The Budget Development Overview and Scrutiny Committee met to discuss the draft Council Financial Plans for 2026-2030 and the Budget for 2026/27. The committee considered updates on the budget and reserves position, the outcomes of public consultations, and the provisional Local Government Finance Settlement. Concerns were raised about significant reductions in government funding for Cornwall and an estimated £13 million funding gap in 2026/27. The committee also discussed the draft Reserves Strategy and the forecast increase in the Dedicated Schools Grant (DSG) deficit.

Draft Council Financial Plans and Budget 2026/27 Update

Officers presented information on the overall budget and reserves position, noting that the Council's spending power was projected to increase by 27% to £198 million by the end of the settlement period, but this was heavily reliant on council tax income. Excluding council tax, government funding was set to increase by only 4.5% over three years, representing a real-terms reduction. The Head of Financial Strategy and Technical provided an overview of the draft Reserves Strategy. The committee was informed that the Dedicated Schools Grant (DSG) deficit was forecast to increase to approximately £250 million by 2029, with confirmation awaited from the government on its future treatment.

The Deputy Leader and Portfolio Holder for Resources acknowledged the challenging period for officers in finalising budget figures due to high levels of uncertainty and change. The Head of Service for the Strategy Team presented findings from the public consultations on the draft Council Priorities and budget proposals. Over 900 responses were received for the Priorities Plan, with highest-ranked priorities focusing on safe and reliable roads and transport, education, skills, inclusion, child safety, and early intervention in adult social care. Key community challenges highlighted included the lack of affordable housing and pressure on services. The draft Budget consultation received 622 responses, with general support for most proposed measures, although proposals for public toilet closures and increases in fees and charges attracted more opposition.

During discussions on the consultations, members raised concerns about the low response rate and demographic representativeness, suggesting a Citizens' Assembly model for future engagement. Officers confirmed that a 4.99% council tax rise was effectively unavoidable under the government settlement assumptions. The committee discussed the need to review the language and approach to future consultations, simplify survey length, and provide a rolling programme of consultations on the Council's website.

The committee resolved to recommend to Cabinet:

• That Cabinet explores the delivery of a Citizens' Assembly approach for the next budget process.
• That other suggestions made throughout the meeting be considered.
• That Cabinet informally presents the Budget Development Overview and Scrutiny Committee with its final list of workable saving proposals well in advance of the Cabinet meeting on 11 February.

The meeting moved into a closed session to discuss confidential information regarding rejected savings proposals and the deliverability of draft budget proposals. Following the closed session, the committee discussed publicly available information, clarifying that the draft budget did not include new transfers to the Council's General Fund reserve. They also discussed the proposed increase in capital programme contingency to £10 million. The committee suggested reviewing major spending areas such as Newquay Airport and Adult Social Care for potential savings or alternative service delivery methods, and bringing forward transformation projects to the 2026/27 financial year.