Doncaster councillors have conceded more tough decisions will have to be made in order to balance the books.
A report presented to council cabinet members showed the local authority’s overspend in the first financial quarter stood at £3.6 million.
But finance chief Debbie Hogg said the council had 'got off to a good start' and was ‘holding its own’.
The main overspend is the well-document performance of Doncaster Children's Services Trust with an overspend of £5.2 million from a budget of £45 million.
Around £700,000 was over spent in the adult social care budget. Bosses put this down to 'additional costs of placements in care and shortfall in some savings targets'.
But the local authority found savings of £2.1 million from 'other council-wide budgets' and £700,000 from corporate resources, namely from staffing budgets.
Conisbrough councillor Nigel Ball cited large capital projects and said Doncaster was a ‘forward thinking council’ which was ‘growing out of Tory austerity’.
Coun Chris McGuinness, who represents Armthorpe, said problems could hit over the next few years.
Coun Ball said: "“This report is broadly welcomed and and clearly Doncaster Council is forward thinking and forward moving in terms of moving together and developing as a local authority.
“Some of the capital builds that are in place and some of the developments are already in the pipeline and are coming to fruition – it just shows we’re a forward thinking local authority growing ourselves out of Tory austerity.
Coun McGuinness added: "When you see 80 per cent of the indicators are green or amber and if anyone saw the news about Somerset Council and whats going on in Northamptonshire and other places, under the circumstances, it’s actually very good.
“The picture of where we are at the moment, the problems are going to be over the next few years.
“But at present, we seem to be faring better than other councils.”
Deputy Major coun Glyn Jones, said: “There are some issues that we have to face in the future regarding the finances of the council and associated bodies that really need tackling.
“We need to be all over that to ensure to the best of our ability we have a balanced budget for the end of the (financial) year.”