SOMERSET County Council is set to slash a further £20 million from its budget in the next financial year - on top of £43m of savings already agreed.

The latest cuts, revealed by council leader Cllr Ken Maddock in a new year message to the people of Somerset, follow the announcement of Government settlement grants to local authorities shortly before Christmas.

At the time, the council would not comment in detail on the level of settlement, describing the figures as complex.

It said the Government had taken away approximately £16m, but other grants, totalling many millions of pounds, meant the full impact was unclear.

However, this week Cllr Maddock called the settlement "harsh" and said it had made an already dire financial situation worse.

"It took a few weeks to unravel the settlement's full extent but now it has become startlingly clear," he said.

"Somerset County Council needs to make a further £20m in savings in the next financial year alone.

"But we saw this blow coming and took early preventative measures. If we had not acted so soon, we would undoubtedly be facing even bigger cuts going forward into the new year."

Cllr Maddock said the council had made efficiencies and looked at new ways of working.

"We also took stock. We know what we stand for, we know what we do and we know what we can't do.

"Should we keep a library open or spend the money looking after vulnerable children? Should we help the elderly or keep a recycling centre open?"

When the settlement was announced, Taunton MP Jeremy Browne, who is the Coalition Government's Minister of State in the Foreign and Commonwealth Office, said the authority had only lost two per cent of its spending power in the forthcoming financial year and warned it against making "reckless cuts".

He said the reduction would involve belt tightening but should not be an excuse for the wholesale closure of key services.

In his new year message, Cllr Maddock said there was no doubt that 2010 had been a tough year for everyone.

"For me as leader, it has definitely been one of the most difficult and challenging of my political career.

"However, the new year is a time to look forward and despite our financial deficit I have real optimism for Somerset County Council in 2011."

Cllr Maddock said he foresaw an organisation that was smaller, leaner but also dynamic, robust, ambitious and with the drive and purpose to succeed.

He said Council Tax would be frozen for another year and the authority was relentlessly striving to bring down Somerset's debt.

"Admittedly, some services people have come to expect from us we can no longer afford to do but Somerset will still continue to be a wonderful place to work, live and visit."

Cllr Maddock said new businesses were starting up in the county all the time and the council was working hard on the proposed new power station at Hinkley Point to provide thousands of jobs for local people.

Major new roads and a new bridge would ease traffic congestion in Taunton, while three new schools were under construction in Bridgwater.

"So although 2011 is going to be a tough year, I know that by working together and sharing the burden, we can reap the rewards together."