The loss of up to 500 jobs at an RAF base in Stafford will have a "devastating" effect on the local economy, council leaders have warned.
Defence Secretary John Reid announced yesterday that storage and distribution operations at RAF Stafford are to end by 2007.
The closure, which is likely to mean 280 jobs are axed immediately, is a result of a long running review of the defence supply chain.
David Kidney (Lab Stafford) said he was hopeful other uses would be found for the base.
But Stafford Borough Council said it was concerned for the future of the base, and feared 500 positions would eventually be lost.
Dr Reid said the Ministry of Defence planned to close storage depots at Stafford, Longtown in Northamptonshire, and Llangennech in Wales.
He said: "We expect to make savings of more than £50 million per year by 2010. The new organisation will require about 2,000 fewer civilian posts and about 50 fewer Armed Forces personnel."
Mr Kidney said: "This decision does not affect the current plans to find new military uses for RAF Stafford.
"Indeed, in a letter to me today the Minister Adam Ingram says there are three other uses for RAF Stafford currently being examined.
"My first thoughts, however, are with the civilians who work at Stafford now in the Storage & Distribution operations.
"They work effectively and loyally for our Armed Forces and they are facing an uncertain future. I am told that some jobs will transfer to Donnington.
"If we establish other productive uses of the RAF Stafford site, there may be new civilian jobs created as a result."
Last night Mr Kidney's suggestion of creating a taskforce to work with the MoD and ensure as many jobs as possible were saved was already being put into effect.
Nigel Pursey, the chief executive of Staffordshire County Council, has already contacted Advantage West Midlands and Stafford Borough Council to begin setting up a group.
Mr Kidney said: "We need a top-level task group to examine whether one of the Defence options is best for jobs at RAF Stafford. We have to look at alternatives, such as some release of Defence land for new job creation."
The leader of Stafford Borough Council said she had reacted with "sadness and frustration".
Coun Judith Dalgarno said: "I am once again deeply disappointed by this news and how the people of Stafford have been treated."
Coun Dalgarno said she would ask Ministers what this would mean for the future of the site, as this decision appeared to be "another step in its continuing decline".
She said: "I have repeatedly said that closure of the site would have a devastating effect on Stafford - not only the people affected by job losses, but on the local economy.
"Not only are we set to cause upheaval for 300 people and their families, but it could cost the area £17 million."