Council chiefs in Sheffield say although the city's finances have been hit hard by the impact of coronavirus, the authority can cope.
The council has lost money with business rates, car parking charges and leisure centre closures while it's also had increased Covid-related costs such as providing PPE in care homes.
It has an overspend of £23.4m, of which £18m is related to Covid. The council describes it as "a serious concern" but says it has enough savings to survive.
The gap is clearly quite a painful number but we can cover it. We do have reserves and have £35m that we could use over the next few years. We have a war chest and we have unearmarked general reserves of £12m-13m which is only to be used in emergencies and this is certainly an emergency. It is a big number but we can cover the immediate problem and we are not about to become insolvent.
Mr Phillips said some costs wouldn't hit until next financial year and to date, the council was expecting £34m of government funding with possibly another £10m on the horizon.
But he warned the government would need to give much more financial help.
We do have some time to react and respond and we are being relatively optimistic in the short term but without government support the medium term is very challenging. We are going to need further central government support or we will get into a very difficult position.