CORNWALL Council put millions of pounds into its reserves last year, as local authorities across England saved £1 billion to prepare for financial shocks.

Financial experts say councils are topping up savings where they can, to prepare for "uncertain, looming costs" associated with Brexit, and the expectation of continued austerity.

Ministry of Housing, Communities and Local Government figures show that Cornwall Council put a net £3.5 million into its reserves in 2018-19.

Local authorities hold money in two types of reserves, unallocated and earmarked, neither of which are ring-fenced or controlled by central Government.

Cornwall Council put £3,744,000 into earmarked reserves last year. These are often held against budget risks, such as insurance excesses, but also include money set aside for specific upcoming projects, such as building works or outreach programmes.

However, the council withdrew £228,000 from its unallocated reserves, which are there to help cushion the impact of any unexpected events, emergencies, or unforeseen budget difficulties.

Across England, councils added more than £1 billion net to their reserves in 2018-19, an increase of 7%.

The Chartered Institute of Public Finance and Accountancy said the figures show how councils are adapting to continued political and economic uncertainty.

Joanne Pitt, from CIPFA, said: "Local government reserves play a vital role in good public financial management, and it is crucial that authorities maintain a focus on strong financial management given the uncertain future for funding and service demands.

"Increasing reserves may also reflect the absence of a long-term funding settlement for the sector, and an expectation that the long, hard winter of austerity is set to continue."

The Local Government Association said it was unsurprising that councils were "acting prudently" to prepare for financial shocks.

Councillor Richard Watts, chairman of the LGA's resources board, said: "Councils have only just found out how much money they will have to pay for local services next year.

"The latest Spending Round delivered a £3.5 billion funding package for councils in 2020-21, which will help them manage immediate cost and demand pressures, but we remain in uncertain times.

"While earmarked reserves go up and down each year, as they are used for the projects for which they are held, what is left would cover less than a month's spending by councils on local services."

An MHCLG spokesperson said: "All local authorities are required to hold enough reserves to meet unpredictable financial costs.

"Councils are responsible for managing their own budgets, and the level and use of reserves is a matter for them, taking into account local challenges and priorities."