SOMERSET County Council is facing a £20 million funding shortfall due to shrinking Government grants.

And despite announcing plans for a fourth consecutive Council Tax freeze, the authority is warning savings will have to be made to plug the funding gap.

In a statement released this week, the council said its draft budget included plans to spend an extra £4.8 million on caring for vulnerable people, additional funding for roads and plans for more books in the county's libraries.

Full details of the draft budget are not yet available for public scrutiny and are not due to be discussed until next month's meeting of both the cabinet and full council.

But in this week's statement, the council said it would push ahead with extra investment despite a tough settlement from Government which would see the authority operating with £20 million less than last year.

The authority said it would "reduce bureaucracy in the county council" and make "libraries part of the community" over the coming 12 months.

But the statement also warned that savings would also have to be found due to the cut in Government cash.

Council leader Cllr John Osman said: "It is extremely difficult and challenging when our income goes down, but the number of people needing our help is going up.

"Just one example, a few years ago over 350 children were in care in Somerset.

"Now that figure is more than 525 and rising."

He said each child could cost the authority between £3,000-£5,000 a week to look after.

The draft budget proposals are due to be discussed at February's cabinet meeting before going before the full council later in the month.

Other proposals listed in the statement include the reorganisation and modernisation of services to "bring significant efficiencies and savings", particular within care services and the provision of children's centres.

The council pledged to keep all 41 of the county's children's centres open through a restructuring process, and said it would also look to develop more efficient working practices with schools and early years providers.

"These are very tough times for all councils across the country, it is no different in Somerset,' said Cllr Osman.

"We have protected some areas for the coming year, like youth services, libraries, and school crossing patrol officers.

"We will continue with our priorities, to care for people who need it, and to deliver all our services with the best possible value for money."

The Council gets one third of its income from Council Tax, with the Government giving the other two thirds.

However, at the end of last year Westminster announced that the council's funding would be cut back again by another 5.5 per cent.

The council estimated the cutbacks, coupled with increased demand, would leave a £20 million hole in the authority's finances.