The City of London, one of the 12 top-rated councils for children's services, is having to cut back after a projected overspend of £1.4m by adult social services in the 2007/08 financial year.
The director of community and children's services, Jenny Goodall, has told managers to terminate all agency contracts, including consultants, in order to claw back some cash.
In a memo obtained by CYP Now, she also announced a complete recruitment freeze until the start of the 2008/09 financial year and no further expenditure on services and supplies such as stationery, professional fees and communications.
But trade union Unison has claimed the council has untapped reserves, which it is refusing to spend on local services and accused it of pretending to be strapped for cash.
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