Issue - meetings

Report from the Strategic Director of Finance and Customer Services.

Recommendations:

1. That Cabinet note the Medium Term Financial Strategy 2025/26 to 2028/29 update.

Consideration was given to the report which set out an update of the Council’s Budget and Medium Term Financial Strategy (MTFS) to 2028/29, including the standard technical updates required, recognition of financial pressures impacting the delivery of services and the ongoing impact on the Council’s base costs of inflation.

The  ...  view the full minutes text for item 74

Report from the Strategic Director of Finance and Customer Services.

Recommendations:

1. That Cabinet note the Medium Term Financial Strategy 2025/26 to 2028/29 update.

At the Chair’s invitation, Councillor Alam, Cabinet Member for Finance & Community Safety introduced the report explaining that the reports was an update on the council’s budget and the medium-term financial strategy to 2028-29. It included the standard technical base required, recognition of financial pressures impacting service delivery, and the ongoing effect of inflation on the council’s base costs.

The technical adjustments also included the council’s assessment of the potential impact of the government’s fair funding review, which aimed to make significant changes to the way local authority funding was allocated. The review was expected to introduce major changes to the formulas used for funding distribution, and it appeared that more areas would require additional funding.

The medium-term financial strategy was scheduled for further revision ahead of the council’s budget-setting in March 2026 to reflect the local government settlement once issued, along with budget policy proposals on council tax levels, reserves, fees and charges, and any required budget savings.

The funding review represented the most significant change in local government funding approaches for many years and introduced a degree of uncertainty. The medium-term review sat alongside financial monitoring, which was presented to Cabinet and projected a financial overspend of £0.9 million.

Council tax collection rates remained strong despite cost-of-living challenges faced by residents and businesses. However, due to the impact of Speciality Steel, there was a potential effect on business rates. The Council expected to balance its budget to the outturn position before year-end, although risks remained, and the use of reserves might have been required.

Judith Badger, Strategic Director for Finance and Customer Services followed on by explaining to members that this was a point in time based on the Council’s best understanding of the situation, with some significant changes since the budget was set in the Medium-Term Financial Strategy (MTFS) back in March.

Members of Scrutiny were due to receive the presentation on the final MTFS near budget time in the usual way, but an update at this point in the year was provided to bring members up to date with how the position was looking. It was a plan based on planning assumptions, estimates, and available information, and the government’s budget at the end of the month was expected to give some indications of new factors to consider and whether they aligned with the Council’s expectations.

The Strategic Director for Finance and Customer Services pointed out to members that this reflected only the national policy position and not the Council’s settlement. The actual settlement, knowing how much money the Council would receive from government, was not expected until quite close to Christmas, likely late December. So, this was presented to bring members up to speed, but it was highly likely the position would change again later in the year when the Finance team took Members through the detail before budget setting.

The Chair asked Rob Mahon, Assistant Director, Financial Services to run through the key changes concentrating on the children's services aspect. The Assistant Director, Financial Services noted  ...  view the full minutes text for item 58