URL: https://rother.moderngov.co.uk/ieDecisionDetails.aspx?ID=1956

Decision Maker: Cabinet

Outcome:

Is Key Decision?: Yes

Is Callable In?: No

Purpose: To consider and agree the Council's Medium Term Financial Plan

Content: Consideration was given to the report of the Director of Resources on the draft Budget for 2026/27 and Medium Term Financial Plan 2026-2029 (MTFP).  The Budget had been scrutinised by the Overview and Scrutiny Committee (OSC) on 26 January 2026 and a copy of the Minute arising from the OSC meeting had been appended to the report for Cabinet’s consideration (Appendix H).  The OSC had recommended that the 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.   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); including the additional in-year overspend forecast, 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 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.  It was noted that £7.6m of National Lottery Heritage Funding had been awarded to support the installation of energy efficiency products to the De La Warr Pavilion (DLWP).  The total approved CP budget for this project was now £26.1m; ·      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; ·      overspends in 2025/26 were anticipated to reoccur in 2026/27; ·      an 3.8% inflation rate was assumed for 2026/27 which would only be applied to expenditure budgets where the Council had a contractual commitment to an uplift; ·      a 3% staff pay increase had been budgeted; ·      no anticipated savings from the devolution project had been incorporated within the Budget at this time; ·      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 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%, 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.)   The budget consultation closed on 5 January 2026, and the results were set out in Appendix G to the report. A late response had been submitted by Camber Parish Council and circulated to Members before the meeting. The consultation had received a total of 83 responses, with the majority of questions receiving around 40 responses; Members were concerned that this was not a true reflection of the views of all residents.   Some Members of Cabinet raised concerns about the proposed DLWP grant reduction. After some discussion, Cabinet agreed to recommend notice be given to the DLWP of a 10% grant reduction from 2027/28, but that the decision was taken subject to a further report to Cabinet on the DLWP funding and future options appraisal.   Cabinet paid tribute to officers for managing to present a balanced budget without drawing from reserves and were supportive of the OSC’s recommendations.   RECOMMENDED: That the amendment to the Capital Programme, as detailed in Appendix D and paragraphs 50 to 58 of the report, be adopted.   AND   *RESOLVED: That:   1)     the draft Budget for and Medium-Term Financial Plan, as noted in the report and appendices, be the basis for preparing the final 2026/27 budget and Council Tax recommendations to full Council;   2)     the Council Tax for 2026/27 at Band D be increased by £6.30 (2.99%) and set at £216.95;   3)     the fees and charges outlined in Appendix E to the report, be approved;   4)     the Director of Resources be authorised to sign the National Lottery Heritage Fund grant offer in respect of the De La Warr Pavilion award of £7.6m outlined in paragraph 54 of the report;   5)     winter car park tariffs in Camber remain the same as the previous year;   6)     the annual contribution to the Rye Harbour Nature Reserve be  reinstated in the Budget; and   7)     notice be given to the De La Warr Pavilion (DLWP) of a 10% grant reduction from 2027/28, subject to a further report to Cabinet on the DLWP funding and future option appraisal.   *The RESOLVED parts of this Minute are subject to the call-in procedure under Rule 16 of the Overview and Scrutiny Procedure Rules by no later than 4:00pm on 12 February 2026.   (Councillor Barnes declared an Other Registerable Interest as a member of Friends of Rye Harbour Nature Reserve and the Sussex Wildlife Trust and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)   (Councillor Bayliss declared a Non Registerable Interest as a Patron of the De La Warr Pavilion and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)   (Councillor Field declared an Other Registerable Interest as a Trustee of the De La Warr Pavilion and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)   (Councillor Prochak declared an Other Registerable Interest as a member of the De La Warr Pavilion and the Sussex Wildlife Trust and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)   (Councillor Rathbone Ariel declared an Other Registerable Interest as a member of the Sussex Wildlife Trust and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)   (Councillor Timpe declared an Other Registerable Interest as a Trustee of the De La Warr Pavilion and in accordance with the Members’ Code of Conduct remained in the meeting for the consideration thereof.)  

Date of Decision: February 2, 2026