The Leadership Team meeting addressed the development of a new open space at Lots Road, reviewed the council's financial performance for the first quarter of the 2025/26 financial year, and discussed the significant challenges posed by proposed government funding reforms. Key decisions included approving the procurement strategy for the Lots Road open space and noting the council's financial position, which showed a nil variance overall for the quarter despite pressures in specific departments.

Lots Road - Construction of a New Open Space

The council approved the procurement strategy for the construction of a new meanwhile open space at Lots Road. This temporary space, designed to be demountable due to Thames Tideway's access requirements, will offer sports and play facilities, seating areas, greening, and habitat creation. The project is a commitment in the Council Plan 2023-2027 and has been co-designed with residents. The estimated contract value is £1,250,000 (excluding VAT), with a contract duration of four months. The project aims to commence on-site by February 2026 and open by early summer. Ongoing maintenance costs are estimated at £100,000 per annum. Councillors discussed the funding source, which is a Section 106 contribution, and the potential for social value to be translated into monetary benefits for local estates.

Quarter 1 Financial Monitoring Report 2025/26

The council reported a forecast nil variance against its General Fund revenue budget of £217.667 million at the end of the first quarter. This overall balanced position was achieved despite pressures in some departments, including Housing and Social Investment (£784k overspend due to temporary accommodation costs) and Children's Services (£508k overspend primarily due to high-cost placements). These pressures were offset by significant underspends in Environment and Neighbourhoods (£4.132m), largely due to higher-than-anticipated income from parking services (£3.827m overachievement). Favourable treasury interest income also contributed to the balanced position. The Housing Revenue Account (HRA) reported a forecast underspend of £75k, with a transfer of £2.475m to the capital programme. The General Fund Capital Programme showed a net underspend of £9.216m, and the HRA Capital Programme had a net underspend of £43.030m, with significant slippage in several large projects. The report also detailed the council's savings targets, with 87% identified as achievable at this stage, and outlined the position of the council's reserves.

Update on 2026/27 Budget Setting and Medium Term Financial Planning

The council is facing a significant budget gap over the next four years due to proposed government funding reforms, known as Fair Funding 2.0. The estimated impact of these reforms is an adverse effect of £83 million over the period 2026/27 to 2029/30. The council's response to the government's consultation, submitted in August, argues for a longer transitional period and highlights concerns about the proposed formula's impact on London boroughs, particularly regarding housing costs and deprivation measures. The current estimated budget gap for 2026/27 is £8.9 million, before internal budget challenge sessions. This gap is projected to grow to £83.5 million over the four-year period. The council is proposing savings, including a second homes tax and reductions to the Council Tax Support Scheme, alongside potential service reductions, to address this shortfall. The government's Local Government Finance Policy Statement is expected at the end of September, which may provide further clarity on the funding reforms. The council is also facing pressures from inflation, pay awards, and increased demand for services, particularly in adult social care and children's services.