COUNCIL leaders have identified a £91m black hole in Liverpool's budget for the coming financial year.

According to the council, on top of the £57m axed by the government the local authority must find £34m to balance its books.

The huge £91m figure amounts to about a quarter of the £400m slice of the council's £1bn-plus budget over which it has direct control – or has not already committed the cash.

Deputy council leader Paul Brant said the cuts would be worse than those imposed by former Prime Minister Margaret Thatcher and that voters had not yet grasped how dramatic they will be.

He said: "Every service will be affected in some way, from libraries and leisure centres to parks and looking after the elderly.”

On Wednesday the Labour administration will sit down with the Liberal Democrat opposition and minority Green party to start setting out a joint budget. It follows a mass meeting at the Echo arena on Tuesday when the scale of the cuts will be explained to council staff.

The unprecedented joint budget move came in response to the scale of the huge task ahead.

The council hopes to have earmarked its exact cuts by early February to allow for a short period of consultation.

Councillors will vote on the budget on February 23 – and it will be introduced from April.