The Public Accounts Select Committee met on Tuesday 7 July 2026 to review the council's financial performance and future strategy. Key discussions included the draft outturn for the 2025/26 financial year, the forecast position for 2026/27, the medium-term financial strategy, and the committee's work programme.

Financial Monitoring 2025/26 - Outturn

The committee noted the draft financial outturn for the year ending 31 March 2026, which showed a £4.4 million underspend on the General Fund. This was an improvement of £4.8 million since the period 10 forecast, largely due to strong financial management, early delivery of savings, and positive performance in housing services. However, the council had planned for a larger underspend of £6.7 million to reduce reliance on reserves, meaning the actual underspend was £2.3 million less than planned.

Significant pressures remain in Children and Young People's Services, which reported an overspend of £5.9 million, primarily due to rising accommodation and support costs for vulnerable children. Adult Social Care and Health also reported an overspend of £3.2 million, attributed to increasing complexity of need and high care package costs. The Dedicated Schools Grant (DSG) reported an in-year deficit of £5.5 million, increasing the cumulative deficit to £24 million.

Capital expenditure for 2025/26 totalled £139.4 million against a budget of £178.1 million, representing 78% delivery. Slippage was mainly linked to regeneration and housing schemes due to procurement and delivery delays.

Collection performance for Council Tax was 92% against a target of 96%, and Business Rates collection was 96% against a target of 99%. These shortfalls will be managed through collection fund reserves but will create future pressures if collection rates do not improve.

Financial Monitoring 2026/27 - Period 2 Monitoring

The committee reviewed the forecast financial position for the year ending 31 March 2027, as at the end of May 2026. The General Fund is forecasting a full-year overspend of £3.1 million, equivalent to 0.73% of the net budget. This forecast is driven by increasing demand and cost pressures within Children's and Young People's Services and Adult Social Care and Health.

Despite these pressures, the delivery of budget savings is progressing, with £28.1 million of the £30.1 million planned savings for 2026/27 anticipated to be delivered. However, there are risks associated with the delivery of some savings, particularly in Children's Social Care and Adult Social Care.

The Dedicated Schools Grant (DSG) is forecasting an overspend of £4.5 million on the high needs block, and the Housing Revenue Account is forecasting a balanced position. Council Tax collection is currently below target at 94%, and Business Rates collection is at 88%.

Medium Term Financial Strategy

The committee discussed the council's medium-term financial strategy for the next four years. The strategy highlights a projected budget gap of £64.469 million over the period 2027/28 to 2030/31. This gap is influenced by uncertainties in government funding following the Spending Review period and ongoing economic volatility.

The council plans to address this gap through a combination of savings targets and potential increases in Council Tax. The strategy assumes a 4.99% increase in Council Tax annually, comprising a 2.99% core increase and a 2.00% Adult Social Care Precept.

Key risks identified include the potential for higher inflation than forecast, the discontinuation of government grants after the Spending Review period, and the impact of increased borrowing for the capital programme. The strategy also acknowledges the significant pressures on demand-led services such as Adult and Children's Social Care.

The committee agreed to note the risks associated with budget reduction measures and the uncertainty of government funding. They also agreed to the reversal of a £200,000 saving related to the Youth Service budget for 2026/27, which will be initially funded from Corporate Provisions budgets.

Select Committee Draft Work Programme

The committee reviewed its draft work programme for 2026-27. Proposed topics included a review of social value in commissioning, the municipal investment vehicle, savings and cuts options, and a potential green bond.

There was a discussion regarding the feasibility and scope of scrutinising certain topics, particularly those related to external market conditions such as temporary accommodation and foster care. Councillor James Rathbone advised focusing on areas where the committee could influence council policy and decision-making, rather than external market factors. Councillor Gavin Moore proposed a three-step approach: speaking with the Deputy Mayor to confirm the readiness of proposed reports, commissioning an information paper on a key area of concern, and empowering the Chair and Vice-Chair to refine the action plan.

Ultimately, the committee agreed to note the draft work programme as currently drafted for 2026-2027.