BOSSES have been accused of running Hyndburn Council like Toytown after it went deep into the red for the second year running.

The authority faces more cuts to prevent it going £420,000 into debt, less than 12 months after arrears were almost £2million.

Tax-payers could face shouldering the burden, and department heads at the council have been ordered to tighten their belts and find ways to save money.

A cabinet meeting yesterday was told how up to the end of July, just four months into the financial year, they had already been left with an overspend of £24,382.

If the spending carries on, a £420,000 deficit is forecast. That money would have to come from council reserves -- which would then be topped up with an increase in the council tax.

Coun Jean Battle, leader of the opposition on the council, said: "It's obvious they aren't making savings from within the council.

"At this present time the council seems to be run like Toytown."

But Tory council leader Coun Britcliffe has reassured the public that it is not time to panic. He said many of the forecasts could be incorrect, or may change later in the year.

According to a council report presented to the meeting, the main causes of the overspend include low income from trade waste and pest control services, and additional pension costs.

Coun Britcliffe said: "It's a third of the projected overspend at this time last year. I am not saying we need not be concerned but what I am saying is lets not get too alarmed at this stage."

And Coun John Griffiths, the council's portfolio holder for resources and performance management, slammed council chiefs for not making savings.

He said: "This isn't a game, it's very very serious. We need all service managers to stop spending where it's not essential."

Hyndburn's Labour MP, Greg Pope, who criticised last year's financial mess, said: "There are people's jobs and crucial services at stake and there is a duty on all of us to put aside our party political differences.

"It wasn't realistic to think that come the next financial year everything would be rosy. It was always going to take a while for them to get back on track, but this is far from satisfactory."