a) Budget Scrutiny Working Group – Chair, Councillor Warhurst
b) Performance Scrutiny Working Group – Chair, Councillor Warhurst
c) Post-16 Education Task Group – Chair, Councillor Warhurst
Minutes:
[With agreement of the Committee, agenda item 12 - Task Groups, Short Sharp Reviews and Working Groups - Update Reports – was considered at this point in the meeting (after agenda item 4 – Public Speaking)].
The Working Group and Task Group updates were provided as follows:
a) Budget Scrutiny Working Group
Councillor Warhurst reported that the Group was due to meet on Friday 20th February 2026. An interim Budget update would also be provided at this meeting. An update on the Council’s Budget position was subsequently provided by the Assistant Director for Finance and Customer Services.
It was noted that the Council’s Medium Term Financial Plan (MTFP) position as reported in the MTFP 2026/27 to 2028/29 at the Executive Committee meeting on 13th January 2026 was an overspend of £345,000 for 2026/27, an underspend of £55,000 in 2027/28, and an underspend of £85,000 in 2028/29. Members were informed that there had been a number of movements since and the updated position on MTFP as of this meeting was that of an £177,000 underspend in 2026/27, £224,000 underspend in 2027/28, and £686,000 underspend in 2028/29.
It was explained that this updated MTFP position was due to a number of factors. For this financial year the budgeted gap of £1,062 million had been managed down through work around vacancy provision. In addition, there had been changes to the Council’s calculation of business rates appeals and loses in line with Government’s recommended practice and changes to assumptions on Members’ allowances reducing costs. An additional Council Tax growth had been built for 2027/28 as 180 properties would be added in the Borough and there were assumptions of Council Tax increases of 2.99% for 2027/28 and 2028/29. It was reported that the three-year final local government finance settlement for 2026/27 to 2028/29 had not resulted in significant movements to the Council’s budget position compared to previous assumptions.
The Assistant Director Finance and Customer Services highlighted that the key risks within the budget around the vacancy figure saving built into the budget following the establishment review, the inflation assumptions around areas such as Council’s contracts, and the delivery of £250,000 of savings across service areas as the savings targets had not been delivered by all service areas. It was highlighted that capital financing available to the Council at present was also restricted at £1.1 million compared to £1.6 million submitted in capital funding bids by the service areas and Rubicon.
In addition there were challenges in terms of the impact of local government reorganisation (LGR) on the Council’s revenue, sustainability constraints, and the need to deliver projects requested by elected members before the unitary local government structure is due to come into effect in April 2028.
To address these challenges, it was explained by the Assistant Director Finance and Customer Services that the review of reserves had been carried out and following this it had been proposed to create the following Reserves:
· Risk Reserve of £2.5 million
· Local Government Reorganisation Reserve of £500,000 in 2026/27 and £500,000 in 2027/28 (which would be profiled so that expenditure was matched to demand)
· Community Investment Fund of £1.6 million – to add to the current £1.1 million capital financing available and provide fund for projects.
It was noted that the Council also would work on policy for flexible use of capital receipts to utilise those for transformation projects where possible. It would also be the aim to increase the General Fund reserves slightly over the next three years.
Following the presentation of the Budget Update, questions and comments were made as follows:
· Mitigation of the £1.062 million budget gap – It was explained by Officers that the budget gap emerging out of last year’s Medium Term Financial Plan (MTFP) had been mitigated through work on this year’s budget through proposals as set out in the presentation provided.
· Utilising reserves before the Local Government Reorganisation (LGR) – The Deputy Leader and Portfolio Holder for Performance, Engagement and Governance addressed the Committee and explained that the Executive was currently reviewing the capital projects proposals for utilising some of the Council’s reserves before LGR unitarisation. It was explained that the Council needed to account for and assess what funds were realistically required for LGR. The Deputy Leader added that the reserves that could be utilised by the Council before LGR were therefore lower than the Council’s total reserves figure and the Council made a commitment to the Ministry of Housing, Communities and Local Government (MHCLG) that a proportion of the authority’s reserves would be handed over to a new unitary authority structure.
· Members queried when plans would be finalised for investing the Council’s reserves that could be utilised prior to the unitarisation in initiatives in Redditch. It was responded that most spend decisions were not yet made and that these decisions would take place over the next few months. The Deputy Leader explained that among the initiatives to be funded would be upgrades to or creation of play areas in parts of the Borough where this provision was lacking or insufficient.
· A question was raised regarding the protracted arrangements regarding some of the specific section 106 agreements. It was responded that a review of the Council’s Section 106 arrangements was currently ongoing. Officers undertook to provide a response to Members regarding the specific query raised in the meeting.
b) Performance Scrutiny Working Group
Councillor Warhurst reported that there were currently no meetings of Performance Scrutiny that were planned to take place.
c) Post-16 Education Task Group
The Chair of the Task Group, Councillor Warhurst, reported that the next meeting of the Task Group was due to take place tomorrow (18th February).
RESOLVED that
the Task Groups and Working Groups Update Reports be noted.