Two local authorities could be merged into one to meet potential government cuts of more than £8million.

People living in the areas of Mid Suffolk and Babergh voted against the councils merging in 2011.

But Mid Suffolk District Council’s leader, Derrick Haley, said that in the face of fresh cuts the councils would need to look again at merging.

He said: “I think we will have to look at it, we will have to revisit it at some time. Maybe not in the next two to three years, but we have to think about it, let’s be honest.

“We need to change some of the services – that goes for both councils. We are having to save money but the public’s expectations are high, they think we should be doing more and we need to engage with the public about what they actually want.”

The councils have saved almost £9m in the past four years after government cuts of about 40%.

But the authorities could have to make savings of £3.4m in 2014/15 with a total cut of £8.2m over three years until 2016/17.

Mr Haley said the benefits of all services would have to be looked at.

He said: “Sooner or later services will be affected.

“At the moment local government has been very efficient at cutting costs. Look at us and see how our management structure has been slimmed down.

“If you start cutting the leisure centres it has repercussions on health in the community. We have to weigh up if we start doing that. I have to say that it would be a last resort.”

He said the councils had been at the “forefront” of being more efficient as they worked to share services and staff.

He added the biggest thing the two councils needed to work together is trust. Mr Haley said: “If we had not implemented any of these savings none of the councils would have survived. Small district councils cannot stand alone.”

The detail of the expected cuts to local government budgets will be announced as part of the Spending Review on June 26.

The councils are due to announce how they will make the cuts in the autumn.