support grant (RSG). 

Currently DCC could lose £10m of funding in the financial year 2018/19. 

Cllr Ferrari said Dorset is one of the councils most significantly affected in the country.

RSG – a grant from central government to fund local authorities - was slashed in 2016/17 as plans to change the way councils are financed got underway. Instead of a grant, councils will keep all of the business rates generated in the county to fund local services. 

But the speed that the new system has been implemented sparked concerns that local authorities across the country could have so-called ‘negative’ RSG, where they would have to pay money back to government.

Cllr Ferrari said: “There is no more money from central Government, although we have been offered the option to raise council tax by up to another one per cent.

“However, that option would have to be considered carefully – there needs to be a balance between the cost to our residents and the impact on the county council’s budget, particularly to deal with the growing demand pressures around children’s services, such as the increase in looked-after children and pressures within the schools budget.”

Regarding police funding, Mr Underhill said Dorset has saved £37.3m since 2010/11 – but further ‘substantial’ savings are still ahead.

He added: “We have already had to make a number of incredibly tough decisions and this settlement does us all a disservice.”

The Government has given PCCs additional flexibility to be able to raise their local policing precept by £12 a year. 

This would generate around £3.4m of additional funding in Dorset.

Mr Underhill said: “It cannot be right that the Government keeps asking my constituents, the taxpayers of Dorset, to pay more for policing every year. 

“My dilemma is that if I do not consider a precept rise, Dorset Police will struggle to keep up with demand and to deliver an acceptable service.

“Like other PCCs, I therefore have no choice but to ask whether residents are prepared to plug the hole left by the core funding settlement in order to protect frontline policing. 

“While I welcome the ability to provide more funding for an overstretched police service, I am taking this matter to public consultation with a heavy heart.”

Mr Drax praised the police for doing ‘a wonderful job’, but added: “I would be failing in my duty if I did not speak up for the funding of Dorset Police, which have been underfunded for years.

“Every increase is welcome, but historically, we remain very poorly funded in Dorset. 

“We have several large towns, which soak up most of the policing, interspersed with large, relatively unpopulated areas. 

“This makes policing more, not less, difficult and expensive. 

“I shall continue to press for a fairer allocation.”

Here's how you can have your say on the policing precept.