Government spending cuts have left Kingston Council facing a potential end of year overspend of £2.7m, according to a report passed by the executive committee this week.

The council said reductions in grants to local government announced on May 24 had left Kingston £2.3m worse off, and in July the authority reported a £6.8m budget gap.

Reasons for the reduction in the gap included the cancellation of the Building Schools for the Future Programme, which saved the council £1.1m, and the use of £900,000 from the strategic investment reserve.

Describing the current £2.7m gap as “significant and of concern”, the report said: “Many of the measures that in other years we would be able to bring to bear on the situation have already been employed to reduce the gap to this level.”

Councillor Rolson Davies, executive member of finance, said: “It’s going in the right direction, but we should be mindful there should be no over spend but there’s still a way to go for that.”