Agenda item

Cabinet Member with Special Responsibility Councillor Hamilton-Cox)

Report of Chief Officer Resources (report published on 8.1.26)

(Cabinet Member with Special Responsibility Councillor Hamilton-Cox)

Cabinet received a report from the Chief Finance Officer that provided an update on the Council’s budget strategy for 2025/26 and financial outlook up to 2030/31. Specifically, the report considered the budget and Council Tax proposals for 2026/27.

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

It is essential that the Council Tax rate is set in line with the Council Tax billing timetable. Any delay would put the Council at risk of not being able to collect the tax which would have serious cash flow implications.  In terms of the actual budget position, work is ongoing to provide a balanced budget. Public consultation/stakeholder meetings will be held over the coming weeks (including Budget and Performance Panel). The feedback from these meetings will be considered by Cabinet and incorporated into a final budget proposal which will be presented at the Cabinet meeting on 10 February 2026 and recommended to Council on 25 February 2026.

The latest budget position does not produce a balanced budget for 2025/26 and further intervention is necessary before Cabinet can be presented with a balanced budget.

Whilst the longer-term financial forecasts contain numerous estimates and assumptions, which will change over time, the forecasts clearly highlight potential annual and cumulative budget deficits over the next 5 years and the position the Council faces. Although this position is not unique to this Council, it is reflected nationally across many public sector bodies. The gaps identified for 2026/27, although are lower than previously forecasted, are still present. Members and Officers recognise the size of the challenge ahead including that of LGR and will look to manage the transitional change to ensure the Council delivers both its statutory and non-statutory services across the district.

Councillor Bottoms proposed, seconded by Councillor Riches:-

“That the recommendations, as set out in the report, be approved.”

Councillors then voted:-

Resolved unanimously:

(1)            That Cabinet recommends to Council a 2.99% increase to the Lancaster City Council element of the Council Tax as set out in paragraph 3.3 (option one) of the report which is an increase to the Band D Council Tax from £264.30 to £272.20.

(2)            That the recommendations and proposals in this report be referred to Council on 28 January for initial consideration prior to public consultation/stakeholder meeting on 3 February by Budget and Performance Panel, in order that any feedback can be provided to Cabinet at its 11 February meeting.

Officer responsible for effecting the decision:

Chief Officer Resources

Reasons for making the decision:

The budget framework in general sets out a financial plan for achieving the Council’s corporate priorities and outcomes which incorporate the above cross cutting themes. Equalities impact assessments are undertaken for the relevant activities which are reflected in the budget.

The decision enables the proposals to be considered by the Budget and Performance Panel and at January Council allowing Cabinet to make further recommendations back to Council to complete the budget setting process for 2026/27.