The leader of Southampton City Council has spoken out over claims the council could go bankrupt by next year.

The Labour administration has been criticised after the authority's chief financial officer warned the council could run out of cash reserves by the next financial year.

Only yesterday, councillors approved money-saving plans to switch off street lights for three hours per night, increase the Itchen Bridge toll for non-residents and put council tax up by 4.99 per cent.

However, without further savings, "there is every chance" the council could burn through its reserves, a report said.

READ MORE: City council could go bankrupt by next year, chief finance officer warns

Cllr John Hannides (Con) has hit out at the "abject failure" of the Labour administration, adding that what should have been a historic day - the first time a Lord Mayor is presiding over a budget meeting - will be "remembered for all the wrong reasons".

But Cllr Satvir Kaur, the leader of the council, is pointing the finger at the Conservatives, accusing them of "taking people for fools".

In a statement, she said: “Local Conservatives left a huge £23m black-hole in the council’s finances from when they were in power last year, which drastically deepened due to their own Government’s disastrous mismanagement of our economy.

“The Tories cannot go from causing our city’s financial problems, to now just complaining about it, with no alternative offer to residents.

“They are trying to take people for fools, but it’s clear to everyone that this is nothing more than just cheap political shot to deflect from the fact that the Tories have no plan, no idea and no real leadership right now nationally and locally.

“The fact that the Conservatives couldn’t even be bothered to present an alternative budget this week while making promises they don’t know how to fund, just shows how clueless they really are; much preferring to waste £250,000 fixing a private road, than deal with the painful reality their Government has put all councils in.   

“Of course there is an increased financial risk to every council across the country right now which will only be resolved by a fairer funding deal from Government.

“Despite the scale of this challenge though, I’m pleased in Southampton, we’ve taken the majority of savings from efficiencies and making the council work more effectively, enabling us to prioritise frontline services people are relying on now more than ever.

“We are focused on bringing more investment into our city, and have plan to grow our local economy, creating more jobs and opportunities, from maximising our marine and maritime, becoming a destination place to grow our visitor economy, to being leaders in future growth areas like the green economy.”