GOVERNMENT inspectors have criticised a council department which has faced losses of almost £125,000 a year.

Sedgefield Borough Council's horticultural services were rated only "fair" by an Audit Commission report - and the council's own review of the service, to be discussed by the council today, says it is unlikely to improve.

The service is responsible for maintaining 23 acres of grassed areas, trees, shrubs and bedding in the borough.

However, in-house contracts provided by the council have been costing more to deliver than the value of the contract. As a result, the total loss to the council in 2000-2001 was £123,965.

Inspectors have a scoring chart showing how good the service is, ranging from no stars for poor, to three stars for excellent. The council was rated one star for fair.

The report says there are some good features - the borough is reasonably well maintained with pleasant open spaces, customers are generally satisfied and efforts are being made to improve the cost effectiveness of the service.

However, it adds that areas of weaknesses include no clear aims for the service, and dissatisfaction in areas such as sweeping of grass clippings and shrub beds maintenance.

The report also says the service is unlikely to improve. Reasons given include that the council's best value review of the service was poor and driven by financial issues, rather than customer focus.

It also says consultation with the public was weak and an improvement plan does not address the service provided, concentrating on financial issues instead.

However, inspectors did say they were pleased to find the council is committed to improving services, and praised the "commitment, drive and enthusiasm" at senior and member level.

A spokesman for Sedgefield Borough Council said an improvement plan has been put in place in an effort to upgrade its star rating.

He said: "The council has won the tender and we have now got Investors in People accreditation, so we are moving towards the next step.

"Obviously we did make mistakes and we are attempting to rectify them to make sure there will be an improvement.