Council facing £1.8m budget hole

A district council in Northamptonshire which faces a potential budget deficit of £1.8m next year is to hold a crisis meeting this month.

Daventry councillors said they would "leave no stone unturned" in their search for an answer to the problem.

A revenue budget report showed the council could be facing a £1,819,000 deficit in 2009/10.

Lower interest rates, a downturn in the housing market and the impact of frozen investments in Iceland are blamed.

Strategy group members will set aside a day in December to look at ways of tackling the situation.

Icelandic investments

Council leader Chris Millar said: "As we are a debt-free authority which has built up substantial reserves, with a low council tax rate, we are in a better position than many others to weather this climate.

"We are faced with extremely serious issues and we are going to study all the options open to us and leave no stone unturned to plan a sustainable budget.

"The report is a snapshot of how the council's finances stand today in fast-moving conditions - it is certainly not set in stone and may change again within months.

"The economic climate, interest rates and situation surrounding our Icelandic investments may improve down the line.

"But we must always take a cautious approach and assume the worst-case scenarios to ensure we are prepared for any challenges that lie ahead."