London city council rejected a deal yesterday with paramedics, paving the way for a work-to-rule campaign. Paramedics can't strike but can refuse to perform other services, such as non-essential patient transfers between hospitals and other heath-care facilities.

Cutbacks in service were seemingly avoided just before Christmas when paramedics and their employer, Thames Emergency Medical Services Inc., agreed to a contract.

But that contract was subject to approvals by London and Middlesex County, and last night city council nixed the deal.

"We are facing a difficult budget year and we are not in a position to accomodate these wage demands," London Mayor Anne Marie DeCicco said in a media release late last-night.

Council has spent its way into a hole that will require tax hikes and service cuts to get out of, budget chief Tom Gosnell has said.

The deal with paramedics would raise their wages nearly 27 per cent over four years, the city said in a release.