Schools and libraries face huge cuts after soaring costs create £1.7bn shortfall

Libraries are among the services that could be cut as English councils struggle to balance their books. Photograph: David Leahy/Getty Images

School-building projects, swimming pools and libraries have been earmarked for emergency funding cuts because town halls have been hit by an unexpected £1.7bn hole in their budgets, the Guardian can reveal.

Rampant inflation and soaring energy bills mean that council leaders have been forced to rip up financial plans from a few months ago, with higher than anticipated staff pay bills also contributing to their newfound deficits. Without help from Whitehall, it will leave them no option but to cut services and put up council tax next April.