Agenda item

“(a)    That subject to the items below, and following changes arising from the Local Government Finance Settlement, approval be given to the Medium Term Financial Strategy (MTFS) which incorporates the recommended net revenue budget for 2026/27 totalling £616.1m as set out in the revised Appendices A, B and E of this report and includes the growth and savings for that year as set out in the revised Appendix C, as amended by paragraph (a) (i) and (ii) below;

         

(i)       That the list of growth and savings proposals as set out in Appendix C be amended as follows:

	2026/27 £000s	2027/28 £000s	2028/29 £000s	2029/30 £000s
Additional Service Growth
NEW   Additional investment in public bus subsidies	120	120	0	0
NEW Additional environmental maintenance	300	300	0	0
1 x Weed spraying county wide - £60,000 for 2-years 1 x Visibility grass cut (urban and rural) - £80,000 for 2-years £160,000 additional footpath maintenance for 2-years
NEW Grit Bin 50% discount	5	5
Discount applies to the purchase, installation and initial provision of grit. For parish and district councils. Applications open from county councillors. For requests to be eligible they would need to meet the Council’s established criteria and be made by parish/town or district councils. A partial discount ensures that bin requests are focused on the locations most in need.
Total Cost Increase	425	425	0	0

 

 

(ii)      that the Total Cost Increase above be met from the Service Investment Fund;

 

(iii)      that the following addition is made to the “Robustness of Estimates and Adequacy of Reserves” section of the budget report:

 

Robustness of Estimates and Adequacy of Reserves

The expenditure increases are funded by redirection of existing budgets and there is no change to the budget gap or reserve balances over the 4-year period. On this basis the amendments do not alter my view of the robustness of estimates contained in the Council report. My recommendation will always be that whilst a financial gap is present discretionary expenditure should be minimised, and any savings should be directed to reduce the use of reserves needed to balance the budget. However, the position is still better than before the settlement, so my view on the robustness of estimates and level of reserves is unchanged.

 

 

(b)      That it be noted that the revised Appendices A, B, C and E reflect the changes in Revenue Support Grant, which reduces the use of reserves in 2026/27 and reduces the funding gap in 2027/28, and the allocation of £2.5m in the Service Investment Fund, as set out earlier in this supplementary report and as amended by paragraphs (a) (i) and (ii) above;

(c)       That approval be given to the projected provisional revenue budgets for 2027/28, 2028/29 and 2029/30, set out in revised Appendix B to the report, including the growth and savings for those years as set out in revised Appendix C, allowing the undertaking of preliminary work, including business case development, engagement and equality and human rights impact assessments, as may be necessary to achieve the savings specified for those years including savings under development, set out in Appendix D, as amended by paragraph (a) (i) and (ii) above;

(d)      That each Chief Officer, in consultation with the Director of Corporate Resources and following consultation with the relevant Cabinet Lead Member(s), undertake preparatory work as considered appropriate to develop proposals and associated investment required to reduce the financial gap in all four years of the MTFS, to enable the Cabinet, subject to scrutiny processes, to consider a new multi-year transformation programme;

 

(e)      That approval be given to the early achievement of savings that are included in the MTFS, as may be necessary, along with associated investment costs, subject to the Director of Corporate Resources agreeing to funding being available;

 

(f)        That the level of the General Fund and earmarked reserves as set out in the revised Appendix K, to reflect the updates for the High Needs Deficit cover as set out earlier in this report, be noted and the planned use of those earmarked reserves as indicated in that appendix be approved;

 

(g)      That the risk assessment at paragraph 140 and the Director of Corporate Resources assurance statement at paragraph 155 be noted, as amended by paragraph (a) (iii) above;

 

(h)      That the recommended Council Tax increase of 2.99% for 2026/27 and the resulting precept be approved;

 

(i)        That the Chief Executive be authorised to issue the necessary precepts to billing authorities in accordance with (g) above and the tax base notified by the District Councils, and to take any other action which may be necessary to give effect to the precepts;

 

(j)        That approval be given to the 2026/27 to 2029/30 capital programme, totalling £501m, as set out in Appendix F;

 

(k)       That the Director of Corporate Resources following consultation with the Cabinet Lead Member for Resources be authorised to approve new capital schemes and revenue spend to save schemes, including revenue costs associated with their delivery, shown as future developments in the capital programme, to be funded from funding available;

 

(l)        That the financial indicators required under the Prudential Code included in Appendix N, Annex 2 be noted and that the following limits be approved:

 

	2026/27 £m	2027/28 £m	2028/29 £m	2029/30 £m
Operational boundary for external debt
i)       Borrowing	194	200	225	255
ii)      Other long term liabilities	1	1	1	1
TOTAL	195	201	226	256
Authorised limit for external debt
i)       Borrowing	204	210	235	265
ii)      Other long term liabilities	1	1	1	1
TOTAL	205	211	236	266

 

(m)     That the Director of Corporate Resources be authorised to effect movement within the authorised limit for external debt between borrowing and other long-term liabilities;

 

(n)      That the following borrowing limits be approved for the period 2026/27 to 2029/30:

 

(i)      Maturity of borrowing:

 

	Upper Limit	Lower Limit
	%	%
Under 12 months	30	0
12 months and within 24 months	30	0
24 months and within 5 years	50	0
5 years and within 10 years	70	0
10 years and above	100	25

(ii)     An upper limit for principal sums invested for periods longer than 364 days is 25% of the portfolio.

 

(o)      That the Director of Corporate Resources be authorised to enter into such loans or undertake such arrangements as necessary to finance the capital programme, subject to the prudential limits in Appendix N;

 

(p)      That the Treasury Management Strategy Statement and the Annual Investment Strategy for 2026/27, as set out in Appendix N, be approved including:

 

(i)        The Treasury Management Policy Statement, Appendix N; Annex 4;

 

(ii)       The Annual Statement of the Annual Minimum Revenue Provision as set out in Appendix N, Annex 1; 

 

(q)      That the Capital Strategy (Appendix G), Investing in Leicestershire Programme Strategy (Appendix H), Risk Management Policy and Strategy (Appendix I), Earmarked Reserves Policy (Appendix J) and Insurance Policy (Appendix L) be approved;

 

(r)        That it be noted that the Leicester and Leicestershire Business Rate Pool has been revoked for 2026/27;

 

(s)       That the Leicestershire School Funding Formula is subject to capping and scaling and continues to reflect the National Funding Formula for 2026/27;

 

(t)        That delegated authority be given to the Director of Children and Family Services, following consultation with the Cabinet Lead Member for Children and Family Services, to agree the funding rates for early years providers for 2026/27.”