Council chiefs have halved the deficit on collecting rubbish and removing waste from streets.

When Brighton and Hove City Council took over the waste contract six months ago from the private firm Sita it estimated the move would trigger a £1.52 million overspend in the council budget for the rest of the financial year.

But latest figures show the overspending has been reduced to a likely figure of £781,000. Although the financial year ended at the end of last month, the council is still calculating its final figures.

One of the main reasons for the saving is that outstanding claims by Sita have now been resolved.

Another is greater efficiency within the service.

Cabinet environment councillor Chris Morley said: "This is excellent news. It's a tribute to all the hard work our refuse and street cleaning staff have put in.

"It underlines our determination to deliver a better service while keeping costs under control."

The council has also gained an extra £235,000 from on-street parking and penalty charges which have been more than expected.

Street lighting is likely to be underspent by £100,000 because penalties have been levied on the contractor for not keeping up to the council's standard.

But the council has not been able to reduce the huge overspending on homelessness and the latest figures show about 550 households being put up in board and lodgings.

Overall, the council has been able to reduce overspending by £1 million in the last two months.

At the end of last year bosses were predicting a total overspend of around £5 million.