A "hugely disappointing" government funding settlement to Kent has prompted fresh fears of service cuts and job losses.

Communities secretary Michael Gove has announced a 6.5% increase in budgets to help town halls cover the increased cost and demand for social care.

But many local authorities claim the £64bn in extra cash will not cover their bills and many face the spectre of issuing a section 114 notice, an effective admission of bankruptcy.

Kent County Council (KCC) leader Cllr Roger Gough said the government had shown a "blatant disregard" for local authorities' needs.

Cllr Gough added: “We are hugely disappointed that the local government financial settlement announced today does not go anywhere near addressing the severe and mounting financial pressures being exerted on well-run county and unitary authorities such as KCC."

Despite repeated pleas to central government, he claimed KCC is now in "an unsustainable financial position".

Cllr Gough added: "In providing no additional funding to local government, the government has shown a blatant disregard for local authorities, who passionately care about the residents they represent, and want to shape strong and prosperous communities. And yet here we are just doing our level best to survive.

“To balance our budget this year we now have no choice but to severely cut many services that residents value, slash investment in projects designed to improve life in Kent, and impose a council tax rise that will further impact our residents in what are already such gruelling financial times.

"However, the stark reality is that even these measures will not ensure we can align our revenue and expenditure to deliver a balanced budget next year.

“The government has simply not listened to local government across the UK and the outlook is bleak.”

Levelling Up Secretary Michael Gove said: "Councils are the backbone of their communities and carry out tremendous work every day in delivering vital services to the people they serve.

"We recognise they are facing challenges and that is why we have announced a £64bn funding packageto ensure they can continue making a difference..."

Deputy cabinet member for finance, Cllr Harry Rayner, warned discretionary spending will be targeted to protect services KCC is legally obliged to perform.

He said: "The message coming from central government to local authorities is - please use your reserves. It's going to be a difficult budget both now and in the years that follow."

Recent KCC papers showed that at the time, the authority had £400m of usable reserves but will have had to spend £100m of that sum by March next year.

KCC staff should brace themselves for job cuts, said one Tory member.

A senior Conservative councillor said: “There has to be a loss of roles right across the board - nowhere and no one can feel protected. You can’t sustain what you can’t afford.

“If you compare Kent with the so-called basket cases like Birmingham and Woking, we’re a model local authority. Yet the residents of Kent are being made to suffer.”

KCC has said it will publish its updated draft budget on January 3 but its own report conceded it will have to be "leaner" in the future.

Local authorities have been in trouble since the 2008 financial crash and left on the brink since the pandemic, which exposed many councils' weaknesses, especially around large borrowings.

It’s just too little, too late for many councils

Chief executive of the Local Government Information Unit, Jonathan Carr-West, told the LDRS: “If you take the headline increase of £64bn and apply that to the shortfalls at hundreds of councils across the board, it won’t be enough to fill many holes.

“It’s just too little, too late for many councils. As ever, the devil will be in the detail.”

Mr Carr-West said the leaders of Conservative authorities, like Kent, are at a loss to understand why the government is unwilling to finance councils properly.

He believes council finances are not high on the government's priority list.

Mr Gove has acknowledged deep concerns raised by the Local Government Association that some councils are in danger of going bust.

He said: “It is certainly the case that local government faces significant funding pressures.”

Kent's greatest pressure is felt in social care, providing for special educational needs and other areas such as the care of unaccompanied asylum-seeking children.

A recent LGA survey found 17% of senior council executives thought it was “very or fairly likely” they would have to issue a s114 order this or next year.

Mr Carr-West is confident KCC can survive this year but with auditors estimating £86ms cuts needed next year, that is when it is at its most vulnerable.

A Tory County Hall backbencher said: “We just don’t get it, we really don’t. The government just seems happy to let councils go bust.

“A cynic might feel Rishi Sunak is happy to leave Sir Keir Starmer a world of strife to deal with when he becomes Prime Minister next year, particularly with those Labour councils which are closer to going broke than the likes of Kent.”

Forty-eight members of the Special Interest Group of Metropolitan Authorities (SIGOMA) wrote to Prime Minister Rishi Sunak to warn him the settlement must be sufficient to cover cost of statutory services.

The County Councils Network (CCN) was left "bitterly disappointed" bt todasy's announcement.