Cherwell District Council is expecting to lose £1.8m of its annual Government grant over the next two years.

The council is looking at ways to cut its costs without hitting front line services such as refuse collection and recycling, car parks, housing services, street cleansing.

The local authority started planning for cuts in the spring and at the time predicted the worst case scenario was cuts of about 30 per cent, which has since become a reality.

Over the summer, Cherwell held a series of workshops to find out what services people felt the authority should protect and what could be reduced or lost. It found people wanted to protect environmental services, planning, affordable housing and housing services, economic development, local transport services, and voluntary sector support. But those in the firing line could include street scene and landscape, health and recreation, tourism, museum, health improvement and the arts.

Feedback from the workshops also said councils should not be spending in areas were not its direct responsibility such as the police and NHS.

James Macnamara, Cherwell’s executive member for resources and communications, said: “The announcement was largely in line with what we expected but we will not have a full picture until the Department of Communities and Local Government announces our grant settlement in December.

“However, the news that the DCLG budget has been cut by 7.1 per cent each year for four years means that we have enough headline information to go on to start to considering how we will make the necessary savings. We have worked hard in the past few months to prepare for the inevitable cuts and we believe the council will be in a strong position to protect many front-line services.

“If our negotiations for shared management with South Northamptonshire council are successful, the move will go a long way towards making the necessary savings.

“We hope to find other innovative ways to make up the shortfall but we are likely to face the need to make more changes which will mean further pain for staff.”

Cherwell expects to see its Government grant of £10.9m drop by 11 per cent next year, £1.2m, and a further 6.4 per cent in 2012/13. The council expect to get full details of how the Government spending review will effect it later this month or in December. And it will start considering next year’s budget after that.

In the meantime, it is looking into sharing senior managers with South Northamptonshire District Council, a move that could save £686,000.

A week ago, councillors agreed to start charging for planning advice before an application is submitted, which it expects to generate income of about £10,000 a year.

It also hopes to save £79,000 by advertising planning applications at the minimum legal requirement, a further £15,000 by introducing electronic consultation, and £20,000 by dropping specialist advice on routine agricultural or retail applications.