The Conservative administration is now investigating ways to plug the gap, including a review of all services.
It also said the government’s Fair Funding Review, external would see £17m cut from Herefordshire Council’s funding by 2028-29, meaning council tax increases of 5% were likely every year between now and then.
Lester added: “We remain deeply disappointed by the government’s funding approach that has left Herefordshire residents short-changed – again.
“It is clear they have failed to sufficiently fund the additional costs of delivering services to residents across a rural county like ours.
“Unlike some councils, we won’t be seeking a bailout or government loan, or calling for 10% council tax increases.
“But, we will take tough but responsible decisions to control costs, protect essential services and keep the council financially sustainable.”
A spokesperson for the ministry of housing, communities and local government said: “We’re making £78bn available for council finances next year, including up to £237m for Herefordshire to help them deliver the high-quality public services people need.”