Read the latest news from the world of local government
Authorities that have money tied up in Icelandic banks will not have to show this in their budgets until 2010-11, the government has revealed.
The decision to increase council workers' pay by 2.75 per cent will mean jobs have to be cut, according to the Local Government Association.
The economic downturn could lead to a pay "apartheid" between the public and private sectors, it has been claimed.