A SENIOR York voluntary sector worker has given a "cautious welcome" to £260,000 worth of council grants to volunteer groups across the city.

Colin Stroud, chief executive of York Council for Voluntary Services, warned some groups would face a financial struggle as a result of the grant package.

But he welcomed the council's decision to grant rate relief and avoid slashing the amount of money handed to groups.

City of York Council has had to penny-pinch frantically this year to prepare a balanced budget.

Last autumn, it reported a worst case £10 million budget "black hole".

Mr Stroud said: "It will inevitably mean difficulties for some groups, the cost of voluntary organisations rises by slightly more than the rate of inflation.

"But in some ways we are quite pleased.

"There are no swingeing cuts, and the council has tried hard to give us a reasonable deal.

"Voluntary organisations in York receive relatively poor funding, there are a lot that will struggle. They struggle every year.

"But given the council's funding situation we are reasonably happy with this year's settlement. Voluntary organisations in some council areas have suffered from serious cuts as a result of financial problems those councils were facing."

Council leader Steve Galloway said: "We decided the efforts of the voluntary sector needed to be recognised. We also decided for the first time to allow for inflation.

"It is modest against the background of the council's overall budget, but it is always difficult to allocate the cake and we have tried to do that fairly."

The grants include £28,145 for the council for voluntary services, £10,052 for York Travellers' Trust, £29,626 for York Racial Equality Network and £1,500 for York Rape Crisis.

The grants are set to be debated at a meeting of the council's executive leader and advisory panel on Friday, at 4.30pm.

Updated: 09:27 Saturday, February 21, 2004