Purpose

This report provides the Council’s provisional outturn (prior to final accounting adjustments and external audit review) financial performance for 2025-26.

The financial performance for General Fund revenue was an underspend of £27.3m against the 2025-26 budget, achieving the target required by the Stabilisation Plan.  There is no overall change since Period 10.

The General Fund capital programme showed a provisional underspend of £38.6m.

The financial performance for the Housing Revenue Account (HRA) was an underspend of £1.6m.  This demonstrates a £1.6m improvement since the break-even forecast at Period 10.  The HRA capital programme showed a provisional underspend of £13.5m.

The financial performance for the Dedicated Schools Grant (DSG) was an overspend of £32.7m.  This demonstrates a £2.0m improvement since the £34.7m forecast overspend at Period 10.

Decision

For the reasons set out in the report, the Executive Mayor and Cabinet are recommended AGREED:

1. 2.1Note the General Fund revenue budget provisional underspend of £27.3m, achieving the target required by the Stabilisation Plan.  This would reduce the necessary level of capitalisation directions from £136.0m to £7m.
2. 2.2Note that the provisional outturn is the position prior to final accounting adjustments (e.g. capital accounting and revaluations) and any changes required from the external audit.
3. 2.3Note that the significant level of 2026-27 savings (£098m), agreed by Full Council in February 2026, include reduction in budgets that are delivering underspends in 2025-26 and will, therefore, not be recurrent underspends in 2026-27.
4. 2.4Note the unfunded local government cost pressures that exist nationally, regionally and locally relating to increases in demand and market prices which need to be addressed by Government changes to policy and/or funding levels.
5. 2.5Note the Medium Term Financial Strategy (MTFS) savings achievement of £21.6m (86.1%) against the total savings target of £25.1m as set out from paragraph 5.100.
6. 2.6Note the Housing Revenue Account (HRA) revenue outturn was a £1.6m underspend.
7. 2.7Note the Dedicated Schools Grant (DSG) provisional overspend of £32.7m.
8. 2.8Note the General Fund capital programme 2025-26 provisional underspend of £38.6m (18.0%) against the revised budget of £214.6m.  The capital budget includes expected capitalisation directions of £108.7m (£136.0m less the Stabilisation Plan target underspend of £27.3m).
9. 2.9Note the HRA capital programme 2025-26 provisional underspend of £13.5m (12.4%) against the revised capital budget of £108.5m.
10. 2.10      Note the Council’s historic borrowing and subsequent debt burden and national, regional and local service pressures continue to be critical to the non-sustainability of the Council’s revenue budget as set out from paragraph 5.125.