DORSET is nearly £3 million better off after the Government said today that it would get nearly £33 million as its council funding settlement for 2007-2008.

County council leader Coun Angus Campbell said: "Despite this increase Dorset is still the lowest-funded county in the country and we will continue to fight alongside the district and borough councils for a fairer funding deal.

"Although any increase in formula grant is welcome, it must be looked at within the context of a significant funding gap between the cost of providing services and the income we receive.

"This gap, which did stand at an estimated £20 million by 2009-2010, has now been driven down to £15 million through a continuing programme of efficiency reviews."

Weymouth and Portland saw its award rise from £5.294 million in 2006-2007 to £5.746 million for 2007-2008, an increase of £452,000 or 8.5 per cent. Chief executive Tom Grainger said the figure is in line with what had been promised last year.

He added: "The devil may be in the detail and we don't know yet what specific funding is contained within that figure for new council duties such as no-smoking legislation which is due to be brought in next year. To balance our budget there will have to be some hard decisions made in coming months."

West Dorset saw its award rise from £7.627 million for 2006-2007 to £8.042m for 2007-2008, an increase of £414,000 or 5.4 per cent.

Council finance chief Adrian Stuart said: "This is in line with our expectations.

"Pressure continues to mount for improved services and some hard decisions are ahead, but we still expect West Dorset's part of the council tax will be limited to a 2.5 per cent rise for 2007-2008 in line with inflation."

Other government awards include an extra £2.162 million for Dorset Police, a rise of 3.6 per cent.