"We need to examine every pound we spend" – council warning as it issues update on multi-million pound black hole

The report projects the council will be over budget by £37m by the end of the financial year.

It says that reserves of £38m will be able to cover the forecast overspending – but that level of support would mean little over £1m to cover unexpected costs, leaving the council in a perilous position.

In a statement the authority said ongoing pressure in social care is a key risk factor, as well as "other unforeseen and unbudgeted costs".

It added: "Since the finance report for the first quarter of the financial year was published in July, ongoing work to resize the council has taken place, expected to result in a reduction of 540 full-time equivalent posts overall.

"The council is reducing its spending with third parties, including agencies for essential temporary staff, and has recently introduced a new charge for garden waste collection.

"Its medium-term financial strategy lists £62.5m of plans to bring its budget into balance, whilst additional pressure from savings not fully realised in previous years makes the position more challenging.

"Many of these plans will now be accelerated to deliver savings urgently needed before the end of March 2025."

Councillor Gwilym Butler, Shropshire Council’s Cabinet member for finance, corporate resources and communities said they wanted people to know and understand the severity of the situation.

He said: "This report has been published as part of our commitment to be completely transparent about the acutely difficult budget we have to deliver this year.

"When the Medium-Term Financial Strategy was agreed by the council in February, we warned of the difficult decisions we would need to take this year, like lots of other councils.

"More than 55,000 residents have now subscribed to garden waste collections, and many more will now start to feel the impact of further tough choices.

"As we move into the autumn and winter period, residents will start to notice where we have had no choice but to reduce the level of service we offer. Whether highway repairs, street light replacements, or many other services, we know the impact will now be felt by our communities.

"We need to examine every pound we spend at this critical point to secure sustainability for the future."