Councillors have instead asked for new proposals to be developed for delivering the services in-house with specialised support.

The decision was taken at yesterday’s finance and resources committee meeting as part of a range of proposals which aim to provide a framework to tackle the budget shortfall.

Councillors also asked for further discussions about the issue of compulsory redundancies, with a report to go to the next meeting of the committee at the end of next month.

The local authority had earlier suggested that as many as 2,000 jobs could be lost.

The four-year budget framework that was agreed will now form the basis of the council’s annual public engagement exercise, which will start next Monday.

Councillor Alasdair Rankin, finance convener, said: “This is the start of a long process. There were some important decisions made today and we have agreed the framework for achieving the savings needed over the next four years.

“With greater demand for our services and our overall budget remaining the same we need to take action to ensure we safeguard frontline services for the people of Edinburgh.

“We are very clear about the scale of the financial challenge that the council is facing we will work tirelessly to ensure that the services we provide are the ones which people need and want. The decisions taken today are the next step to achieving this.”