Powys County Council still has to make savings of more than £7.1m this financial, councillors will be told.
It has emerged that as part of the council's attempts to save money it had made savings of £5.125m by the end of September, 42 per cent of the overall savings needed.
In a report by Cllr Aled Davies, Portfolio Holder for Finance, he says the council's revenue expenditure this financial year is expected to be £3.8m over budget.
"On the basis of expected savings delivery and capitalisation of transformation costs the projected position will be an overspend of £3.8m against the proposed budget," he said.
In August the council had a projected overspend of £5.804m.
The council is attempting to make savings across its departments and is not filling some job vacancies.
The council is facing escalating costs within its children's services. This follows a critical report of the department earlier this year.
It is understood the cost of agency staff is one of the key areas for higher expenditure as the department faces difficulties in recruiting new staff.
"Costs continue to escalate within Children services with a projected overspend of £6.026m for the year, an increase of £483k since that reported in August, due to an increased cost of placements, agency staff and legal fees," says the report.
An overspend of £955,000 is also expected within the schools service. It says severance pay, schools improvement, home to school transport and other areas within the department will overspend.
The council's Cabinet will consider the report on Tuesday.
