URL: https://democracy.arun.gov.uk/ieDecisionDetails.aspx?ID=1693

Decision Maker: Policy and Resources Committee, Full Council

Outcome:

Is Key Decision?: No

Is Callable In?: No

Purpose: This report considers the Council Budget for 2026/27 along with the associated statutory resolutions and precepts from West Sussex County Council, the Sussex Police & Crime Commissioner and Parish and Town Councils. The recommendations made by the Policy & Finance Committee will be forwarded onto a Special Meeting of the Council to be held on 25 February 2026.

Content: The Chair confirmed that before inviting the Director of Resources and Section 151 Officer to present the budget report, he proposed to start with the recommendations that had been submitted for this committee to consider from each of the service committees.  Each of the recommendations had been set out in the supplement pack circulated to the meeting and uploaded to the web and emailed to Councillors on 10 February 2026.  The Chair confirmed that he proposed to take these recommendations on block. The recommendations were as set out below and were from the:   ·       Housing & Wellbeing Committee – 20 January 2026 – Minute 497 – Committee General Fund Revenue and Capital Budgets 2026/27 – Page 2 of the supplement pack ·       Housing & Wellbeing Committee – 20 January 2026 – Minute 498 – Housing Revenue Account Budgets 2026/27 – Pages 3 and 4 of the supplement pack ·       Economy Committee – 22 January 2026 – Minute 510 – Committee Revenue and Capital Budgets 2026/27 – Pages 6 and 7 of the supplement pack ·       Environment Committee – 29 January 2026 – Minute 523Committee Revenue and Capital Budgets 2026/27 – Page 8 of the supplement pack ·       Planning Policy Committee – 2 February 2026 – Minute 535 - Committee Revenue Budget 2026/27- Page 9 in the supplement pack.   Having had these recommendations proposed by Councillor Nash and seconded by Councillor Walsh, the Committee             RESOLVED – That   (1)     The Revenue and Capital Budgets for this Committee [the Economy Committee] be included in the Council’s overall 2025/26 Revenue Budget;   (2)     The Revenue Budgets for this Committee [the Planning Policy Committee] be included in the Council’s overall 2025/26 Revenue Budget;     (3)      The Revenue and Capital Budgets for this Committee [the Environment Committee] be included in the Council’s overall 2025/26 Revenue and Capital budget;   (4)       The Revenue and Capital Budgets for this Committee [the Housing & Wellbeing Committee] be included in the Council’s overall 2025/26 Revenue Budget;   (5)  The Housing Revenue Account (HRA) Budgets 2025/26 be included in the overall 2025/26 budget; and   (6)  The Revenue and Capital Budgets for this Committee (the Corporate Support Committee) be included in the Council’s overall 2025/26 Revenue and Capital Budget.             The Chair confirmed that he would now focus on the whole budget for 2026/27. The Director of Resources and Section 151 Officer presented his report setting out the proposed General Fund, Housing Revenue Account (HRA), and Capital Programme budgets for Arun District Council for the 2026/27 financial year, together with associated Council Tax proposals and financial forecasts.   The Director of Resources and S151 in advance of presenting his report confirmed that Recommendation (f) regarding rent convergence was now redundant because the Government had delayed implementation until April 2027. This meant that it had no impact on the proposed 2026/27 budget and it should be withdrawn as a recommendation.   He explained that the final Local Government Finance Settlement, received on 9 February, resulted in only marginal changes for the Council, including a small £20,000 increase to the Homelessness Prevention Grant. Although the Revenue Support Grant would reduce by approximately £700,000, this would be fully offset by a new support grant, leaving the Council’s overall position unchanged.   The key highlights of the budget were then explained to the Committee, as summarised below:   The Fair Funding Review had been delivered and provided a three year settlement, subject to annual review. The council was able to set a balanced budget without using reserves due to a less severe funding reduction than anticipated. The medium-term financial forecast would be revised to reflect this and brought to the committee in the summer. Core Spending Power would still decrease slightly, though less than initially reported because of the settlement announced on 9 February 2026 The simplification of revenue grant funding represented a major change with many grants being consolidated into the Revenue Support Grant, simplifying the funding structure. The changes had been outlined in the report at Table 2 at Paragraph 4.5 of the report. Only a handful of grants remained ring fenced, the Homelessness Prevention Grant was one of those. Council tax increase was proposed at 3% or £5 as allowed in the 2026/27 referendum principles. Appendix 1 assumed an increase of £6.42 to £221.03 to the Council Tax Band D. The business rates pool following the reset of the business rates and the fair funding review outcome, would be disbanded for 2026/27. This committee had considered all the service committee’s revenue and capital budgets for 2026/27 and this committee was being asked to consider an overall budget to recommend to a special meeting of council on 25 February 2026. The total cost of the service committee budget proposals had increased by £0.718m to £29.593m. A summary table had been provided at paragraph 4.13 for members to refer to. Corporate costs had increased by £0.511m mainly because the council had added additional contingency to cover unknown events and items that could not be quantified such as the financial delivery of financial strategy work streams, Arun Arts’ financial support and other events unexpectedly arising such as large planning appeal fees The proposed HRA budget was presented with a forecast surplus and a proposed rent increase was 4.8%, with most tenants expected to be protected through Universal Credit. It was anticipated that the budget would increase the council’s usable revenue reserves in 2026/27 by an estimated £577k. This would be impacted if the proposals submitted by members set out in Paragraphs 4.33 and 4.38 were approved.   The Director of Resources and S151 Officer confirmed that the council maintained a healthy reserves position and reiterated that £10 million remained an appropriate minimum reserves level. Capital programme figures remained unchanged pending further cost information, but it was hoped that some revenue reserves could be used to fund some of the larger capital schemes such as the Angmering Sports Hub.   Finally, members’ attention was drawn to the budget consultation results that had been included in the report at Appendix 5. The Director of Resources and S151 Officer confirmed that the council’s budget estimates were robust, and the proposed reserves were adequate for 2026/27.   Ahead of inviting a proposer and seconder, the Monitoring Officer was asked how to handle Recommendation F. The Monitoring Officer and Section 151 Officer agreed to confer and provide advice during the debate.             The recommendations were then proposed by Councillor Lury and seconded by Councillor Nash.             The Chair thanked the Director of Resources and S151 Officer and the Finance Team for their hard work which had been challenging, given the late settlement received on 9 February 2026.             The Chair invited debate. A Member welcomed the report and expressed strong support for the achievement of a balanced budget with a surplus, describing it as a significant and positive outcome for residents. The Member recorded his thanks to officers for their work in delivering this position.             Attention was drawn to the three member led proposals referenced in the report and the value of the Business Support Grants was particularly highlighted recognising their importance in assisting local businesses and making effective use of the final year of the Business Rates Pool. Also welcomed was the proposal to fund a beach access wheelchair, noting that although the cost was modest, the initiative would make a meaningful difference to residents with limited mobility.   Particular support was expressed for the proposal relating to the Windmill Entertainment Centre due to its long-standing role in providing theatre, performance and cinema in Littlehampton. The historic lack of investment in the building was emphasised with the proposed feasibility study being considered an essential and a timely step in ensuring the Centre’s continued viability and future improvement.   Debate concluded with a member reaffirming their appreciation for the balanced budget.             Councillor Nash, as seconder to the recommendations, confirmed that he was pleased to second the recommendations and stated that he could not recall a time when the authority had delivered a budget in surplus. This was an achievement to be celebrated. While recognising that such a position may not persist indefinitely, Councillor Nash encouraged the committee to welcome the positive outcome.             Councillor Lury, as proposer to the recommendations, commented that the Council’s improving financial position demonstrated the effectiveness of the administration’s financial strategy and prudent management. It was noted that the authority was no longer projecting a £5.2 million deficit, reflecting that appropriate actions had been taken to stabilise the Council’s finances ahead of local government reorganisation. On this basis, the budget was commended to the committee to support.             The Committee   RECOMMEND TO THE SPECIAL MEETING OF THE COUNCIL ON 25 FEBRUAY 2026             At 2.1   (a)The General Fund budget as set out in Appendix 1 is approved;   (b)  Arun’s Band D Council Tax for 2026/27 is set at £221.04, an increase of 2.99% over 2026/27;   (c)  Arun’s Council Tax Requirement for 2026/27, based on a Band D Council Tax of £221.04, is set at £14.805 million, plus parish precepts as demanded to be transferred to the General Fund in accordance with statutory requirements;   (d)  The HRA budget as set out in Appendix 2 is approved;   (e)  HRA rents are increased by 4.8% to give an average rent of £122.33 per week in line with the Government Rent Policy and the Regulator of Social Housing’s Rent Standard;   (f)   For HRA rents, the council introduces rent flexibility levels of 5% for general needs and 10% for sheltered accommodation for re-lets to new tenants in social rented properties only, taking into consideration local circumstances and affordability in line with the rent standard;   (g)  When HRA affordable rented properties are relet to new tenants, the applicable rent is reset to the lower of 80% of market rent (inclusive of Service Charges) or Local Housing Allowance with effect from 6 April 2026 in line with government policy;    (h)  That HRA garage rents are increased by 4.8% to an average rent of £16.84 per week (excluding VAT)   (i)    That all service charges for sheltered and communal areas are reviewed annually to ensure full cost recovery and that the charges are adjusted (either increased or reduced) appropriately to reflect this   (j) The general fund and HRA capital programme 2026-2031 as set out in Appendix 3 is approved.   The Council is requested to note:   (k) That the Director of Resources and Section 151 Officer, in consultation with the Leader of the Council has approved a tax base of 66,978 for 2026/27;   (l)  That the HRA budget will provide a surplus of £0.227m which will increase HRA forecast balances to £1.433 m bringing them closer to the Council’s set minimum balance of £2 million;   (m) That the General Fund budget will increase the Council’s Usable Revenue Reserves by £577,000 as set out in Appendix 4; and   (n)  The results and commentary of the public budget consultation process as summarised in Appendix 5.   At 2.2   Having considered the budget proposals set out in paragraphs 4.35 to 4.37 of the report that they are recommended to Full Council for inclusion in the 2026/27 revenue budget.  

Date of Decision: February 12, 2026