Falkirk Council will have to find another £20 million of savings to balance the books next year.
Under pressure service bosses have warned some “very tough” choices will have to be made in the months ahead.
The Scottish Government is expected to announce how much financial support the council will receive in 2017/18 before Christmas.
Chief finance officer Bryan Smail said the time frame is very challenging.
In his budget update to councillors he said: ““Based on advice from the Scottish Government the council should be preparing its 2017/18 budget on the basis of a similar grant level to 2016/17. This implies a budget gap for Falkirk Council of around £20 million.
“There still remains considerable uncertainty underpinning this estimate including the amount of Integrated Joint Board funding and whether allowance is made for the full year funding of the Living Wage. The impact of the Apprenticeship Levy is another area of uncertainty as is the level of pay awards to council employees to be negotiated nationally.
“Going forward, members will have to make some very difficult decisions.”
Council officers are already looking at where cuts could be made and will produce a list of the savings options to the Executive next month. Councillors have been warned some of the savings may only be achieved by redundancy.
Mr Smail said: “The position remains uncertain until the announcement of the local government settlement. It is inevitable that savings of the magnitude implied in this report will have a material impact on the council’s service delivery capacity, internally as well as externally, and on jobs.”
The expected three per cent rise in council tax now that the freeze has been lifted will contribute to closing the gap, but with the government already committed to using £100 million of the extra income to support its schools programme, it will not provide a cash boost as big as might have been hoped for.
Council leader Craig Martin called for cross party working to agree a way forward.
He told the council: “The Scottish Government have their funding priorities and local authorities are not one of them. It is important all groups work together to face the challenges.”
Councillor Cecil Meilklejohn, leader of the SNP Group, claimed: “The challenges are the result of the austerity measures imposed by Westminster and that agenda has been supported by Labour.”