Bristol City Council has been warned it must take urgent action to avoid bankruptcy over the spiralling cost of special educational needs and disabilities.
In the last financial year it spent £94.6m on the sector, £16m more than was initially budgeted.
Added to previous overspend, it now has a total deficit of £42.5m with three years to reduce the amount.
The council is now working to lower costs despite rising demand in its special needs provision.
Although councils are not legally allowed to outspend their budgets, parliament granted special permission for councils to run deficits in their schools budget until March 2026.
Finance manager Angel Lai told a council meeting: ‘We don't have the reserves to cover the overspend as it is, let alone if the position keeps on deteriorating – it's a huge financial risk to the local authority.’
She added that forecasts provided by the Department for Education suggest that by 2025-26 the council could reach an in-year balance.
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