West Sussex County Council has been hit by the world banking crisis, but says its day to day business will not be affected.
The authority has £12.9m invested with Heritable, the British banking-licensed subsidary of Iceland-based Landsbanki.
Landsbanki has been placed in receivership, and Heritable has been put into administration, with all its accounts frozen.
A co
unty council spokesman said this sum represented about five per cent of the authority's balances in the banking system, all being with UK licensed banks.
Unlike many local authorities, the county council had no investments directly with Landsbanki, so all its money was held within UK licensed banks.
With a revenue budget of more than one billion pounds, this sum of money did not impact on the county council's day to day business.
Unison, the UK's biggest public sector union, is calling on the Government to protect local authorities from losing millions of pounds of council tax payers' money held in failing Icelandic banks.
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