A new houshold waste and recycling contract is set to save South Ribble taxpayers £600,000 a year.
Waste management company FCC Environment will take over bin collections in June, and the contract will run for seven years - saving a total of £4.2m.
Council bosses said collections will not change and all staff will be transferred under the new deal. It will also allow for £1m to be spent on five new ‘green’ wagons.
The saving will help the council balance the books, after it learnt the grant allocation it receives from central government would be cut again in 2015/16.
The council’s budget for the year ahead was discussed on Wednesday, when committee members voted through the Conservative-lead council’s proposals.
They in a council tax freeze, a new apprenticeship scheme and regeneration plans for Leyland, Penwortham and Bamber Bridge. The plans will now go before full council in March.
Cabinet member for finance, Coun Stephen Robinson, said: “We exceeded our efficiencies this year, and are forecasting that there will be no need to go into our reserves to balance the books for 2014/15.
“Using our crystal balls, we expect we will need to take £185,000 from reserves in 2015/16.
“We are leading the way in economic growth, and we have a major role in the City Deal.”
Leader of the Labour party, Coun Matthew Tomlinson, said he ‘warmly welcomed’ parts of the budget, in particular the personal budgeting service. But the group is preparing an alternative budget ahead of the March meeting.