Issue - meetings

To receive a report from the Deputy Chief Executive (S151) presenting an update on the 2026/27 Budget and to trail the emerging Capital Programme covering the period 2026/27 to 2030/31.

The Group had before it, and NOTED, a report * from the Deputy Chief Executive (S151) presenting an update on the 2026/27 Budget and the emerging Capital Programme covering the period 2026/27 to 2030/31.

The following was highlighted within the report:

·       This was only a very brief budget update since clarification from central Government was still needed. The forecasted position based on a number of assumptions was presented to the last meeting, no greater detail had been received from central Government since then. The autumn statement was due on the 26th November 2025 and that would give, at a very high level, national indications of where funding would go but not at a local authority level. The Council would have to wait until the Local Government Finance Settlement in December for that. Budget proposals had been presented and supported by this Group in September 2025. All the green recommendations were approved subsequently by the Cabinet. In terms of the HRA, there had been some amber proposals which the Cabinet was currently awaiting clarification on before reaching a decision.

·       In terms of the Capital Programme where there were new proposals or changes to the existing scheme, these were shown in Appendix 1.

·       Also included within the report was more information regarding the financial implications of ‘rent convergence’. The Government had consulted on either a £1 increase or a £2 increase in relation to formula rent. The £1 increase would generate additional income, but it would not move all properties on to the new correct formula rent. The Council would prefer the £2 cap to be the Government's outcome from their consultation because of the increase in the revenue that it would generate and also the movement of all tenants onto the correct formula rent by the end of a 10 year process. The outcome of the Government's consultation was awaited and once known, the Council would look to implement or at least consult on the options that the Government had selected.

Discussion took place regarding:

·       The meaning of the negative and positive figures in relation to the Housing Development Programme was explained.

·       The effect of the delay with the Government announcing it’s Budget mainly affected the General Fund and not the HRA as the HRA did not receive grant funding only tenant income.

·       Formula rent was set by Government. The only time the Council could currently bring rent in line with this was when there was a change of tenancy. It would take many years, perhaps decades to bring all rents in line with formula rent if rent convergence did not take place. Ultimately it would present a much fairer and consistent approach to rent setting than existed at the moment. It was not clear at the current time which option the Government was going to opt for.

Note: * Report previously circulated.