Budget proposals for 2026/27 and Medium Term Financial Plan 2026/27-2029/30 (Phase two consultation)

We continue to work towards finalising our budget proposals for the year ahead and across the next four years as part of our Medium Term Financial Planning process. We will not know what levels of funding we will receive from the Government next year until late December and are continuing to face significant financial pressures.

We have consistently made a strong case for more fairness in how local government funding is distributed and the urgent need for the Council to receive a much bigger financial settlement from central government. Our financial position has been impacted by escalating demand and cost pressures in its statutory social care budgets and responsibilities, which we have had no choice but to address in our budget assumptions. For many years now, we have been asked by successive governments, to do increasingly more, at greater cost, with less and less resources. 

We must therefore consult you on additional savings, developed to help with balancing the budget next year and across the next four years through to 2029/30. These further savings are in addition to the savings set out in the consultation on our budget proposals which took place between 19 September and 14 November 2025. 

Update on financial position

The financial forecasts set out in the 17 September 2025 Cabinet report demonstrate that balancing our budget will be extremely challenging over the next four years, especially if no Council Tax increases are applied across the Medium Term Financial Planning (MTFP) period.

The September Cabinet report assumed that the £5.662 million of savings proposals agreed in February 2025, which impact on the current MTFP planning period, are continued and delivered. These savings proposals were subsequently subject to the consultation which we held earlier this year, which closed on 14 November 2025.

You can read the full report in the Cabinet agenda and minutes 19 November

Updated savings proposals - November 2025 savings plan

To assist with addressing the budget challenge we face, we now propose £10.057 million of new savings proposals that have been developed, with £9.103 million (90%) in 2026/27, £0.586 million (6%) in 2027/28 and £0.368 million (4%) in 2028/29. 

These savings proposals have been developed as part of our financial planning arrangements in recent weeks. Most of these savings will be implemented in 2026/27.  

These savings seek to once again limit the impact on front line service delivery and can be categorised as follows:

1. Savings from back office and making operational efficiencies
2. Raising additional income and considering our third-party contributions
3. Savings from changes in the way we deliver front line services

Impact on our budget

Once the £10.057 million of new additional savings proposals across the four year MTFP (16) planning period are factored in, the revised budget shortfall, based on 0% Council Tax increases across this period, is summarised below. A comparison is provided drawn the position reported to Cabinet on 17 September 2025:

If these savings are agreed our budget shortfall would be £18.464 million for 2026/27, and we would have a cumulative budget shortfall in the first two years of MTFP (16) of £36.241 million (covering the period 2026/27 and 2027/28).

The table above shows that despite the implementation of proposed savings of £10.057 million, we are facing a more challenging financial position than it assumed in September. This is primarily due to rising cost pressures in relation to Children’s Social Care and costs of Home to School Transport.  

By the end of the Medium Term financial planning period, we will have had to find savings and efficiencies of more than £300 million since 2010.

Outcomes and next steps

Despite the development of £10.057 million of new savings proposals, if agreed, a significant budget deficit remains. Our Cabinet will therefore need to carefully consider options to raise Council Tax, find further financial savings and consider the use of reserves as a temporary measure to help balance the budget next year.

Your feedback from this further phase of consultation and the previous phase of consultation will help us shape and finalise our budget proposals for 2026/27, as well as help us look ahead longer term to make future savings. This will be reported to our Cabinet and Full Council in January and February 2026.