Agenda item

To consider a report by the Head of Finance and Audit (copy enclosed) updating Cabinet on outstanding matters relating to 2025/26 budget, sets the scene for budget setting in the medium term (2026/27 – 2028/29), and updates the self-assessment of the Council’s level of financial resilience and sustainability.

RESOLVED that Cabinet approves the updates as listed in section 2.1 of the report.

The Head of Finance and Audit presented the report providing an update on outstanding matters relating to the 2025/26 budget, budget setting in the medium term (2026/27 – 2028/29) and updated self-assessment of the Council’s financial resilience and sustainability.

Cabinet was guided through the report detail which focused on the following –

·       a final version of the 2024/25 savings tracker which showed that 82% of major savings proposals and 92% of non-strategic savings had been achieved

·       Council having set the 2025/26 budget and Council Tax on 20 February 2025 with a small increase in the final local government settlement of £29,659

·       Medium Term Financial Strategy and Plan 2026/27 – 2028/29 including current budget projections along with assumptions that underpinned the projections and the Council’s strategic approach to the management of its finances and outlined some of the financial issues facing the Council over the next 3 years, and

·       self-assessment of financial resilience and sustainability setting out an assessment of the Council’s position against common themes and issues identified by CIPFA (Chartered Institute of Public Finance & Accountability).

The Leader thanked the Head of Service for the comprehensive report which highlighted the financial challenges ahead and put into context the difficult decisions which had to be made, citing the previous item on Public Conveniences as a case in point.  He also took the opportunity to thank Councillor Gwyneth Ellis for hard work over the last three years as the Lead Cabinet Member in that regard.

The Chief Executive referred to the estimated £11m pressures.  Work had been carried out to reduce those pressures which involved a combination of approaches via savings and increased income.  Difficult decisions regarding savings needed to be made taking into account the overall financial position and whilst there was some criticism that individual decisions were taken in isolation, and the amount saved relatively trivial in comparison with the overall budget, the MTFS set out the scale of the financial challenge and all those savings and elements combined would be required to deliver a balanced budget.  It was right to have that test and challenge when discussing individual savings proposals, but it was also important to consider the overall financial context in which those decisions were being made.

The Head of Finance and Audit responded to questions raised as follows –

·       following a recommendation from the Governance and Audit Committee the estimated percentage increase in the level of Council Tax required to fully fund the pressures, assuming no savings achieved or increase in the Revenue Support Grant, had been included within the Medium Term Financial Plan.  It was a theoretical figure and the Council’s approach to funding the budget gap to date had been a combination of savings/efficiencies and increase in Council Tax

·       agreed that communication with residents around the budget was important but also challenging given the complexities around local government finances and work was ongoing in this regard with a workstream looking at budgets and transformation communications.  The Council Tax leaflet had been updated detailing the cost of services and myriad of responsibilities the Council had.  Given the ongoing nature of the need for that work the Head of Service agreed to provide a report back to Cabinet specifically on that communication work

·       the original budget saving following the review of Libraries Provision was £360k; £300k had been achieved in 2024/25 due to the changes being implemented in June 2024 and therefore the full year impact had not been achieved.  However, £360k would be achieved in 2025/26 given it was a recurring saving

·       the risk around the new financial system was highlighted given it was the first time a financial year would be closed down on the new system. The new system had been a quite a change within the Council, but good progress was being made and early indications of the closedown of the financial year was positive

·       in terms of progress with transformational projects a Members Workshop had been held prior to the Council setting the budget which contained detail around individual projects which could be re-circulated to members and assurances were given regarding the governance and structure set up around that process with regular reporting on progress.  Given concerns raised by Councillor Gareth Sandilands regarding the absence of scheduled transformational projects in the scrutiny forward work programme the Head of Finance agreed to take the matter up directly with the Transformational Project Team.  The Corporate Director: Governance and Business added that as and when those individual projects needed decisions, they would go through the democratic decision making process which would involve the Scrutiny Committees.

RESOLVED that Cabinet approves the updates as listed in section 2.1 of the report.