West Sussex County Council’s £8m underspend

But there was also a warning the authority would still need to achieve further multi-million-pound savings over the next 12 months.

The cabinet was told total revenue spending in 2010-11 was £516.6m, an underspending of £9.4m.

Cllr Michael Brown, cabinet member for finance and resources said £8.8m of this underspending was taken into reserves to fund the redundancy programme involving a 30 per cent cut in bureaucracy – which he described as ‘vital.’

He said chief executive Kieran Stigant had already pruned senior management by 30 per cent, and the office services function would be cut by the same percentage in the next month or two.

But Cllr Brown added he still wanted to remind members the county council needed to underspend by £37m this year, in relation to the past year’s budget.

He pointed out the council did not borrow ‘a brass farthing’ for its capital programme during the past year, which meant it did not pay out any interest charges, saving £1.4m.

Council leader Louise Goldsmith said this was not an easy time, and services had done extremely well.

“We are in a strong position, but we have enormous challenges in the next year,” she warned. “We should not underestimate the scale of the challenge.”

Deputy leader Lionel Barnard said the fact they had underspent on every single area proved they were all working together on the same ship.

A detailed financial report presented at the cabinet meeting said the county council was in the early stages of a radical transformation programme at a time of significantly-reduced funding.