Issue - meetings
Budget Strategy and Medium Term Financial Strategy Update
Meeting: 16/10/2025 - Cabinet (Item 144)
144 Budget Strategy and Medium Term Financial Strategy Update 
PDF 1 MB
Purpose:
To set out the Budget Strategy to support the preparation of the 2026/27 revenue and capital budgets and present an updated Medium Term Financial Strategy forecast.
Recommendation(s):
That Cabinet resolves to:
1. Approve the 2026/27 Budget Strategy as outlined in the report.
Additional documents:
- Annex A - Exceptional Financial Support FINAL, item 144
PDF 520 KB
- Annex B - Fair Funding 2.0 Consultation FINAL, item 144
PDF 611 KB
- Annex C - Fair Funding 2.0 indicative impact FINAL, item 144
PDF 335 KB
- Annex D - Medium Term Financial Strategy 2026-27 UPDATE October 2025 FINAL, item 144
PDF 399 KB
- Annex E - Capital Programme 2026-27 to 2029-30 FINAL, item 144
PDF 494 KB
- Webcast for Budget Strategy and Medium Term Financial Strategy Update
Decision:
The purpose of the report was to set out the Budget Strategy to support the preparation of the 2026/27 revenue and capital budgets and present an updated Medium Term Financial Strategy forecast.
Councillor Patrick Coleman, Cabinet Member for Finance introduced the item.
The recommendations were proposed by Councillor Patrick Coleman and seconded by Councillor Mike Evemy.
RESOLVED that Cabinet Approved the 2026/27 Budget Strategy as outlined in the report.
Voting Record:
7 For, 0 Against, 0 Abstentions.
Minutes:
The purpose of the report was to set out the Budget Strategy to support the preparation of the 2026/27 revenue and capital budgets and present an updated Medium Term Financial Strategy forecast.
Councillor Coleman introduced the 2026–27 Budget Strategy and Medium-Term Financial Strategy, acknowledging the work of officers, particularly the Deputy Chief Executive and S151 Officer and his team. It was noted that while the report contained challenges, it also highlighted positive progress. Attention was drawn to the capital programme, particularly the significant funding allocated for new Ubico waste vehicles, emphasising the detailed planning underway to determine vehicle type, fuel source, and maintenance schedules.
Annex D was referenced, noting that red in the report indicated savings, while the budget cap at the bottom highlighted the potential scale of the budget gap if worst-case scenarios materialised. It was further emphasised that professional advice, including that from consultants PIXEL, underpinned the Council’s planning.
Councillor Patrick Coleman highlighted Annex C, showing that Cotswold was among the worst-affected councils under Fair Funding 2.0, reflecting the area’s relatively prosperous status. He also drew attention to Annex B, detailing financial support to struggling authorities, demonstrating the importance of careful financial management. It was also reported that the Council had made good progress on capital receipts and revenue management, and confirmed there was no immediate risk of applying for exceptional financial support. It was emphasised that the primary focus remained resident-focused transformation and smarter internal working projects, including digitalisation and AI efficiencies, to address the budget gap.
The Deputy Chief Executive and S151 Officer was invited to comment on the business rates pool. It was explained that the pool had retained approximately £40–50 million locally since its establishment in 2013–14, but this would likely be its final year. Cabinet noted that government guidance on Fair Funding 2.0 was still awaited, with PIXEL’s current interpretation suggesting a flatter funding position in 2027–28 and 2028–29 than the Council had previously assumed. It was stressed that further work was required to identify budget and efficiency savings, income generation, and potential funding gains to close the budget gap.
It was confirmed that the Council anticipated receiving a three-year provisional settlement before Christmas, which would allow more robust forward planning despite uncertainty from potential local government reorganisation. It was highlighted that the Council expected to generate a budget surplus of over £500,000 this year, adding to last year’s similar surplus, providing additional financial resilience.
Councillor Gina Blomefield observed that the Overview and Scrutiny Committee had rigorously reviewed the Council’s finances. She highlighted concerns over the funding gap, uncertainty in interest rates, inflation, and broader national and global factors, but expressed support for the approach led by Councillor Patrick Coleman and the Deputy Chief Executive and S151 Officer.
The recommendations were proposed by Councillor Patrick Coleman and seconded by Councillor Mike Evemy and subsequently put to the vote.
Voting Record:
7 For, 0 Against, 0 Abstentions.