Leicestershire County Council has called on the Government to set out a “clear roadmap” on the long-term future of local authority funding.

A new economy Report published by the agency said managing the demand for social care for adults with reducing inflation meant it was “on track” to balance the books this year.

But it says “uncertainty about government spending plans” poses the “biggest financial challenge” and if support is not forthcoming the council’s budget gap could exceed “£100m by 2028”.

The Ministry for Housing, Communities and Local Government said it would “bring more stability” to councils.

The authority’s report said providing support packages for adults in a different way would reduce spending by £13m, but warned that rising demand for children’s social care will increase costs by £9m.

The council also highlighted “increasing construction costs” as an issue for major capital projects, including the northern and eastern sections of the Melton Mowbray distributor road.

Construction of the 7 km long road started last year is said to be “progressing well” but extreme weather, unstable ground conditions at key sites, utility delays and a host of archaeological finds are increasing costs, the authority said.

Lee Breckon, the council’s board member for resources, called for “clarity on local authority spending” to help the authority “go further to protect core services”.

“Taking a firm, long-term grip on our economy is why we haven’t reached the tipping point,” he said.

“Despite being poorly funded, we are efficient and we are lean and remain one of the best performing county councils in the country.

“We have drawn up plans to increase buses, fill more potholes and support vulnerable children and families, but the uncertainty surrounding council funding means councils are in limbo.

“That’s why we want the government to align with us on funding plans, put forward a clear roadmap and prioritize reforms to support for children with special needs and disabilities.”

A spokesperson for the Ministry for Housing, Communities and Local Government said: “This Government will fix the foundations of local government and work closely with the sector to do so.

“We will bring more stability to councils through multi-year funding deals, end the tendering of pots of money and reform the local audit system.”