Purpose

To consider the financial planning framework for consideration of forthcoming budget proposals and plans, informed by updated forward spend and funding forecasts.

Decision

RESOLVED – That the report be referred to the Meeting of Council on 21 October 2026 with the recommendations that Council

(i)             note the key risks to the delivery of the budget in 2026/27 outlined in the Quarter 1 Financial Monitoring report and that these will be subject to consideration as part of the Budget Monitoring reports submitted to the Cabinet on a quarterly basis;

(ii)            note the uncertainty with the future funding outlook for the Council given the recent change in Government leadership, albeit within the context of a multi-year settlement earlier this year;

(iii)          note the update and the revised budget gap to the MTFS for the period 2027/28 to 2031/32 as shown at Appendix A and that in view of the uncertainty with some of the assumptions upon which the Strategy is based, that it will remain under review as the Council’s budget process progresses;

(iv)          note that there is a significant gap of c£24m in 2027/28 which requires either reduction in budget pressures or increased savings proposals to be brought forward at pace;

(v)           note the scenario analysis shown at Appendix C which models ‘worst’/’best’ case scenarios around the baseline MTFS as part of the assessment of potential risks facing the Council;

(vi)          note the current Capital Plan shown at Appendix D, reflecting updated General Fund funding assumptions prior to the completion of the Capital plan review and revised HRA funding assumptions based on the forecast additional rental income from rent convergence;

(vii)         agree the Medium Term Financial Strategy as set out in the report and that this provides a framework for the upcoming budget; and that this report will be presented at Council for noting and debate. There are no budget decisions associated with this report at this time;

(viii)       request Officers to identify and bring forward budget savings proposals as part of the provisional budget report which will be initially considered by Cabinet in December 2026 and then a final budget report will be presented for approval by Cabinet (and Council) as part of the development of the final budget for 2027/28 in February 2027;

(ix)          note that funding assumptions made in this report may be subject to change when the provisional local government finance settlement is published by Government (expected early December)

(x)           note the timetable set out in Appendix E of the report for the development of the Council’s Budget for 2027/28;

(xi)          note that it is proposed to undertake consultation on the budget proposals in late 2026 with a view to informing decisions on the Council’s budget for 2027/28.