Wirral Council is considering launching its own development company to raise cash as it attempts to tackle a £132m budget black hole.

Householders will be hit in the pocket with council-tax increases to cover the defict - and services and fees will cost more under radical reforms.

The Government has told the local authority it must cut spending by £132m over the next four years - £45m will need to slashed in the next 12 months.

At the same time it is phasing-out all councils' Revenue Support Grants while allowing them to keep money raised locally through business rates.

Wirral missed out entirely on so-called “transitional funding” to soften the impact of losing the support grant.

A North/South divide became apparent when a £150m-a-year fund was created to help councils cope with the ending of the grant and gave £9m to Oxfordshire, £18.7m to Hampshire, and £24.1m to Surrey.

But Merseyside - Wirral, Knowsley, Liverpool, Sefton and Halton, received absolutely nothing.

The speed of the central funding shake-up also took town halls by surprise and Wirral is among many authorities whose budgets face being threadbare by 2020.

At next week’s cabinet meeting a four-year plan will be unveiled which could move many existing services to new organisations.

It will also propose increases in revenue and income targets from business rates, council tax, fees and charges.

Leader of the Labour-run authority Cllr Phil Davies said: “Since 2010 we have managed to somehow deal with massive budget reductions while largely protecting front-line services and residents from the worst of the cuts.

"We’ve used our reserves, sold assets and asked our staff and partners to do a lot more with a lot less.

“But for next year and beyond minor reductions to services, small increases in charges, will no longer get the job done.

"We need a major, fundamental redesign of how the council works and how it provides services."

He said in financial terms the removal of the Revenue Support Grant means the only money available to invest and pay for services will be from money the council can raise itself.

“Simply put, by 2020 Wirral will be going it alone and must be self-sufficient," he said.

“This act by the Government means councils like Wirral must make radical reforms to how we deliver services, how we strengthen our economy, support businesses growth and encourage new firms to move here and create jobs.”

The creation of a new company charged with attracting new investment and jobs to the borough is being considered alongside the four-year plan.

The company would take responsibility for promoting Wirral nationally and internationally, working with investors and developers and encouraging businesses to set up or relocate to the borough.

Budget proposals at-a-glance...

Improving Efficiency - £38 million

The council needs to be well organised and efficient, and make progress towards achieving better value for money.

Over the next four years, the council is proposing to save £38 million by renegotiating contracts, improving the way money is managed and invested, and getting the best possible value from every pound available.

Redesigning Services - £40 million

A programme to redesign all council services including leisure and culture, making sure they meet residents’ needs at a reduced cost to the taxpayer, is underway.

Detailed consultation with residents on the proposals will be delivered in early 2017.

Generating Income - £56 million

Accepting the Government’s offer of a ‘four year settlement’ brings the requirement to agree an annual council tax rise.

This, coupled with charging a fair price for ‘paid for services’ will bring significant new income to the council.

Plans are also being progressed to increase how many new homes are built in the borough.

With more than 13,000 approved planning applications already on the books, a big increase in house building will deliver millions in additional revenue.

The cabinet will meet next Thursday, December 8, at 6pm.