Decision Maker: Cabinet

Outcome: Recommendations Approved (subject to call-in)

Is Key Decision?: Yes

Is Callable In?: Yes

Date of Decision: December 3, 2025

Purpose: This report provides the Council’s financial performance as at Period 6 (September 2025) for the General Fund, Housing Revenue Account (HRA) and the Capital Programme.  It also requests the Executive Mayor and Cabinet to approve an inter-directorate budget virement from Resources to Housing General Fund to align with where the cost of temporary accommodation management fees (non-claimable from Housing Benefits) now impacts.  This follows these costs now being recorded in the NEC housing system (no longer counted as part of the rent cost for housing benefits).

Content: For the reasons set out in the report, the Executive Mayor and Cabinet are AGREED:   2.1 to note the General Fund revenue budget outturn is forecast at Period 6 to underspend at financial year end by £23.8m, contributing to the target as required by the Stabilisation Plan. This would reduce the necessary level of capitalisation directions from £136m to £112.2m.   2.2 to approve the inter-directorate virement from Resources to Housing (General Fund) of £3.022m budget to align with where the cost of temporary accommodation management fees (non-claimable from Housing Benefit subsidy) now impacts. This aligns with these costs now being recorded in the NEC housing IT system (no longer counted as part of the rent cost for housing benefit subsidy), as set out from paragraph 5.82. This is not a change to the purpose of the budget agreed by Full Council.   2.3 to note that service directorates have been asked to reduce their net expenditure below their budgets so that the annual budget can be balanced with reduced use of capitalisation directions, including achievement of the £27.3m Stabilisation Plan target as set out from paragraph 5.19. It should not be underestimated what a challenge this will be against the background of increased demand pressures which are continuing to build across local government as well as increased market prices.   2.4 to note 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.   2.5 to note that the presentation of full Financial Performance Reports to Cabinet is being moved to a quarterly basis, with a shortened Financial Performance Summary being published for other months from Period 2 to Period 10 on the Council’s Corporate Performance and Finance Reporting webpage. This change is to ensure regular reporting for transparency whilst also prioritising service and finance officer time on value-added activities including transformation, as set out from paragraph 5.10.   2.6 to note the progress in Medium Term Financial Strategy (MTFS) savings achievement of £21.7m (86.2%) against the total savings target of £25.1m as set out from paragraph 5.125.   2.7 to note the Housing Revenue Account (HRA) revenue budget forecast outturn is a breakeven position.   2.8 to note the General Fund capital programme 2025-26 forecast underspend of £44.8m (16.2%) against the revised budget of £275.9m. The expected decrease in capitalisation direction usage owing to the Stabilisation Plan accounts for £27.3m of the forecast underspend. £24.4m of this is evidenced to date at Period 6 with directorates continuing to reduce their net expenditure wherever possible.   2.9 to note the HRA capital programme 2025-26 forecast underspend of £26.8m (22.2%) against the capital budget of £120.5m.   2.10 to 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 5.146.   2.11 to note that the Council continues to operate Spend Control Panels, and tightened the criteria from July 2024, to ensure that stringent financial control and assurance oversight are maintained.   2.12 to note that current forecasts are based on the best available information at the time and will be subject to review and change during the financial year.