A STUDENTS' union hit by financial crisis could have a deficit of up to £100,000.

Despite the mounting problems faced by Durham University Students' Union, officials insist there is no need to panic.

Last week it was revealed that the dire financial situation faced by the union was such that the future of long-established services - like the university newspaper Palatinate - was under threat.

Since then, several businesses in the city have offered to fund Palatinate through advertising, ensuring there will be at least one more issue published.

The union is currently conducting a major spending review to try and find ways to ease the situation.

Tom Page, union president, said students need not be concerned by the problems facing the union, which has an annual turnover of around £1.8m.

"It's hard to put an exact figure on how much we have overspent on our budget by, but to say £100,000 wouldn't be far short. Last year alone it was around £61,000. We are not happy that we are in this financial position, which is why we are seeking to review it.

"We haven't had to do anything draconian, and we are doing things as thoroughly as possible.

"No-one is panicking yet, we are not in a situation where we need to do that."

Chris Lamb, editor of Palatinate, said he was pleased with the response to the plight of the paper, and there was now 'a glimmer of hope' for its future. "The fact that we are generating a lot of financial interest is a good sign.