URL: https://northumberland.moderngov.co.uk/ieDecisionDetails.aspx?ID=417

Decision Maker: Cabinet

Outcome: Recommendations Approved

Is Key Decision?: Yes

Is Callable In?: Yes

Purpose: This report provides the proposed 2026-27 Budget and the Medium-Term Financial Plan (MTFP) covering the period 2026 to 2029, following the receipt of the provisional Local Government Finance Settlement 2026-27 in December 2025.

Content: RESOLVED that Cabinet make the following recommendations to the County Council: 1. Note that the figures contained within the Budget 2026-27 within Appendix 1 are based on the provisional Local Government Finance Settlement of 17 December 2025. 2. Approve the Revenue Budget for 2026-27 including the efficiencies totalling £18.539 million for 2026-27 contained within Appendix 1 (detailed in Appendix 11). 3. Approve a 2.99% increase in general Council Tax for 2026-27, noting that this is in line with the Government’s assumptions regarding the Council’s Core Spending Power and, within the Government’s referendum limit of 3.00%. 4. Approve a 2.00% increase in Council Tax for 2026-27 for use on Adult Social Care services; raising an additional £5.700 million to support the Budget 2026-27 and note that the assumed increase included in the MTFP is 2.00% for financial years 2027-28 to 2028-29. 5. Approve the Reserves Policy 2026-27 detailed in Appendix 2. 6. Approve: The net contributions from the Strategic Management Reserve of £18.777 million in 2026-27, and note the proposed net contributions from the Strategic Management Reserve of £12.582 million in 2027-28, and a net contribution to the Strategic Management Reserve of £3.932 million in 2028-29, contained within Appendix 1, comprising: a) non-recurrent pressures of £8.922 million in 2026-27, £4.663 million in 2027-28, and £2.523 million in 2028-29 (as detailed within Appendix 10 adjusted for expenditure funded from other sources as shown in the following table): 2026-27  2028-29 £m  £m  £m  Total non-recurrent pressures  13.898 8.262  2.799  Less: Pressures funded from other sources:   - Council Modernisation Programme  1.231 -  -   - Extended Producer Responsibility Expenditure  3.008 3.557 0.234   - Fire Control Staffing for Succession Planning  0.108 -  -   - Funded by Public Health Grant:            - Druridge Bay Fitness Centre   0.110 -  -     - Hirst Welfare Centre transitional support  0.100 -  -     - Northburn Sports and Community Centre  0.111 -  -     - Rothbury Pool and Gym  0.058 -  -   - Leisure Facilities Transitional Costs  0.250 0.042 0.042    8.922  4.663 2.523    b) revenue contributions to capital (RCCO) for capital investments as follows: 2026-27 2027-28 2028-29 ?  £m £m £m Blyth Relief Road  1.021 2.922 0.119 Schools Development Programme?  7.334 - - ?  8.355 2.922 0.119 c) estimated net costs relating to the financial restructuring of Advance Northumberland of £1.500 million in 2026-27, £1.740 million in 2027-28, and £1.990 million in 2028-29. d) contribution from the Strategic Management Reserve of £3.257 million in 2027-28?in order to?balance the Budget (further efficiencies will be identified when the 2027-28 budget is prepared as it is not appropriate to use reserves to fund recurrent expenditure). There is a contribution to the Strategic Management Reserve of £8.564 million in 2028-29 in order to smooth the budget. 7. Approve the use of the Public Health Revenue Grant Reserve of £0.379 million in 2026-27 contained within Appendix 1 and explained in the table at 3.6 a). 8. Approve the use of the Council Transformation Fund Reserve of £1.231 million to fund the Council's Modernisation Programme delivery costs in 2026-27 contained within Appendix 1. 9. Approve the use of the Leisure Reserve to fund £0.250 million in 2026-27 and note the proposed use of this reserve for the following two years totalling £0.084 million to fund leisure facilities transitional costs. 10. Approve the use of the Recruitment and Retention Reserve of £0.108 million in 2026-27 to fund the second and final year of temporary resources to enable succession planning within Fire Control. 11. Approve the Fees and Charges Policy 2026-27 detailed in Appendix 6. 12. Approve the Inflation Schedule for 2026-27 totalling £18.149 million detailed in Appendix 7, which includes a recurrent Pension Fund Revaluation saving of £4.705 million. 13.     Approve: the Recurrent Growth and Pressures Schedules of £10.809 million for 2026-27 and note the Recurrent Growth and Pressures of £25.338 million in 2027-28 and £4.432 million in 2028-29 included within Appendices 1, 8 and 9; and, the additional net revenue implications of capital and treasury management activity of £21.135 million, which includes: £1.000 million reversal of the Voluntary Minimum Revenue Provision; and the estimated net revenue costs associated with the financial restructuring of Advance Northumberland of £1.500 million for 2026-27. Members are also requested to note the net revenue implications of capital and treasury management activity of £10.396 million in 2027-28 and £4.925 million in 2028-29, which include the estimated revenue costs associated with the financial restructuring of Advance Northumberland of £1.740 million in 2027-28 and £1.990 million in 2028-29 included within Appendix 1. The costs associated with the financial restructure of Advance Northumberland will initially be funded from the Strategic Management Reserve.  These costs will be repaid to the Strategic Management Reserve in 2029-30 by Advance Northumberland (year five of Advance Northumberland’s Business Plan), as agreed by Council in March 2025 and are therefore cost neutral to the Council. 14. Approve the Non-Recurrent Pressures of £13.898 million for 2026-27 and note the Non-Recurrent Pressures of £8.262 million for 2027-28, and £2.799 million in 2028-29 included within Appendix 10. 15. Approve the Non-Recurrent Income of £0.283 million for 2026-27 and note the Non-Recurrent Income £0.269 million for 2027-28 and £0.221 million for 2028-29 included within Appendix 10. 16. Approve the schedule of efficiencies at Appendix 11 of £18.539 million for 2026-27 and note the efficiencies totalling £34.631 million already identified for 2027-28 to 2028-29 and the significant reliance on BEST efficiencies to balance the budget. 17. Approve the Capital Strategy 2026-27 to 2028-29 contained within Appendix 14. 18. Approve the revised Capital Programme detailed within Appendix 15 and note the net increase in the Capital Programme 2026-29 of £29.405 million and the reduction in Council funding requirement of £19.879 million detailed in Appendix 16. 19. Approve the delegation of the detail of the capital allocations and any subsequent in-year amendments to the Executive Director Place and Regeneration in consultation with the Cabinet Member responsible for improving our roads and highways for the following: Local Transport Plan (LTP) Highway Maintenance and Pothole Repair Fund Highway Maintenance Investment in U and C roads and footways 20.     Approve the delegation of the detail of the capital allocation for the School Condition Allocation, general and remedial programme to the Executive Director Children, Young People and Education in consultation with the Cabinet Member for Children and Young People. 21.     Approve the Capital Prudential Indicators 2026-27 to 2028-29 based on the proposed Capital Programme detailed within Appendix 17. 22.     Approve the Annual Minimum Revenue Provision (MRP) Policy detailed in Appendix 18. 23.     Approve the Treasury Management Strategy 2026-27 detailed in Appendix 19. 24.     Approve a delegation to amend the Budget 2026-27 and MTFP in light of any changes as a result of the final Local Government Finance Settlement to the Executive Director of Transformation and Resources (the Council’s Section 151 Officer) in consultation with the Cabinet Member for Finance and Value for Money if the final Settlement is received after the 18 February 2026 Council meeting. If the final Local Government Finance Settlement is received prior to the Cabinet or 18 February 2026 Council meeting, then a supplementary report will be provided to Members advising of any changes necessary.  

Date of Decision: February 10, 2026