Up to 850 council workers could lose their jobs in Oldham
Up to 850 staff at Oldham Council, in Greater Manchester, face losing their jobs as the authority tries to tackle a budget deficit of more than £17m.
Council leader Howard Sykes said it was "critical" that the authority found a way to save money, but added that the plans were still at an early stage.
The Liberal Democrat-controlled council said compulsory redundancies would be a "last resort".
The authority is Oldham's biggest employer with nearly 5,000 staff.
Councillors met trade union representatives on Thursday to discuss the proposed cuts, which the authority said would not affect any schools.
Staff found out details of the cuts when they arrived at work on Friday.
Mr Sykes said: "The fact is that the council has to find £17.3m of savings to balance next year's budget.
"Staffing costs, like those of a lot of other councils up and down the country, are a big part of our overall budget, so it is inevitable that we should explore the potential for savings in this area.
My reaction is shock
Phil Woolas MP
"The proposed savings are critical in our efforts to provide the borough's residents with the value-for-money services they quite rightly expect."
According to Prime Minister Gordon Brown, who was in Manchester for the Labour party conference, the council has already been given extra funding from central government.
"We have raised the grant to Oldham Council by 6% this year and it's a higher raise in grant than in some other councils," he said.
"That means we are giving, from central government, money that I think is about £6m extra allocation beyond last year.
"I would have thought with the raise in grant we have made they are in a position to make decisions to ensure a good deal for council tax payers and to ensure that services and jobs are protected."
Phil Woolas, Labour MP for Oldham East and Saddleworth, is meeting council bosses to discuss the proposals to tackle the deficit.
"My reaction is shock," he said.
"We had a very good settlement in the grants this year from the government, the best in the region, at 6%."
Mr Woolas said that he was unclear whether the jobs cuts were part of an "options paper" rather than specific cuts.
Councillor Lynne Thompson, the Liberal Democrats' finance spokeswoman, said compulsory redundancies would be kept to "a minimum".
"It is a last, last resort," she said.
"We'll be looking at voluntary options, we'll be looking at options which don't involve staff like rationalising use of buildings and if it comes to compulsory redundancies we will be supporting them."
Steve Ashforth, who has worked at Oldham Council for the past five years, believes 850 job losses would severely effect the service the council provides.
"It's a joke. I really can't see how they can cut 850 jobs, which equates to nearly a fifth of the workforce," said the 21-year-old, who works in the finance department.
"How would the council run? Every department would provide a slower and poorer service which would have a detrimental effect on the whole of Oldham."
The Liberal Democrats took control of the authority in May from Labour.
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