The Finance and Improvement Overview and Scrutiny Committee of Shropshire Council met on Monday 8 June 2026 to review the council's financial outturn for the 2025/26 financial year, performance against the Shropshire Plan for Quarter 4 of 2025/26, and progress on the Improvement Plan. The committee also discussed the lessons learned from the organisational transformation programme with PwC and considered the future work programme.

Financial Outturn 2025/26

The committee reviewed the financial outturn for the 2025/26 financial year, which revealed a significant adverse variation of approximately £50 million against the approved budget. This shortfall was primarily attributed to ongoing pressures in adult and children's social care, driven by increased demand, complexity, and rising placement costs. Members also noted the impact of unachievable savings targets and reduced staffing capacity from previous redundancy programmes. While some stabilisation was observed towards the end of the financial year, and the reliance on Exceptional Financial Support (EFS) was lower than initially projected, concerns were raised about the structural budget deficit. The committee welcomed the implementation of improvements in financial monitoring and governance, but requested further scrutiny of social care pressures and transformation programmes, along with pre-meeting briefings for complex financial reports. The committee noted the report and forwarded its comments to Cabinet, emphasising the need for realistic budget setting, strengthened governance, and continued focus on high-cost service areas.

Q4 Performance Report

The committee received the Quarter 4 performance report for the 2025/26 financial year, alongside a proposed new performance framework aligned to the Council's Corporate Plan 2026-2030. It was noted that 77% of key performance indicators (KPIs) were meeting or exceeding their targets, showing a slight improvement from the previous quarter. Members welcomed the enhancements to performance monitoring processes and the new framework, which includes KPIs and delivery commitments. However, concerns were raised that the headline figures might present an overly positive picture, not fully reflecting the Council's financial challenges or the difficulties in key service areas. Specific issues highlighted included the lack of integrated financial and performance reporting, the focus on statutory and high-risk indicators, and the need for clearer presentation of underlying data, such as volumes and backlogs. Members also noted inconsistencies in KPI presentation and requested greater standardisation. Areas of concern included pressures in adult and children's services, school readiness outcomes, and resident-focused services like highways and waste management. The committee stressed the importance of differentiating between critical and non-critical indicators and ensuring KPIs meaningfully reflect resident outcomes. Officers committed to addressing these concerns through the development of the new performance framework and further engagement with members. The committee noted the report, endorsed the recommendations, and agreed that the issues raised would inform the development of the new framework and future performance reporting.

Improvement Plan - Progress Report

The committee reviewed the progress of the Council's Improvement Plan, which serves as the overarching framework for stabilisation, recovery, and long-term transformation following the declaration of a financial emergency in 2025. Members acknowledged that progress was broadly in line with the plan, with initial milestones achieved, including securing Exceptional Financial Support (EFS), establishing a more realistic budget for 2026/27, and strengthening financial management and governance. The development of foundational elements for long-term improvement, such as the corporate plan, transformation savings portfolio, and supporting strategies, was also noted. However, the committee emphasised that while organisational structure and governance had seen improvements, the plan lacked detailed, quantified steps towards achieving financial sustainability. Concerns were raised about the clarity of savings delivery, the reduction of reliance on EFS, and the identification and timing of necessary service decisions to address the structural deficit. Officers explained that the Improvement Plan provides the strategic direction, with detailed financial planning and delivery to be outlined in the forthcoming Medium Term Financial Plan, which will include further development of the financial sustainability strategy and transformation programme. Members also requested clearer reporting, including better explanations of performance ratings and reduced ambiguity in standard wording. The committee recognised the complexity of the Council's financial situation and the progress made, while stressing the need for clearer, more detailed delivery plans and continued scrutiny as the next phase of improvement and financial planning progresses.

Organisational Transformation: Lessons Learned Review

The committee considered an independent review of the Council's transformation programme with PwC. The review, conducted by Local Partnerships, focused on the governance, delivery, and oversight of the programme, rather than attributing blame. Members acknowledged the significant increase in the programme's scope and cost, expressing concerns about value for money, the clarity of delivered outcomes, and the extent of realised savings. Specific issues raised included insufficient business case development, a lack of comparative tender evaluation, and limited transparency and member scrutiny during the programme. The review highlighted weaknesses in governance, commercial assurance, and organisational ownership, such as concentrated decision-making, limited wider engagement, and insufficient challenge and oversight. Officers and Portfolio Holders outlined a revised approach to transformation, including strengthened governance, clearer accountability, enhanced procurement and contract management, and more robust requirements for business cases and benefits realisation. The committee welcomed the commitment to implement the review's recommendations and to provide regular reporting to Scrutiny and Cabinet, stressing the importance of ensuring future transformation activity is deliverable, transparently monitored, and clearly demonstrates outcomes and value for residents. The committee noted the report and endorsed the proposed actions to enhance governance, oversight, and accountability for future transformation initiatives.

Helena Lane Older Peoples Day Service and Aquamira Learning Disability Day Service

The committee received reports on the reviews of the Helena Lane Older Peoples Day Service and the Aquamira Learning Disability Day Service. For Helena Lane, members noted the financial sustainability challenges associated with the current building-based model, its low utilisation, and high cost, which did not represent value for money. Concerns were raised about the potential impact on service users, carers, and the community, particularly regarding respite provision and rural access. Officers confirmed that a comprehensive consultation had been conducted and that individual assessments and transition support would be provided. The committee recognised the complexity of the decision and supported its progression to Cabinet, with the expectation that impacts would be monitored. For Aquamira, the committee noted the financial sustainability issues of the current building-based model and the proposed relocation to Abbotswood. Concerns were raised about the impact on users, transport, and the hydrotherapy pool. Officers confirmed that specialist provision would be retained, with adaptations, and that individual assessments and transition planning would be undertaken. The committee acknowledged the balance between specialist provision and financial sustainability and supported the report's progression to Cabinet, with a recommendation for future reports to include clearer details on property implications.

Work Programme

The committee discussed its future work programme and potential areas for further development. Members supported the use of informal briefings for a more in-depth understanding of complex issues, particularly concerning major financial and organisational matters. Key topics identified for future briefings included the Medium Term Financial Plan, the Council's assets strategy, and the governance of improvement and transformation initiatives. The committee agreed to schedule an additional meeting in July to ensure timely consideration of forthcoming reports and to follow up on issues raised during the current meeting. Members also highlighted the importance of forward planning and allowing sufficient time for scrutiny of reports, especially those received late. The committee agreed that further work programming would be developed following a dedicated session on scrutiny planning, with proposed briefing topics and meeting arrangements to be confirmed and circulated.