The Worcestershire County Council meeting scheduled for Thursday, 26 February 2026, was set to address the council's financial future, including the proposed budget for the upcoming year and the medium-term financial plan. Key discussions were also scheduled around the robustness of budget estimates, the adequacy of financial reserves, and the council's capital programme.

Updated Report of the Chief Financial Officer on the Robustness of the 2026/27 Budget Estimates and the Adequacy of Reserves

This report, prepared by the Chief Financial Officer (S151 Officer) Phil Rook, was intended to advise council members on the robustness of the estimates made for the 2026/27 budget calculations and the adequacy of proposed financial reserves. This is a statutory requirement under Section 25 of the Local Government Act 2003. The report aimed to provide context for decisions regarding the annual budget, the Medium-Term Financial Plan (MTFP), and the setting of the Council Tax.

The report highlighted significant national and local financial risks, including increasing costs and demand for services, particularly in Children's and Adult Social Care. It noted the council's reliance on Exceptional Financial Support (EFS) and the potential implications of issuing a Section 114 Notice, often referred to as a bankruptcy notice, if immediate action was not taken. The report also detailed the council's financial management and governance arrangements, including various control boards and panels in operation to challenge expenditure.

The external auditor's conclusions from the Auditor's Annual Report 2024/25 were included, indicating significant weaknesses in the council's arrangements for financial sustainability. Key recommendations from the auditor included the need to address budget pressures, reduce reliance on EFS and limited reserves, and implement savings and transformation programmes at pace.

The report also addressed the Dedicated Schools Grant (DSG) deficit, specifically concerning High Needs budgets, which represented the council's most significant financial risk. The ability to present a balanced budget was noted as being dependent on a Statutory Override, a temporary measure that excludes SEND deficits from the council's balance sheet but does not resolve the underlying funding gap.

The Chief Financial Officer's opinion was that, subject to the approval of the Exceptional Funding Support Capitalisation Direction and maximising council tax flexibility, the proposed 2026/27 budget was robust and the level of reserves and balances was adequate.

2026/27 Proposed Budget and Medium-Term Financial Plan 2027-2029

This report presented the council's proposed budget for 2026/27 and the Medium-Term Financial Plan (MTFP) for 2027-2029. It detailed the council's current financial position for 2025/26, following the receipt of the Final Local Government Finance Settlement.

The report highlighted the continued demand and cost pressures in Children's and Adult Social Care, a situation experienced by most county councils. Despite efforts to manage these pressures, a significant overspend was forecast, partially mitigated by investment income and reduced borrowing requirements. The report noted the council's reliance on one-off sources of funding, such as reserves and Exceptional Financial Support (EFS), which was deemed not to be a financially sustainable position.

The report detailed the projected budget gap of £74.3 million for 2026/27, even after accounting for approved savings and indicative increases in grants and other funding. It outlined the council's request to the government for Exceptional Financial Support (EFS) in the form of a capitalisation directive and permission to increase Council Tax above the referendum limit. A capitalisation direction was described as a mechanism to provide time for the council to develop sustainable solutions, rather than a permanent fix.

Significant investment and demand pressures were detailed across various services, including Adults Social Care (£25.2 million), Children's Services (£25 million), and Home to School Transport (£8.3 million). The report also addressed changes in grant funding, with a significant number of grants being rolled into the Revenue Support Grant (RSG) and Core Spending Power (CSP).

The report included a summary of proposed savings, efficiencies, and income generation totalling £8.975 million for 2026/27. It also detailed the projected movement in reserves, showing a significant reduction over the coming years, and highlighted concerns about the adequacy of risk reserves.

The Dedicated Schools Grant (DSG) deficit, particularly the High Needs budget, was identified as a key threat to the council's financial sustainability, with a forecast accumulated deficit of £194.1 million by the end of 2026/27. The report noted the government's intention to transfer responsibility for SEND funding from local government to central government from 2028, but highlighted uncertainties regarding accrued deficits.

The report also presented options for Council Tax increases, noting that a 4.99% increase was the draft assumption, generating an additional £20.7 million. However, it also outlined the potential for a 9.99% increase (5% above the referendum limit), which would generate an additional £38.7 million, subject to government approval.

The Capital Programme for 2025/26 to 2028/29 was detailed, totalling £644.816 million, with £203 million planned to be funded by borrowing. The report highlighted significant funding from external sources, including developer contributions and government grants, with borrowing making up 27% of the funding.

Finally, the report included the outcome of the Budget Consultation undertaken in October 2025, which indicated support for a 5% or higher Council Tax increase, with particular concern from respondents about potential spending reductions in Children's Social Care, Adult Social Care, and Schools.

Reports of Cabinet

This agenda item was for the Council to consider the report of Cabinet, summarising the decisions taken at its recent meetings. It also included the opportunity for councillors to receive answers to any questions they had asked regarding these decisions.

Political Balance

This item was scheduled to consider an update to the Council's political balance. This recalculation was necessitated by Councillor David Taylor leaving the Reform UK Group, requiring an adjustment to the allocation of seats on committees to maintain political balance in accordance with the Local Government and Housing Act 1989. The report proposed increasing the membership of the Appointments Etc Panel from 6 to 7 to accommodate all groups and the non-aligned independent member.

Notices of Motion

Two Notices of Motion were scheduled for consideration:

1. Support of Adopted Children and the Adoption & Special Guardianship Support Fund: This motion, proposed by Cllrs Dan Boatright-Greene, Sam Ammar, and Sam Evans, expressed concern over cuts to the Adoption & Special Guardianship Support Fund (ASGSF) and called on the Secretary of State for Education and the Minister for Children, Families and Wellbeing to commit to reviewing the merits of making the ASGSF permanent and to reverse the cuts. It also proposed inviting a representative from Kinship Carers UK to speak to members.

2. Urgent concerns regarding delays to the SEND white paper: Proposed by Cllrs Nik Price, Justin Bowen, Michele Hulme, and Mark Dunkley, this motion noted the delay in the government's White Paper on Special Educational Needs and Disabilities (SEND). It expressed deep disappointment at the further delays, highlighting the critical situation, the escalating costs, and the threat to the financial stability of local authorities. The motion called on the Cabinet Member with Responsibility for Education and SEND to write to the Secretary of State for Education requesting urgent action due to escalating SEND costs and the issue of overspends held as negative reserves.

Question Time

This item allowed councillors to ask questions of the Cabinet Members. The questions submitted related to:

• The RSA Stage 4 report for the A4440.
• The Worcestershire on Demand bus service, specifically regarding access to Worcester Royal Hospital.
• High School provision in Bromsgrove.
• Highway issues at the bridge on Alcester/Stratford Road.
• The impact of the government's fair funding review for local government finance on spending decisions.
• The number of vacancies on committees and scrutiny panels and the reasons for Reform councillors' low attendance.
• The timescale for the installation of a new footpath on Dilmore Lane, Fernhill Heath.
• The impact of BREP on traffic flow between Lydiate Ash and Puddlewharf roundabout.
• An update on the proposed Severn Stoke Bund.
• The time taken to unblock drains.
• The time taken to replace a damaged lamp post.

Reports of Committees

This item was for the Council to consider the report of the Standards and Ethics Committee, summarising decisions taken, and to receive answers to any questions asked on the report. The report detailed agreed changes to the arrangements for dealing with complaints against Members under the Code of Conduct, including timescales for acknowledgement and conclusion of the filtering stage, and criteria for formal investigation.

The meeting was scheduled to be held at Wychavon District Council's Civic Centre in Pershore. The information provided indicates that the meeting was pending council publication, meaning that while the agenda was made public, the final minutes and outcomes of the meeting were not yet available.