A Scottish council has warned of ‘harder times ahead' as it projects an overspend of at least £5m this financial year.

Highland Council's budget leader, Cllr Alister Mackinnon, said that ‘urgent action' was needed to bring expenditure back under control by March.

The council's reserves, which are at about £8m, are below the minimum level recommended by Audit Scotland, Cllr Mackinnon admitted.

He said: ‘It is vital that they are not depleted further by a year-end overspend. This is an early warning and we are determined to take the necessary corrective actions, in a business-like manner, recognising the seriousness of the situation.'

Council staff have been asked to avoid non-essential expenditure and consider deferring non-priority activity.