The Policy Review and Performance Scrutiny Committee met on Wednesday 10 June 2026 to review the council's budget outturn for the 2025/26 financial year and to discuss the work programming for the upcoming year. The committee heard that the council had achieved a balanced budget for 2025/26, despite overspends in several directorates, which were offset by underspends in capital financing and other areas. Discussions also covered the council's capital programme, savings targets, and earmarked reserves. The committee also began planning its work programme for 2026/27, considering recommendations for a more strategic and inclusive approach to scrutiny.

Budget Outturn 2025/26

The committee reviewed the council's financial performance for the 2025/26 financial year, which concluded with a balanced budget. Councillor Leonora Thomson, Cabinet Member for Finance, Modernisation & Performance, presented the outturn report, highlighting that while the directorate position showed a net overspend of £2.090 million, this was offset by underspends in capital financing (£4.346 million) and the summary revenue account (£3.096 million).

Several directorates reported overspends, with Economic Development showing a £1.482 million deficit, largely due to income shortfalls from the closure of City Hall and unbudgeted premises holding costs. Children's Services also reported a £1.052 million overspend, primarily due to external placements and agency staffing costs, although this was an improvement on previous forecasts due to additional grant funding. Planning, Transport & Environment had an overspend of £987,000, attributed to underperformance in digital advertising income and operational pressures.

Conversely, underspends were noted in Adult Services (£1.036 million), attributed to a greater spend on commissioned services being offset by underspends in internal services and grant maximisation. Education & Lifelong Learning reported a £206,000 underspend, partly due to lower than anticipated spend on schools transport and reduced catering costs. Housing & Communities also showed an underspend of £500,000, aided by additional grant allocations and reduced repair costs.

The committee heard that the overall savings target for 2025/26 was £16.261 million, with a shortfall of £2.262 million against directorate savings targets. Efficiency and income savings targets saw a shortfall of £1.540 million, while service change proposals had a shortfall of £722,000.

Regarding earmarked reserves, the total in General Fund earmarked reserves (excluding schools) increased by £23.654 million to £156.840 million. The Housing Revenue Account (HRA) earmarked reserves also increased by £10.747 million to £20.830 million.

The capital programme saw a significant underspend of £98.291 million against the General Fund element, with major areas of slippage including schools' asset renewal, new schools (SOP), and the indoor arena. This underspend contributed to an increase in interest earned on invested cash balances. The HRA capital programme also experienced a variance of £39.535 million, primarily due to the timing of delivery of significant construction projects.

Members raised concerns about the underspend in Adult Services, given national pressures, and were informed that Cardiff still faced vacancies and building pressures, with contingency not being used this year but significant growth expected in 2027/28. The underspend was also partly due to late grant funding. The committee also discussed the capital programme, including a £9 million Welsh Government loan for town centre regeneration, and the potential link between capital underspends and accumulated interest. The use of Civil Parking Enforcement funds and the Housing Revenue Account for community improvements were also debated.

Committee Business

The committee noted the agreed dates for Policy Review & Performance Scrutiny Committee meetings up to March 2027. Members noted the draft pages for the Scrutiny Annual Report 2025/26. The committee also noted the correspondence between the committee and the Cabinet from December 2025 to April 2026, with the Chair adding that correspondence would become a standing agenda item and responses would be requested within six weeks.

Developing a Work Programme 2026/27

The committee discussed the process for developing its work programme for 2026/27, aiming to rebalance scrutiny towards earlier, strategic engagement rather than late-stage pre-decision review. Recommendations from an independent review by the Centre for Governance and Scrutiny (CfGS) were highlighted, emphasizing the need for a shared understanding of scrutiny's purpose, stronger strategic alignment with corporate priorities, and improved organisational culture and feedback mechanisms. The committee noted the way forward for setting its outline work programme for 2026/27, with a final version to be presented for approval in September 2026. Suggestions for future scrutiny included the consequences of the Supreme Court ruling on the Equality Act, the expansion of Kitei's school, communications with the public, and the implications of trusts on Cardiff's parks. The committee also expressed interest in understanding Cardiff's international policy. Councillor Garry Hunt proposed focusing on customer service levels and public perception, while Councillor Mike Ash-Edwards suggested examining the wider implications of trusts, particularly for parks, and improving how the council communicates its achievements. Councillor Graham Hinchey raised concerns about the depreciation of school infrastructure and deficit budgets, suggesting a focus on basic repairs. The committee agreed to consider these suggestions as part of the work programming process.