Devon County Council’s predicted budget overspend has dropped by more than £4 million in two months.

The council, which has been cutting costs, now expects its overspend at the end of the financial year to be £291,000 – a steep drop from the £4.5 million it was predicting just a matter of weeks ago.

It is because some parts of the council have tightening their purse strings, although adult social care and children’s services respectively are expected to spend £2.9 million and £8.4 million more than budgeted.

Savings elsewhere include the climate change, environment and transport division (£2 million) and corporate services (£1.4 million), to help balance the books.

However, the reduced figure does not include the council’s ballooning special educational needs and disabilities (SEND) deficit, now forecast to hit £42 million for the 2023/24 financial year alone, an increase of £2.5 million in recent months.

The government allows this to be kept outside the main budget until at least 2026.

Devon’s cumulative SEND deficit is expected to be around £160 million by April.

Finance director Angie Sinclair said the main budget had “improved significantly” between November and January.

Any overspend will have to be met from reserves, of which it has £121 million, with £105 million earmarked for specific purposes and £16 million for emergencies.

“Financial risks within adult social care and children and young people are still being experienced but the work underway across the authority to support these pressures continues to ensure the whole organisation is focused on achieving a break-even position for the end of the year,” Ms Sinclair said.

“The position has improved significantly since month 8 (November), with the forecast overspend reducing from £4.5 million to nearly breakeven, and demonstrates strong financial management.”

This budget forecast will be presented to Devon’s cabinet this week (Wednesday 13 March), and comes as the authority is awaiting news on its application to the government’s Safety Valve scheme, which provides grants to councils with ballooning special educational needs and disabilities (SEND) deficits.

Devon is hoping for a significant sum to help it reduce its SEND deficit – expected to be in the tens of millions of pounds – and if successful, it is likely to have to find ways of spending money more efficiently in its education budget.