The England & Wales Cricket Board’s planning for the next financial year has been hit by the fear of an $8million (£5.4 million) bill if the Champions Trophy is cancelled.

The tournament was postponed earlier this year due to doubts over safety and security in Pakistan. The situation in Pakistan has not improved and sources at the ECB have confirmed the board are bracing themselves for a hefty bill if it does not go ahead.

The International Cricket Council could be liable for a $70-80million compensation claim from their television broadcast partner ESS if the Champions Trophy, scheduled for September, is cancelled.

That money may well have to be recouped from individual member boards. The ECB’s audit committee has warned the board to be prudent in its spending in 2009 due to the threat of a bill landing on the desk of chief executive David Collier.

Giles Clarke, the chairman of the ECB, wrote to the counties last week warning that next year will be a break even year with question marks over how much revenue will be earned from the World Twenty20 tournament.

The ECB are also anticipating a reduction in their public funding of up to 25 per cent when Sport England publishes its Whole Sport Plan, its settlement for more than 40 governing bodies next week.

In the last spending round the ECB got more than £50m over four years for its grass roots programs, but insiders are expecting a cut as a result of the success of the Chance to Shine initiative, which is on course to deliver £10m for cricket in schools over four years.

Sources fear that a dispute over how that money should be classified will see funding cut back, particularly as Sport England has less money to distribute as a result of a raid on Lottery funds to underwrite spending for the London 2012 Olympics.