The authority has around £3 million invested in Heritage, one of Icelandic banks which collapsed this week.

This comes after the news that Herts County Council has £28 million tied up in three of the country's bust banks.

The £3 million is part of the authority's reserves, to be used if they encounter any unexpected costs during the year.

An HPA spokesman said: "There's no risk at the current time to the high levels of police services we currently provide.

"We are trying to seek assurances from the Home Office that long term finances will not be affected by the current financial crisis.

"It's too soon to say how it's going to impact upon council tax."

The reserves total around £8 million, with the authority's annual budget around £198 million. Around two thirds of the budget is provided by the Government with a third coming from council tax.

Dacorum Borough Council, meanwhile, has moved to reassure taxpayers that their money is safe.

A spokesman said: "Dacorum Borough Council is reassuring residents that it has no money invested in Icelandic Banks.

"To limit our exposure to risk the money we have invested is spread between 18 different financial institutions, the majority of which are UK or Irish Banks.

"The money we have invested changes on a daily basis as we withdraw money to pay bills and recoup income owing to us.

"Given the current financial uncertainty we are taking an increasingly cautious and prudent approach to our investments.

"Any new investments are being placed with UK banks or with Irish Banks where there are government guarantees in place."



A spokesman for the county council said they were waiting for developments and they would do what they could to ensure taxpayers' money remained safe.

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