Agenda item

Budget and Council Tax Report 2025-26

Report from the Strategic Director of Finance and Customer Services.

Recommendations:

That Cabinet recommend to Council:

1. Approval of the Budget and Financial Strategy for 2025/26 as set out in the report and appendices, including a basic Council Tax increase of 1% and an Adult Social Care precept of 2%.

2. Approval of the extension to the Local Council Tax Support Top Up scheme, that will provide up to £126.12 of additional support to low income households accessing the Council’s Council Tax Support scheme. It will support the most financially vulnerable to rising household costs, through reduced Council Tax bills as described in Section 2.5.15.

3. Approve the proposed changes to the Local Council Tax Support scheme as set out at 2.5.10 and proposed changes to Council Tax Premiums as set out in Section 2.5.19.

4. Approval of the updated Medium Term Financial Strategy (MTFS) to 2027/28, as described within Section 2.6.

5. Approval of the Reserves Strategy as set out in Section 2.8 noting that the final determination of Reserves will be approved as part of reporting the financial outturn for 2024/25.

6. To note and accept the comments and advice of the Strategic Director of Finance and Customer Services (Section 151 Officer), provided in compliance with Section 25 of the Local Government Act 2003, as to the robustness of the estimates included in the Budget and the adequacy of reserves for which the Budget provides as set out in Section 2.14.

7. To note the feedback from the public and partners following the public consultation on the Council’s budget for 2025/26 which took place from 18 November 2024 to 10 January 2025, attached as Appendix 5.

8. Approval of the proposed increases in Adult Social Care provider contracts and for Personal Assistants as set out in Section 2.4.

9. Approval of the proposed approach and increases in Childrens Social Care costs as set out in Section 2.4.25.

10. Approval of the revenue investment proposals set out in Section 2.7 and Appendix 2.

11. Approval of the proposed revenue savings set out in Section 2.7 and Appendix 4.

12. Approval of the Council Fees and Charges for 2025/26 attached as Appendix 7.

13. Application of the Business Rates Reliefs as set out in Section 2.10, in line with Government guidance.

14. Approval of the proposed Capital Strategy and Capital Programme as presented in Section 2.12 and Appendices 3A to 3F.

15. Approval of the Treasury Management matters for 2025/26 as set out in Appendix 9 of this report including the Prudential Indicators, the Minimum Revenue Provision Policy, the Treasury Management Strategy and the Investment Strategy.

16. Approval that any changes resulting from the Final Local Government Finance Settlement 2025/26 be reflected in the Budget and Council Tax Report to Council on 5th March.

17. Continuation of the principles and measures adopted since April 2020 to make faster payments to suppliers on receipt of goods, works and services following a fully reconciled invoice as described in Section 2.11.

18. Approval of the Budget allocations for the Community Leadership Fund as set out in Section 2.9.

19. Approval that the Capital Programme Budget continues to be managed in line with the following key principles:

i. Any underspends on the existing approved Capital Programme in respect of 2024/25 be rolled forward into future years, subject to an individual review of each carry forward to be set out within the Financial Outturn 2024/25 report to Cabinet.

ii. In line with Financial and Procurement Procedure Rules 7.7 to 7.11 and 8.12, any successful grant applications in respect of capital projects will be added to the Council’s approved Capital Programme on an ongoing basis.

iii. Capitalisation opportunities and capital receipts flexibilities will be maximised, with capital receipts earmarked to minimise revenue costs.

Minutes:

Consideration was given to the report introduced by the Cabinet Member for Finance and Safe and Clean Communities which proposed the Council’s Budget and Council Tax for 2025/26, based on the Council’s Provisional Local Government Finance Settlement for 2025/26, budget consultation and the consideration of Directorate budget proposals.

A review of the financial planning assumptions within the Medium-Term Financial Strategy (MTFS) had been undertaken.

The proposed Budget and Medium-Term Financial Strategy reflected the Council’s priorities as set out in the Council Plan 2022-2025 and Year Ahead Delivery Plan. Thedevelopment of the Budget proposals for 2025/26 and the further update of the MTFStook into account prevailing economic factors, supplier market factors, demand and the complexity of care pressures and the lasting impact of periods of high inflation during2023/24.

Following the Council’s technical MTFS updates, proposed budget decisions

within this report and the impact of the Provisional Financial Settlement, the Council had been able to propose a balanced budget for 2025/26 and 2026/27 with a potential £3.2m funding gap in 2027/28.

The Autumn Statement and Policy update, along with the Provisional Financial Settlement, have given the Local Authority sector a much-needed boost in terms of the funding package available. The confirmation of £1.3bn additional grant for the sector was much needed, with £0.68bn towards Adult Social Care (£3.8m for RMBC) and £0.7bn to be provided through the new Recovery Grant allocated on a deprivation basis (meaning £8.7m of new un-ringfenced grant for RMBC). Whilst some smaller grants have been removed to support this £1.3bn national uplift, overall the funding package represented a substantial increase in Local Authority funding. This settlement represented the most significant increase in core funding in the last fifteen years and the Council would be around £14m better off in 2025/26 than was expected a

year ago.

Though the position for Local Authority Funding had shifted positively, the Council remained committed to increasing efficiency and delivering on the priorities of residents. As such, in order to invest in key priorities, this Budget included Budget savings proposals of £2.6m aimed to increase the efficiency of service delivery and reduce or remove spending on services that were no longer required or can be delivered differently, for example, through maximising grant funding opportunities in Childrens’ Services or route optimisation within Waste Management.

In recognition of escalating cost pressures within Adult Social Care, relating to

increased complexity of care and rising demand for the service, market inflation and transitions, the Council would provide for approximately £17m of additional funding to support the delivery of Adult Social Care services. Further investment of £4.3m would also be provided to address unavoidable cost pressures in complying with Home to School Transport requirements and £1.5m for unavoidable Waste Management costs.

In addition, the Budget would provide some additional investments to help support people and to support with delivering on the Council’s ambitions for the Borough with specific regard to the Council Plan aims of:-

• People are safe, healthy and living well,

• Expanding economic opportunity,

• A cleaner, greener local environment

• One council approach

In setting the proposed 2025/26 budget, Cabinet would be asked to recommend to Council a 3% increase in Council Tax, made up of an increase of 1% in the Council’s basic Council Tax plus an increase of 2% for the Adult Social Care precept.

The Budget also proposed a further year of a Local Council Tax Support Top-up Scheme to operate across 2025/26 to provide further support to low income working age households in the Borough to assist them in managing the impacts of the cost-of-living crisis and support the most financially vulnerable households.

The Chair invited questions from members of the Board and a discussion on the following issues ensued:

Councillor Yasseen noted the persistent overspends within the Children and Young Peoples Service’s budget year on year, querying why these had not been addressed. The Leader noted that there were a number of factors outside of the Council’s control, such as the number of children in care and the costs of external residential placements. The number of children in care had been decreasing over the last two or three years. Work was undertaken each year to consider what children’s services needed, where the potential spend was going to be, along with how many children would become 18 or 21 years old and would require different care packages. There was more demand than supply in the national residential care market meaning that costs were higher putting additional pressures on the Children and Young People’s Service’s budget. The Council had a programme to develop its in-house residential care provision, which was a little delayed but meant more places would become available over the next few years and would provide more certainty around costs.

It was clarified that officers progressed through a series of panels and decision-making points when placing a child in care, along with a dedicated commissioning team who role it was to work with providers to ensure the required services were delivered as efficiently as possible.

Councillor Pitchley expressed concerns around the impact of concluding the PAUSE programme, specifically what would happen to the existing service users. The Assistant Director, Education & Inclusion gave assurance the proposed changes to services would provide a better service for service users than they currently received. These proposals would improve efficiencies and effectiveness through the restructuring of teams, which would remove duplication, create improved responsiveness and more effective pathways along with providing the ability to optimise grant funding opportunities. It was confirmed that the women who were currently with PAUSE would continue to receive the services. One of the limitations to the PAUSE programme were the restrictions as to who could access the service, by reintegrating it into existing services, it would increase the level of access to the service and the Council would look to redeploy the staff within existing services.

The Chief Executive explained that staff vacancies within Children’s Services had been held previously due to the volatile nature of the service. The vacancies listed within the report had been held for a significant time before a decision was taken that they would not be required to ensure there was no future requirement for those positions.

The Cabinet Member for Children and Young People was assured that the women who needed that support would continue to received and then explained the transition for those service users already engaged with the PAUSE programme, would be seamless.

In response to Councillor A Carter’s query the Assistant Director, Education & Inclusion explained that the number of children in care in Rotherham has been decreasing due to the work being undertaken. The Leader noted that the Council was managing to support children in the family settings much more and the numbers would be lower were it not for the number of unaccompanied asylum-seeking children within the borough.

In response to the Chair’s query the Chief Executive explained route optimisation was a technical methodology that considered if you took more right turns that would you stop more to let traffic go past and calculates on average how many seconds that took. This methodology was used by lots of authorities to make them more efficient as you would not be crossing the traffic in the same way if you took more left turns. This would then run through different scenarios about how many rounds the council had, how many bins, the type of topography and when combined it would provide information on the best route. The Strategic Director for Regeneration and Environment noted that route optimisation not only provided savings in time but also fuel.

In a response to the Vice-Chair’s query the Leader explained part of the proposal was the need to use fewer vehicles and the capital investment paper included a proposal for the purchasing of vehicles, so the combination of both aspects would address the use of hire vehicles and agency staff. The Strategic Director for Regeneration and Environment explained that agency staff were used to cover staff sickness in the service but if as part of the re-optimisation process the number of rounds were reduced, then the Council would be able to reduce the number of agency staff used. In terms of vehicles, the fleet replacement would be like for like. The costs for hiring vehicles were significant because the Council had an aging fleet. The fleet replacement programme would resolve that and there was an intention to retain one or two of the vehicles that could be used in the event of breakdowns. Further concerns were voiced regarding the impacts of the reduce number of collections rounds so it was proposed that a progress update be provided to OSMB within twelve months of implementation.

While considering the investment proposal for the Street Safe Team the Leader explained that the proposal was to have a familiar face representing the Council within communities with a view to reducing antisocial behaviour. In response to a question by the Vice-Chair it was noted that the programme would be set up and rolled out in a considered approach, with a view to expanding the service in the future, if appropriate.

Councillor A Carter expressed concerns that this service would not be utilised across the borough, only in the town centre, with staff having minimal enforcement powers against antisocial behaviour. Councillor Yasseen indicated that a broader role should be undertaken around education and relationship building within communities. This would impact on the role of the neighbourhood teams, who were already trusted within communities. The Leader explained the Council was bound by its resources and whilst utilising the service across the borough would be welcomed, there was a need to focus this initially in the most populated areas. This proposal may also compliment and assist with the regeneration of the town centre. The shared enforcement arrangement with Doncaster was still in effect. It was clarified that other enforcement officers would not be used for this purpose as the proposal was around officers becoming trusted advocates within communities, educating them and enforcing when necessary, working alongside the police.

Councillor Tinsley and Councillor Marshall welcomed the proposal noting that it would assist with aspects such as road safety around schools and help communities feel safer but that it would be reviewed following implementation. The Chair suggested that an update on the progress following the implementation of the Street Safe Team programme be brought back to OSMB within twelve months. This was to review the results and the effects of the programme within the proposed areas and lessons learned.

In response to Councillor A Carters question the Leader clarified that consideration had not been given as to how to manage any potential fines from the proposal at this time and the model was not financed by enforcement activity.

In response to Councillor Blackham the Chief Executive explained that the Council already ran a community protection unit along with staff who had a range of different enforcement powers, so were able to provide training and support. It was also working with the police through a number of shared and integrated teams and that experience would be drawn on to support staff ensuring they were protected. The community was generally good at ensuring the right information went to the right person and creating those relationships would help them to know who was best to intervene.

The investment proposal within the Employment Solutions Team was considered and the Vice-Chair and Councillor Blackham raised queries regarding the performance information for the team and whether the ‘Free Courses for Jobs’ DfE funding allocated to the South Yorkshire Mayoral Combined Authority could be used to assist this team. This information was not available during the meeting and would be provided in writing.

In response to a question from Councillor Mault, the Leader confirmed that the hiring of vehicles for the investment proposal relating to Street Cleansing and Fly Tipping Improvements was temporary whilst a procurement exercise took place.

It was noted that the Council was working with providers to provide additional support around the food banks, and social supermarket offer, which included the proposal of additional support from a community organisation that operated within Sheffield called Food Works. In order to respond to a query raised by Councillor A Carter, information on the funding model for Food Works would be provided to OSMB.

The investment within the Customer Services team was welcomed, however Councillor Carter noted that some online customer interactions were no acknowledged, so did not provide residents with confidence that their query would be responded to. The Leader explained that new IT systems were being introduced and procured to address this in the future.

The investment in the Capital Programme was noted and in response to queries by the Vice-Chair, the Strategic Director for Finance and Customer Services provided clarification on the internal monitoring processes, along with confirming that members had regular opportunities to review the programme through Cabinet. The Chair noted that training had recently been provided, via the Centre for Governance and Scrutiny, to the Chair of OSMB and the Chair of Audit Committee, who had volunteered to take part, which considered how the two bodies could work more closely whilst retaining their individual responsibilities.

Councillor Blackham suggested that a report on the capital programme should be presented to the Board on a regular basis for monitoring purposes. The Chief Executive noted that members already received information on the capital programme, and updates were presented as part of the financial monitoring report. The Chair suggested that a meeting being arranged with Councillors, Steele, Bacon, Blackham, Marshall, and Baggaley along with officers to consider the most appropriate manner to monitor the Capital Programme going forward.

In response to a query from the Vice-Chair, the Leader noted the Council was halfway through delivery of a programme of capital investment in a local neighbourhood road safety programme, therefore work was ongoing.

The Chair thanked the Leader of the Council, Cabinet Members and members of the Senior Leadership Team for their attendance.

Resolved:- That Cabinet be informed that the following recommendations be supported:-

1. That a recommendation be made to Council for the approval of the Budget and Financial Strategy for 2025/26 as set out in the report and appendices, including a basic Council Tax increase of 1% and an Adult Social Care precept of 2%.

2. Approval of the extension to the Local Council Tax Support Top Up scheme, that will provide up to £126.12 of additional support to low-income households accessing the Council’s Council Tax Support scheme. It will support the most financially vulnerable to rising household costs, through reduced Council Tax bills as described in Section 2.5.15.