URL: https://rother.moderngov.co.uk/ieDecisionDetails.aspx?ID=1947

Decision Maker: Cabinet

Outcome:

Is Key Decision?: No

Is Callable In?: No

Purpose: This report summarises the work undertaken to date on the proposed revenue budget for 2026/27 , updates to the Capital Programme and Medium Term Financial Plan for the period 2026-2029. The report also incorporates the outcome of the public consultation following the Committee's consideration of growth, savings and fees & charges proposals for 2026/27. Members are asked to receive the report and submit any further recommendations for amendment to Cabinet.

Content: Members considered the report of the Director of Resources on the Draft Budget 2026/27 and Medium-Term Financial Plan 2026-2029 (MTFP), which summarised the work undertaken to date on the proposed Revenue Budget for 2026/27, updates to the Capital Programme (CP) and MTFP. The report also incorporated the outcome of the public consultation following the Committee's consideration of growth, savings and fees and charges proposals for 2026/27. Comments of the Overview and Scrutiny Committee would be submitted to Cabinet with any recommendations for amendments at its meeting on 2 February 2026.   Appended to the report were details of the proposed savings (Appendix A), growth proposals (Appendix B), summary Budget 2026/27 (Appendix C), Capital Programme (CP) (Appendix D), fees and charges (Appendix E), MTFP (Appendix F) and consultation report (Appendix G).   The following key issues were highlighted:   ·      it had been anticipated that £1.181m would be drawn from reserves during 2025/26, despite good progress against the agreed savings target; ·      £694,000 was being supported by the General Reserve (GR); with the additional in-year overspend forecast, this would reduce the GR to £3.819m. The anticipated loss incurred on the Hermes Property Fund of £420,000 and potential further £900,000 related to aborted capital schemes could reduce this further to £2.5m; ·      the Council’s Productivity Plan provided for up to £2.623m of its available capital receipts’ to be utilised flexibly, with £832,000 forecast for use in 2026/27.  The draft Budget had been set utilising flexible capital receipts where appropriate; ·      the CP continued to be under review and was constantly being updated and reforecast; a comprehensive update on several projects was included within the report, along with the Community Infrastructure Levy allocations; ·      the CP totalled £191m, with £124m spend in this and future years.  The projected outturn as at 31 March 2026 for 2025/26 was anticipated to be c£48m, with the remaining balance being spread over future years; ·      the draft Budget presented had taken into account the overspends in 2025/26, which were anticipated to be recurring in 2026/27. ·      the draft Budget assumed 3.8% as the rate of inflation for 2026/27, which had only been applied to expenditure budgets where the Council had a contractual commitment to an uplift; ·      a staff pay rise was due in April 2026, which for the first time would be linked to National Joint Council (NJC) negotiations. No agreement had yet been reached, but the Budget had been drafted with an assumed increase for all pay grades of 3%, however the opening negotiations with NJC were some way adrift of this assumption; ·      devolution work was still underway and it was now anticipated that the costs would continue to be incurred by RDC during 2026/27;  ·      the draft Budget incorporated all known costs and available funding at this stage for the new food waste collection service being introduced in 2026/27 for the Rother district.  This would be closely monitored in-year, as it was a new provision; ·      the Government’s 2025 Fair Funding Review (FFR) reset the Business Rates Retention System.  As a result, all East Sussex Councils had withdrawn from the 2026/27 Business Rates Pooling, as it no longer offered any benefit; ·      the local government financial settlement aligned with FFR principles and the autumn policy statement.  It introduced updated formulas and data, which focused on deprivation to assess council needs and set funding levels.  It also provided a multi-year settlement with major grant changes; ·      no announcements were made regarding support for Local Government Reorganisation (LGR) and Devolution; ·      for 2026/27, to ensure the Council remained within the referendum limit, it was assumed that a Council Tax increase of 2.99% to £216.95 (increase £6.30) would be agreed for a Band D property; ·      no change was proposed to the Council Tax Reduction Scheme; ·      most fees and charges had been increased by 3.8% (Appendix E to the report), with a few exceptions where charges had increased between 5% to 10%; and ·      the uplift in funding for 2026/27, as well as a reduction in pension contribution rates, had aided the overall budget position for the year, resulting in the Council being in a position to set the Budget, without drawing from reserves. (Appendix C to the report incorporated the latest budget position following the settlement.)   Public consultation on the draft Budget proposals for 2026/27 closed on 5 January 2026 and an interim report on the findings was attached at Appendix G to the report. The RV (Recreational Vehicles and Campervan) park proposals had since been removed from the schedules, due to issues with their deliverability in the short term and the consultation outcome for this proposal had been mixed.   Members were asked to consider if they wished to propose any amendments to the draft Budget to Cabinet for consideration at their meeting on 2 February 2026, as a result of the consultation feedback received, and the following points were noted during the discussion:   ·      due to Camber having received a lot of negativity over recent weeks as a result of bio-beads deposits from Southern Water, Members requested that winter car park tariffs remained the same as the previous year; ·      it was unknown whether the Government would be providing any further funding for LGR or the food waste collection service, although it was anticipated that the Extended Producer Responsibility funding would continue at current levels; ·      Members questioned the disparity between costs of annual car parking permits for Market Square car park and Lower Market car park in Battle and requested figures for the number of tickets bought from Pay Points in the area. Information would be provided after the meeting; ·      Members noted the better than anticipated Local Government Settlement, but raised concerns that it did not take full account of the costs of delivering rural services; ·      Members raised concerns that the Council would not be in a position to begin rebuilding its reserves over the next two years and ran the risk of depleting them further; ·      Members were keen that the Devolution Programme progressed urgently to ensure that assets the new unitary would be unable to finance could be passed on to parish and town councils as soon as possible. With over 60 assets to consider, the Programme would take time but it remained resourced and focused; ·      the annual contribution to the Rye Harbour Nature Reserve had been removed from the Budget in line with savings proposals; Members recommended to Cabinet for onward approval by full Council that this be reinstated; ·      Members suggested that it should be explored if there were a mechanism for heavier vehicles to pay a higher car parking fee due to the resulting increased wear and tear on car park surfaces; ·      Members suggested that concessions on bulky waste fees should be considered for residents on low income, however the Council would lose money on the contract cost if this was the case; and ·      the Community Grants scheme was very important to rural communities and opened up access to other sources of funding.   The Committee agreed to recommend to Cabinet for onward approval by full Council that winter car park tariffs in Camber remained the same as the previous year and that the annual contribution to the Rye Harbour Nature Reserve be reinstated in the Budget.   Members congratulated the Director of Resources and her team for their work on balancing the Budget without the use of reserves.   It was agreed that the above comments would be submitted to Cabinet at their meeting on 2 February 2026; it was noted that full Council would agree and set the Budget at its meeting on 23 February 2026.   RESOLVED: That the following recommendations of the Overview and Scrutiny Committee be considered by Cabinet when recommending the final Budget to full Council at its meeting on 2 February 2026:   1)     winter car park tariffs in Camber remained the same as the previous year;   2)     the annual contribution to the Rye Harbour Nature Reserve be reinstated in the Budget; and   3)     subject to 1) and 2) above being approved, the Committee recommend this Budget to Cabinet for onward approval by full Council.   (Councillor Maynard declared an Other Registerable Interest in this matter in so far as he was an Executive Member of East Sussex County Council and Lead Member for Adult Social Care and Health and in accordance with the Member’s Code of Conduct, remained in the room during the consideration thereof.)

Date of Decision: January 26, 2026