Decision

THAT It is recommended by the S.151 Officer that
the Council approve the following, all subject to receiving an
"In Principle" decision from Central Government for Exceptional
Financial Support:
 
(a)           
(amended recommendation) The revised Revenue Budget for the
financial year 2025/26 and the Revenue Budget for the financial
year 2026/27 as set out in the General Fund Summary (Appendix 1
amended) which includes:
(i)             
Exceptional Financial Support of £12.9m
(ii)            
Additional spending in Adult Social Care of £14.8m and
Children's Services of £3.9m
(iii)          
Additional Waste Services costs of £6.5m
 
Appendix 1 (Amended) includes the following
changes listed in the tables below:
 
i)               
Additional Savings/Reduction to Reserves - Reductions
to Budget Estimates
 

Committee/ Item
Description

2026/27
£

2027/28
£

2028/29
£

2029/30
£

Environment &
Community Protection

New

Introduce new charges for DIY & Rubble
Disposal Scheme

(100,000)

(100,000)

(100,000)

(100,000)

 

Sub-Total

(100,000)

(100,000)

(100,000)

(100,000)

Policy, Finance and
Resources

New

Reduce Transformation Reserve

(413,725)

0

0

0

New

Reduced Revenue Contribution to Capital

(257,275)

0

0

0

 

 

(671,000)

0

0

0

 

Total

(771,000)

(100,000)

(100,000)

(100,000)

 
 
ii)             
Additional Costs - Additions to Budget
Estimates
 

Ref No

Increases to
Committee Budgets

2026/27
£

 

 

2027/28
£

2028/29
£

2029/30
£

 

 

Economy, Regen,
Transport & Infrastructure

25

Withdraw - On Street Parking - Increase in on
street parking charges by 25p per hour

122,000

 

 

152,000

152,000

152,000

26

Withdraw - Off Street Parking - Increase off
street parking charges by 25p per hour

119,000

 

 

149,000

149,000

149,000

27

Withdraw - Introduction of Parking charges for
Union Street Ryde

56,000

 

 

112,000

112,000

112,000

28

Withdraw - Introduction of Parking charges at
Crocker Street Newport 

11,000

 

 

21,000

21,000

21,000

29

Withdraw - Introduction of Parking charges at
Sandown High Street

15,000

 

 

30,000

30,000

30,000

30

Withdraw - Introduction of Parking charges at
Shanklin Regents Street

26,000

 

 

51,000

51,000

51,000

31

Withdraw - St. James Street - implement on
street charges (order)

19,000

 

 

39,000

39,000

39,000

32

Withdraw - Egypt Esplanade Cowes and Princes
Esplanade Gurnard - implement on street charges (order)

16,000

 

 

66,000

66,000

66,000

33

Withdraw - Fort Victoria Pay and Display

19,000

 

 

19,000

19,000

19,000

34

Withdraw - Floating Bridge - Increase foot
passenger prices by 50p/£1/£1 for saver card/casual
single/casual return. 

149,000

 

 

149,000

149,000

149,000

35

Withdraw - Introduce new charge for under 19s
on the Floating Bridge.

5,000

 

 

11,000

11,000

11,000

38

Withdraw - Close Roman Villa to the public but
continue to maintain the asset

6,000

 

 

6,000

6,000

6,000

39

Withdraw - Duke of Edinburgh Service - Cease
provision of the support service.

15,000

 

 

15,000

15,000

15,000

 

Sub-Total

578,000

 

 

820,000

820,000

820,000

 

 

 

 

 

 

 

 

 

 

Environment &
Community Protection

22

Withdraw - Open each HWRC 4 days/week
(Lynnbottom ? from 7 ? 4; Afton Marsh ?
from 3 ? 4) OR equivalent hour change

93,000

 

 

93,000

93,000

93,000

 

Sub-Total

93,000

 

 

93,000

93,000

93,000

 

 

 

 

 

 

 

 

Policy, Finances
& Resources

 

 

 

 

 

 

47

Amend - Staff Reduction Programme (from
£641,000 to £541,000)

100,000

 

 

100,000

100,000

100,000

 

Additional EFS Debt

0

 

 

101,444

214,160

339,400

 

Sub-Total

100,000

 

 

201,444

314,160

439,400

 

TOTAL

771,000

 

 

1,114,444

1,227,160

1,352,400

 
(b) 
Any variation arising from the Local Government Finance Settlement
2026/27 or any further savings made in 2025/26 or 2026/27 arising
at the year-end be used to reduce the draw down of Exceptional
Financial Support (thus minimising debt costs) or alternatively,
transferred to the Revenue Reserve for Capital, Transformation
Reserve, and General Reserves with the level of each transfer to be
determined by the S.151 Officer.
 
(c)  
That the level of Council Tax be increased by 2.99% for general
purposes in accordance with the referendum threshold[1]
for 2026/27 announced by Government (as calculated in Appendix
2)
 
(d) 
That the level of Council Tax be increased by a further 2.0% beyond
the referendum threshold (as calculated in Appendix 2) to take
advantage of the flexibility offered by Government to implement a
"Social Care Precept"; and that in accordance with the conditions
of that flexibility, the full amount of the associated sum
generated of £2,326,800 is passported direct to Adult Social
Care
 
(e) 
That the amounts set out in Appendix 2 be now calculated by the
Council for the financial year 2026/27 in accordance with Section
31 and Sections 34 to 36 of the Local Government Finance Act
1992
 
(f)   
The S.151 Officer be given delegated authority to implement any
variation to the overall level of Council Tax arising from the
final notification of the Hampshire Police & Crime
Commissioner, Hampshire & Isle of Wight Fire & Rescue
Authority and Parish and Town Council precepts, and amend the
calculations set out in Appendix 2 accordingly
 
(g) 
(amended recommendation) The savings proposals for each Committee
amounting, in total, to £3.500m for 2026/27 and continuing
into future years as set out on the next page:
 
 

Committee

Savings Proposal

£

% Budget

Adult Social Care & Public Health &
Housing*

878,000

1.1%

Children's Services, Education &
Skills*

940,000

2.4%

Economy, Regeneration, Transport &
Infrastructure**

252,000

0.9%

Environment & Community Protection

566,000

3.3%

Policy, Finance & Resources

223,000

1.0%

Cross Council - Staff Reduction Programme

641,000

0.3%

Grand Total

3,500,000

1.9%

* Excludes the additional funding passported
through to Adult Social Care of £14.8m (which if included
would result in an overall increase of 18.1%) and the additional
funding for Children's Services
,Education and Skills of £3.9m (which if included would
result in an overall increase of 7.5%)

** Excludes £19.4m of PFI grant funding,
on a gross expenditure basis the saving amounts to 0.5%

 
 
(h) 
(amended recommendation) Directors be instructed to start planning
how the Council will identify savings opportunities to contribute
towards a Transformation Plan to address the forecast "Structural"
Deficit of £40m for 2027/28 and rising to £66m by 2029/30
and that this be incorporated into Service Business Plans
 
(i)   
The immediate establishment of an appropriately constituted
Improvement Board to support the development and implementation of
a Transformation Plan
 
(j)   
The minimum level of Revenue Balances as at 31 March 2027, be maintained at £12.0m to
reflect the known and expected budget and financial risks to the
Council
 
(k)  
Members have regard for the "Statement of the Section 151 Officer
in accordance with the Local Government Act 2003"
 
(l)   
(amended recommendation)The Capital
Programme 2025/26 to 2030/31 set out in Appendix 5 (Amended) which
includes all additions (set out in Appendix 4), deletions (set out
in Appendix 4a) and amendments for slippage and re-phasing to be
amended to reflect the following changes:

 

 

 

 

 

Scheme Description -
Reductions & Additions

 

Increase /
(Decrease)
 in Corporate Resources

Total Corporate
Resources Allocated

 

£

£

Reductions /
Deletions to Proposed Capital Schemes:

 

 

 

62

Delete - Parking Machines & Tariff
Boards

 

(197,275)

0

105

Delete -Chamber Microphone System

 

(60,000)

0

 

 

 

 

 

Total Overall
Change

 

(257,275)

 

 
(m)The allocation of Disabled
Facilities Grants be made to the Better Care Fund, and reflected
within the recommended Capital Programme 2025/26 to 2030/31
 
(n) 
The S.151 Officer be given delegated authority to determine how
each source of finance is used to fund the overall Capital
Programme and to alter the overall mix of financing, as necessary,
to maximise the flexibility of capital resources used and minimise
the ongoing costs of borrowing to the Council
 
(o) 
That the S.151 Officer in consultation with the Leader of the
Council be given delegated authority to release capital resources
held back for any contingent items that might arise, and for any
match funding requirements that may be required of the Council to
secure additional external capital funding (e.g. bids for funding
from Government or any other external source).
 
(p) 
The Capital Strategy 2026/27 including the Minimum Revenue
Provision Policy Statement contained therein (Appendix 6)
 
(q) 
The Investment Strategy (Non-Treasury Investments) 2026/27
(Appendix 7)
 
(r)   
(additional recommendation) That delegated authority be given to
the S.151 Officer to make any necessary changes to either the
investment Strategy or the Capital Strategy in accordance with the
proposed changes to the capital programme set out in this
amendment
 
(s)  
(additional recommendation)
With regard to the savings proposal 47 Staff
Reduction Programme; the Council is committed to transforming
services to deliver improvements in services to residents and
delivering productivity gains through harnessing the benefits of
technology and modern ways of working.  Transformation will
involve re-organising Services and staff roles and
responsibilities.  It is proposed that the Council uses every
opportunity to redeploy the Council's talent to deliver the
necessary transformation or where that is not possible,
enter into voluntary arrangements. There
will be no compulsory redundancies.
 
(t)   
(additional recommendation)
 
The removal of
"Fort Victoria Closure winter closure (Oct-Mar)" from saving number
23 set out in Appendix 3
 
(u) 
(additional recommendation)
In recognition
that the proposals within this Amendment lead to an overall
increase in the Council's forecast Structural Deficit by £1.2m
over the whole 3 Year period from £65.1m to £66.3m, and
that long term sustainability for the Isle of Wight Council
services will require transformational approaches which will
require substantial investment; the following suggestions are
prioritised for consideration by a Transformation Board (acting as
an Improvement Board) with a view to eliminating this Structural
Deficit:`
 
i)                
Review the price structure of Tourist Parking
Permits as a mechanism to maximise the volume of sales income that
can be achieved - balancing both the economic impact of any such
change against the financial benefit to the Council
 
ii)              
Review night time Long
Stay parking charges taking into consideration the revenues raised
versus the cost of enforcement and balancing the economic impact to
the night time economy of any such change against the financial
benefits to the Council  
 
iii)             
Continuing the following initiatives already earmarked against the
reserve:
 
·      
Support for the continuation of the implementation of the
Children’s Social Care Multi Agency Safeguarding Hub
£0.2m
·      
Accommodation for care leavers £0.5m
·      
Contribution to the Regional Care Co-operative £0.25m
·      
Children’s Services project staff £0.3m
·      
ICT Licences – Copilot £0.1m
·      
Purchase of a property for temporary accommodation £0.3m
 
iv)            
Reduction of poverty and increase in community resilience, and
improving mental health and wellbeing, leading to reduced need for
support and intervention from statutory services with joint working
alongside public health wherever possible.
 
v)              
Partnerships with voluntary sector and other not-for-profit
organisations (e.g. IW Community Action).
 
 
vi)            
Collaborations with health and social care partners towards
reducing delayed discharge and providing improved care at home.
 
vii)           
Working with town, parish and community councils on stewardship of
public assets and programmes where joint approaches produce greater
benefits alongside other not-for profit organisations where
possible.
 
viii)         
Using technology to reduce staff workload pressure, support staff
welfare and increase organisational efficiency.
 
ix)            
Investment in economic development, particularly for small
business, that increase the number, quality and security of
employment opportunities
 
x)              
Maximising benefits of the Island’s environment and
particularly, its Biosphere status.
 
Success of the transformation programme will
be enhanced through the input of external assurance and expertise.
A Transformation Board (acting as an improvement board) be
established with the costs of the board to be monitored carefully
to provide assurance that value for money is achieved.
 
That reports to Service Committees and Audit
and Governance Committee are presented at each meeting to advise
upon and monitor the delivery of indicative savings and the
implementation of any transformation project; this to provide
further assurance, ensure accountability and demonstrate democratic
oversight.
 
It is recommended that the Council note the
following in respect of the Council's Budget: 
 
(a) 
The Revenue Budget 2026/27 as set out in Appendix 1 has been
prepared on the basis of a 4.99%
increase in Council Tax, any reduction from the overall 4.99%
Council Tax increase proposed will require additional savings of
£1,163,500 for each 1% reduction in order for the Budget
2026/27 to be approved
 
(b) 
The Revenue Forecasts for 2027/28 onwards as set out in the section
entitled "Revenue Forecasts 2027/28 to 2029/30" and Appendix 1
 
(c)  
(amended)The forecast "Structural" Deficits amounting to
£65.1m in total by 2029/30 as follows:

BUDGET 2026/27 to 2029/30

2026/27

2027/28

2028/29

2029/30

 

 

£m

£m

£m

£m

 

 

 

 

 

 

Structural Deficit

20.4

39.7

56.4

66.3

Note: As savings are
made, debt costs will reduce (estimated at £18m by 2029/30)
and therefore the overall sums that need to be saved will be
reduced
 
(d) 
The Transformation Reserve held to fund the upfront costs
associated with Spend to Save Schemes and Invest to Save Schemes
has been set at £12m for 2026/27 with modest replenishments
planned at £1m p.a over the period
to 2029/30 plus any approval to the transfer of any further savings
at year end
(e) 
Should the Council elect to reduce the level of savings below
£6.3m in 2026/27, the Council's requirement for Exceptional
Financial Support will increase which in turn will increase the
Council's "Structural" Deficits for future years beyond the
estimated £65.1m and putting Council Services at further
risk.
(f)   
The Council Tax base for the financial year 2026/27 will be
58,067.2 [item T in the formula in Section 31 B(1) of the Local Government Finance Act 1992, as
amended (the “Act”)].
(g) 
The Council Tax element of the Collection Fund for 2025/26 is
estimated to be in surplus by £632,402 which is shared between
the Isle of Wight Council (85.4%) and the Police & Crime
Commissioner (11.1%) and the Hampshire & Isle of Wight Fire
& Rescue Authority (3.5%)
(h) 
The Business Rate element of the Collection Fund for 2025/26 is
estimated to be in surplus by £639,172 of which is shared
between the Isle of Wight Council (49%), the Hampshire & Isle
of Wight Fire & Rescue Authority (1%) and the Government
(50%)
(i)   
The Retained Business Rate income[2]for 2026/27
based on the estimated Business Rate element of the Collection Fund
surplus as at March 2026, the Non
Domestic Rates poundage for 2026/27 and estimated rateable values
for 2026/27 has been set at £33,320,232.
(j)   
That the Dedicated Schools Grant deficit[3]
is forecast to be £27.1m by March 2026 and the overall
liability that is estimated to fall to the Council once the
statutory override comes to an end in March 2028 is £4.6m
 
(k)  
The Equality Impact Assessment (attached at
 

[1] Council
Tax increases beyond the referendum threshold can only be
implemented following a "Yes" vote in a local
referendum.

[2]Includes Retained Business Rates of
£28,457,639, "Top Up" of £3,722,135, S.31 Grants of
£827,263 and a Collection Fund surplus of
£313,195
 

[3]  Excluding
Safety Valve Payments of £9.6m