The Economy Overview and Scrutiny Panel of Worcestershire Council met on Wednesday, 19 November 2025, to discuss the redevelopment of the Shrub Hill Quarter in Worcester and to review the council's performance and budget monitoring for the 2025/26 financial year. The panel also considered its work programme for the upcoming year.

Shrub Hill Quarter Redevelopment

The panel was scheduled to receive an update on the ongoing redevelopment of the Shrub Hill Quarter in Worcester. This project has been a focus for the council, with previous discussions and site visits informing the approach. A Supplementary Planning Document (SPD) for the Shrub Hill Quarter was adopted by Worcester City Council in September 2024, providing a planning framework for future development.

Significant progress has been made, including securing grants to support land remediation and demolition of existing buildings. A new shared-use link, designed to improve walking and cycling access, is nearing completion and is expected to open in January 2026. Funding from the Towns Fund is also supporting the development of an Enterprise Centre within the Isaac Maddox House building.

However, the procurement process for a development partner for Shrub Hill faced challenges, with an insufficient response to the initial tender. Feedback indicated concerns about the weighting of the SPD towards commercial uses and a desire for more assurance regarding flexibility in delivering the overall vision and influencing third-party land. The council has been reviewing these issues and preparing to bring the site back to market, taking into account changes in procurement legislation introduced by the Procurement Act 2023.

Performance and 2025/26 In-Year Budget Monitoring

The panel was set to receive a comprehensive update on the council's performance and financial position for the 2025/26 financial year, covering the second quarter (July to September 2025). This included a dashboard of performance indicators for services related to the economy, accessible via a Power BI report on the council's website. The panel's role in this agenda item is to identify any areas of concern or topics requiring further scrutiny.

Financially, the report detailed the in-year budget monitoring, including a summary of reserves. The overall corporate position indicated a breakeven forecast after the use of reserves, though the council faces a considerable financial challenge with costs increasing faster than income. Increased overspends were predicted in demand-led areas such as Adult Social Care and Children's Social Care, which were being mitigated by underspends in other services and corporate budgets.

A significant concern highlighted was the forecast overspend in High Needs funding, projected to reach £95.3 million for 2025/26, leading to a deficit of £193.7 million by March 2026. This issue has been flagged by external auditors. The report also provided an overview of the Capital Programme, valued at £495.8 million, with a significant portion funded by external sources.

Specific to the Economy and Infrastructure Directorate, the report indicated a net forecast underspend of £0.9 million, an improvement from the previous quarter. Key factors contributing to this included underspends in Waste Management due to higher tonnage rates and in Road Lighting due to the ongoing LED rollout. Passenger Transport also showed a forecast underspend due to increased income. Highways Operations, however, was forecast to overspend due to pressures in vacancy management and vehicle maintenance costs.

The Home to School Transport service was also discussed, with a net forecast underspend of £2 million. This was attributed to a review of expected new children, contracts, and routes, despite a 20% increase in children with Education, Health and Care Plans (EHCPs) over the past year.

Work Programme

The panel was scheduled to review its work programme for 2025/26. This programme is part of the council's rolling Annual Work Programme, which had been discussed by the Overview and Scrutiny Performance Board (OSPB) and agreed by the Council. The panel was asked to consider any amendments to the programme, while retaining flexibility to address urgent issues that may arise. Potential future items for scrutiny included the role of the council in encouraging commercial space development, the activity of the Growth Hub, and developments at Malvern Hills Science Park and Worcester Six Business Park. Standing items such as annual updates on digital infrastructure, the Worcestershire Local Enterprise Partnership (WLEP), and tourism were also noted.