Householders were threatened with crisis council tax hikes and the prospect of cuts in policing and fire cover as the devastating impact of the Icelandic banking collapse was revealed.
At least £1billion of public money has been lost in a disaster that has swept up more than a third of town halls and police authorities.
Ministers promised help for the worst-hit local authorities where severe cash shortfalls mean a risk of punishing council tax increases or deep cuts to services such as home help for the elderly.
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Perhaps if councils cut the pay of senior executives they could afford not to cut services
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