Doncaster Council's top officer is to hold meetings with the boss of the town's children's services over concerns it has spent millions over its budget.
The trust is one of six in Yorkshire expected to be overspent by millions because of increased demand on their services.
Council chief executive Jo Miller warned the authority's cabinet that if no action was taken on overspending by the organisation, an independent trust which took over the running of children's services from the local authority, then if could threaten the viability of the council's finances.
A report by the council's chief finance officer, Steve Mawson, warned Doncaster Children's Services Trust was projecting an overspend of £2.98 million - up by £1.35m from £1.63m in quarter two.
The pressures are mainly due to more children in care and the cost of more complex cases, and the council is liable to fund £940,000 of the figure, under a agreement which puts 70 per cent of the financial risk on the council's shoulders. But because the children's trust only has £70,000 in reserves, the report said it was expected the council would meet the cost from its own reserves.
The council as a whole has forecast an overspend of £3.8 million including the children's services money.
Doncaster Council chief executive Jo Miller said it was getting harder and harder each year to make the cuts that the council has had to make since the Government brought in austerity policies in 2010-11.
But she added it was important that bosses knew about any overspend straight away if they arose.
She said it was a big increase in the children's services overspend, but because it was quite late in the financial year, it was difficult to recover the situation.
It was vital that the council maintained minimum cash reserve levels - enough to run the council for two weeks.
She said she was now holding weekly meetings with the chief executive of children's services to look at the finances.
She added: "We cannot have commissioned services threaten the viability of finances as a whole, and if we do nothing, that's the position we're in."
She said they must make sure it did not get any worse, adding she accepted that a lot of the overspend was down to extra demands on the system which had happened across the country.
"We have to do all we can to make sure the year end position is as good as it can be," she told cabinet.
"We will continue to report to the the executive and the cabinet to make sure we have got confidence we have the right information at the right time and that they are doing all they can to live within their means."
Other overspends were £700,000 in waste and recycling following the introduction of a new contract, £500,000 in school catering due to reduced income.
Coun Chris McGuiness said authorities all across the council were having problems balancing their books, included 'wealthy' areas such as Surrey.
A Doncaster Children’s Services Trust spokesperson, said: “Six councils in Yorkshire, including Sheffield, Bradford, Rotherham, Leeds and Calderdale, are also expecting to be millions over budget for spending on children’s services this year due to increasing demand on services.
“Our focus is always on the child’s best interest but there are of course cost implications to this. A child only becomes looked after in Doncaster when all options have been explored, as was highlighted in our recent Ofsted inspection when we were rated as ‘Good’.
“We have been working with the council to tackle this increasing demand on our services.”
The children's services trust hit the headlines earlier this year when it was rated by Ofsted as 'good' after turning things around from 'inadequate' when the trust first took over the role.