Although Local Councils believe they are run like business, in that each department has a budget, this is as far as it goes. For as long as I can remember, councils have been unable to plan for the long term. Just look at what some do, patch roads instead of resurfacing. This is a short term measure as a patch will not last as long as a complete resurface, but is of course cheaper on costs in the short term. In Social Housing many councils will only do emergency repairs as and when required, when a full repair of required areas would be more cost effective over the longer term, but each individual emergency repair is cheaper. But how many emergency repairs are required over the long term and then totally are most expensive than the full repair.
Also in Sheffield there are a number of council run attractions, such as health centres, libraries, etc. Most people attending these attractions spend a good part of the day there, but do the council have any outlet for refreshments, in that they have to some extent a captive cliental. Just look at privately run outlets from DIY centres, garden nurseries and garden centres to large departmental stores and shopping centres, all have at least one refreshment outlet.
But to add to council expenses previous governments have increased staffing costs.
Local councillors were not paid expenses until 1970, by Edward Heath. But they did not gain access to Local Government Pensions until 2003, a luxury made possible by Tony Blair. This is a perk which the current government are looking to stop.
Re paying expenses, surely this was good, as it enabled all eligible UK citizens to stand, not only the rich. To then offer pensions as well was totally overboard, but that is in keeping with Labour policies.
As to keeping reserves, where possible this should be encouraged, as it provides a safety net for lean times. Are these lean times and should therefore some of the reserves be brought into the current spending calculation. If so, then only the part of the reserves not already earmarked for other projects could be used.
But remember when reserves have been exhausted, there are no more should times become even leaner.