City of York Council has said that its forecasted £3.4 million annual overspend is an "incredibly positive" sign.

In a report submitted to Thursday's (September 12) Executive meeting, the director of finance - Debbie Mitchell - laid out the council's projected financial position for 2024-2025.

It said that the council was in a "challenging position" with a £3.4 million projected overspend for the year.

However, the report added: "This is a huge improvement on the £11.4 million forecast overspend we have previously seen at this stage in the financial year and is a direct result of the significant work undertaken by officers across all parts of the council to identify savings and mitigations.

"There is still a forecast overspend and therefore, whilst it is incredibly positive that the position is much improved, there remains a great deal of work still to do."

The council said that if it continues to spend at the current level without change, then it will "exhaust" its financial reserves.

"The current level of expenditure is unaffordable and therefore we must continue the work started in the previous financial year to identify and take the necessary actions to reduce expenditure," the report added.

Ahead of the Executive meeting, the report recommends areas in which £900,000 of savings could be made.

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These include a £200,000 reduction in street lighting costs, a £300,000 reduction in waste collection costs, a £200,000 reduction in waste disposal costs and a £200,000 reduction in transport costs.

Forecasted overspends in a variety of areas were cited, including in disabled children’s services and legal fees.

The disabled children's services overspend was a product of staff resourcing issues and turnover in the council's SEND statutory services team, the report said.

The report added: "The need to resource work to progress the safety valve targets have continued and resulted in the need to appoint a number of agency staff and also increase supporting resources, resulting in a predicted overspend of £52,000 based on current staffing assumptions."

Along with these, comparatively smaller, overspends - was a forecasted £2.36 million overspend in adult social care.

The projection was based on customer numbers and costs in the first two months of the financial year, but it includes an assumed £2.18 million of savings, which are set to be made by the end of the year.

The total expenditure for adult social care at the end of the year is expected to be £45.3 million, with a five per cent overspend.