The leader of Labour-run Liverpool City Council has rejected calls for the authority to ignore government spending targets and set an illegal budget.
The council has to save £102m from its budget over the next three years.
At a public consultation demonstrators called for an illegal budget to be set, as the city did in the 1980s.
Liverpool Council leader Joe Anderson said: "Times have moved on, not only can we not set an illegal budget, but we won't set an illegal budget."
In the 1980s the Labour-controlled council set an illegal budget which led to the banning and surcharge of 47 Labour councillors.
Plan for future
The meeting at the city's Town Hall on Thursday evening, attended by about 200 people, was for residents to offer their opinions on how services should be affected by budget cuts.
Mr Anderson said: "There was a group of people, about twenty inside and fifty outside demonstrating, who were hell bent on arguing that I should set an illegal budget
"If we don't set a legal budget then, within a couple of weeks, somebody from Whitehall will come in and run this city.
"If that happens we won't be able to do the things we're doing now and we won't be able to plan for the future."
Jane Calverley from Toxteth, who was at the meeting, said: "It seemed to just be about the council taking the opportunity to tell us how difficult things were for them and really they weren't listening to what people were saying.
"They kept saying we are tied in to contracts because of the previous administration or these are Tory cuts.
"It was everybody's fault except their own, I didn't feel that the public were listened to at all."