Wakefield council chiefs were yesterday in talks with the district's four MPs following the revelation that the local authority has £9m invested in stricken Icelandic banks.

The council yesterday stressed there will be no immediate impact on "jobs, services or council tax" – but admitted there were concerns in the long term if the cash was not returned.

A delegation of officials from the Treasury were this weekend meeting their counterparts in the Icelandic capital Reykjavik, in a desperate bid to claw back as much money as possible.

West Yorkshire Police Authority has £6m and Kirklees council £1m invested in Iceland's crippled banking sector.

Wakefield council had invested three blocks of £3m in three separate Icelandic banks. That money was due to mature in May of next year.

Wakefield MP Mary Creagh said: "There is no immediate risk to Wakefield unlike other councils because we do have a window of time before it becomes an acute issue.

"The council spread their risk, they didn't put it all in one bank and they followed Treasury rules. We need to get the money back."

Hemsworth MP Jon Trickett added: "There is time to make proper provision but obviously there are concerns when significant sums like this get put on ice."

A Wakefield council spokesman said: "There will be no immediate impact on jobs, services or council tax levels but we will obviously have to examine our position in the longer term if we do not get the money back."

The Government has remained firm that it has no intention of bailing out the public or voluntary sector.It has agreed to give councils greater flexibility to borrow extra cash to use for revenue purposes and allow some town halls to defer passing on business rates to the Treasury for a limited period.

More than 100 councils and other public bodies nationwide have been caught up in the crisis.