The Council achieved the underspend while delivering £19 million in savings in the year following unprecedented cuts in Government grant funding to the Council.

These savings were achieved in spite of a number of significant pressures in service areas including funding for continuing health care for older people, children in care placements, winter service support due to the harsh winter and early spring, and lower than expected income for a range of charged services such as planning and property rental.

Strong budgetary control led to savings on employee costs, reduced transport costs and benefits from active treasury management throughout the year.

The meant that the Council was also able to set aside £2.5 million in reserves, as part of its strategy for 2013/14, providing a one-off cushion against any pressures which may arise in the current financial year.

Cllr Bill McClements, cabinet member for finance and enterprise, said: “Against the background of one of the biggest savings figures we have ever had to make, it is testament to the hard work of councillors and employees that, despite these pressures, the Council ended the year with a very slight underspend.

“While there were some areas where many historic overspends, such as continuing health care for older people and children in care, continued in many others we were underspent.

“However with further savings of around £10 million to be found this year and the prospect of only further deeper cuts in Government funding after that together with significant increases in demand for many services, we cannot continue to absorb these through underspends in other areas, as savings become more and more difficult for us to find.”

The report will be considered by Telford & Wrekin Council’s cabinet when it meets on June 27.