URL: https://cmttpublic.cheshirewestandchester.gov.uk/ieDecisionDetails.aspx?ID=1996

Decision Maker: Cabinet

Outcome:

Is Key Decision?: Yes

Is Callable In?: Yes

Purpose: To inform Members of the financial performance of the Council as at the end of July. Members are asked to approve any proposed changes to the capital programme and revenue budget.  

Content: To inform Members of the financial performance of the Council as at the end of July. Members are asked to approve any proposed changes to the capital programme and revenue budget.   Cabinet considered the report of the Director of Finance which set out the financial performance of the Council at the first review of the 2025-26 financial year, covering the four-month period from 1 April 2025 to 31 July 2025.   Cabinet noted Cheshire West and Chester was facing significant financial challenge, as were other Councils. At first review, an overspend of £6.7 million was predicted. As in previous years, continuing demand across social care led to pressures on the budget and whilst investment was made in both Adults and Children’s Social Care to meet the growth, the demand reported in Adult Social Care was higher than the additional resources provided. Members noted that the growth in Children’s Social Care had stabilised and was reflected in the forecast position presented in the report.   For 2025-26, the forecasted overspend was £12.4m, due to increased demand in 2024-25 for Adult Social Care (Communities and Older People) over and above 2025-26 budgeted growth, increasing demand for support to younger adults (18-25) and delays in delivering savings targets in Communities and Older People and VIVO. Members noted that Adult Social Care had a number of initiatives that would control cost and reduce demand but this would not be fully achieved in the current financial year due to the time that some of the actions and decisions would require, and consequently savings on other activities and services outside these areas would be necessary to avoid drawdowns from reserves which would weaken the Council’s financial resilience.   Members were advised that £2.5m of mitigations had been identified to support the reported financial pressures. These were a mix of alternative funding sources and constraining expenditure such as vacancy management or reducing non pay related spend. Management Board had also informed services to take immediate action to reduce the forecast pressure and a meeting would be held with Management Board and Directors to review all high risk savings proposals and identify what further action would be required  to ensure in-year delivery of these proposals, or identify mitigation actions where savings would slip or were considered undeliverable   Councillor Carol Gahan, Cabinet Member for Finance and Legal, led the discussion on the item as proposer and the item was seconded by Councillor Louise Gittins, Leader of the Council.   Visiting Members: Councillor Charles Hardy spoke in relation to the item.   Cabinet welcomed the comprehensive report and recognised the ongoing challenges with Social Care funding. Members noted that it was positive to see stability in the Children’s Social Care, due to staff efforts, but the levels of demand combined with the complexity of needs, was often on a ‘knife edge’. For example, one family with six children would see the need for significant funding. This could also be applied to Adult Social Care. Likewise, Transport and Highways also faced overspend but was mitigated due to increased grant funding and discounts provided by the new contractor. Councill staff were thanked for their hard work in ensuring that all departments had delivered excellent levels of service whilst they faced the need to reduce costs.   DECIDED:    That   Financial Performance: 1)            the forecast revenue and capital outturn of the Council as set out in this report be noted; 2)            the Council remains within all Prudential Indicators set for itself for the year (see paragraphs 4.83 to 4.84 and Appendix L) be noted; 3)            the significant financial challenges facing the Council and the need to identify further in year mitigations to reduce the forecast overspend be noted.   Recommendation to Council:   The underspend on the capital financing budget in 2025-26 is used to support the in-year financial pressures rather than being transferred to the Long Term Liability Reserve.   Reason for Decision   To ensure the Council remains a well-managed authority, recognising and responding to emerging cost pressures and complying with current accounting requirements.   Alternative Options   The report sets out various recommendations. Members could choose not to approve the recommendations. However, this is not recommended as this would adversely impact the Council’s financial position.  

Date of Decision: September 10, 2025