URL: https://cmttpublic.cheshirewestandchester.gov.uk/ieDecisionDetails.aspx?ID=2027

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 November. 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 November. 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 third review of the 2025-26 financial year.  This covered the period from 1 April 2025 to 30 November 2025 and summarised the key headlines for financial performance, covering revenue and capital budgets.   Councillor Carol Gahan, Cabinet Member for Finance and Legal, led the discussion on the item and the item was seconded by Councillor Nathan Pardoe, Cabinet Member for Inclusive Economy, Regeneration and Digital Transformation.   Cabinet Members were reminded that the Council, along with other councils nationally, continued to face unprecedented challenges.  The Council was reporting a forecasted underlying overspend of £14.5 million, which was slightly increased from the £14.4 million reported at mid-year review.  A significant proportion of this, £12.3 million, was due to an overspend in Adult Social Care, which continued to face significant financial pressure.  This included increased costs in the number of adults presenting with learning disability needs, the increased high cost care associated with these needs and the additional support needed in transitioning to adulthood.  Unlike the previous year, Children’s Social Care expenditure had stabilised, with the overspend reported as £1.5 million.  Children in Care numbers were lower than budgeted, although high cost placements were forecasted above the budgeted figures due to the complexities of the children requiring care. Due to volatility, this remained a key risk for the Council.   Members noted that mitigating actions, such as vacancy management and a reduction of non-pay related spend, had been taken across all departments in order to offset financial pressures. There had been a capital financial underspend and capital receipts for transformation had also resulted in an additional £2 million. This reduced the need to borrow and, with the delivered savings and mitigations, the forecast overspend pressure had reduced to £6.9 million from the £9.6 million reported at mid-year.  It was also reported that 92% of future savings within the financial year was still considered deliverable which would relieve financial forecast pressure and improve the Council’s financial resilience. In addition, it was noted that the balance of general reserve was forecasted as £25.2 million at 31 March 2026.  If the current overspend of £6.9 million was not mitigated, this would reduce the Council reserves to £18.3 million which would be considered below the risk assessed range and plans would need to be put in place to mitigate this in the Medium Term Financial Strategy.   Visiting Members:  Councillor Charles Hardy spoke in relation to the item.   Cabinet Members welcomed the comprehensive report and acknowledged the challenging financial situation for councils at both local and national level. Members recognised the statutory requirement to protect vulnerable adults and older people and acknowledged that 70p out of every £1 of Council Tax was allocated to Adult Social Care and, although costs had increased in relation to care provision, other council services needed to be funded from the remaining Council Tax.  It was hoped that proposed strategies to introduce new ways to deliver Adult Social Care would support savings as well as provide greater support for those adults transitioning to adulthood which, in turn, would create less demand on the service. The increasing ageing population within the borough was also highlighted, including the difficulties in quantifying the number of older people who may require future social care.   Members thanked the Director of Finance and the Finance team for all their hard work in response to the ongoing significant and difficult financial challenges the Council continued to face.   DECIDED:    That   Financial Performance:   1)            the forecast revenue and capital outturn of the Council as set out in the report be noted; 2)            the Council remains within all Prudential Indicators set for itself for the year (see paragraphs 4.91 to 4.92 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. RECOMMENDATIONS TO COUNCIL:   1)            Approve a £1.4m increase in the capital programme for the HRA Sutton Way scheme as detailed in paragraph 4.20; and 2)            Approve the revised Flexible Use of Capital Receipts strategy for 2025-26 as detailed in Appendix M (paragraphs 4.23-4.24).   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: January 14, 2026