OK. Council reserves cannot be used for day to day operations except in a small shortfall in some operational costs e.g. uninsured loss of a flooded building or extra costs for CYP or ACS. It cannot be generally budgeted for except for a small amount such as a couple of million. The reserves can also be money held by the council for other parties, so while they show on balance sheets, they are not council money. Also, money borrowed to use on a project will be shown there so while it looks good it is also spoken for much as if you borrow money to pay for an extension, your bank balance goes up. A lot of rules apply to how councils can spend their money which is why they have a section 151 officer who has a legal duty to ensure that these rules are followed.
So it's not all just sat in an account waiting to be spent.