Agenda item

This report sets out proposals contained in the Revenue Budget Report 2025-2026 as attached at Appendix A.  It also provides an overview of key issues arising from the Medium Term Financial Strategy.

Recommended                     -   That consideration be given to the report.

The Portfolio Holder for Resources, Councillor Alexander, submitted a report setting out proposals for the 2025/26 General Fund Revenue Budget, as attached at Appendix A of the report.  This also provided an overview of key issues which had arisen from the Medium Term Financial Strategy. 

The Council’s 2025/26 Revenue Budget required a net expenditure of £17,313,300 and under the budget proposals, Council Tax for Hyndburn residents would incur a rise in charge for Hyndburn Council provided services.  The charge for a Band D property would increase from £268.43 in 2024/2025 to £276.46. 

A number of national and global issues had had an impact on the Council’s budgets along with the impact of higher inflation and forecast pay settlements contributing to the Council raising its element of the Council tax by the maximum 2.99%, an increase of £8.03 annually on a Band D property.  Lancashire County Council, the Police & Crime Commissioner and the Lancashire Combined Fire Authority have not yet formally taken their decisions on Council Tax levels for 2025/26.  It is expected that all three authorities will raise its Council Tax.  Relating to Band D properties, Lancashire County Council is expected to raise its Council Tax by 4.99%, the Police and Crime Commissioner to increase by 5.31% and Lancashire Combined Fire Authority by 5.90%. 

Altham Parish Council has set a separate precept requirement for its activities and has decided to increase its precept by 2.66% and therefore, a Band D charge would increase from £43.18 for 2024/25 to £44.33 for 2025/2026. The Parish Council will precept the Collection Fund for £14,185.60 for 2025/26.  Details of the proposed position on other Bandings for properties in Altham are shown in Appendix 6 of the report. 

The Council faces continued volatility around some of the most significant items within its Budget.  Major reforms of local government finance have transferred the risk of business rate revenues and Council Tax benefits to the Council.  The certainty on which the Council could budget and manage its finances has therefore decreased since 2013.  The Committee was informed of the importance of plotting any deviations away from the expected figures and taking appropriate action should these start to emerge, which could result in the need to reduce spending during the year.

However, Committee was informed that Cabinet intended to continue managing the Council’s affairs effectively by continuing its successful policies to manage costs effectively and promoting appropriate service investment.  It would therefore: 

• Continue to limit enhancements on early retirement, continue a rigorous approach to absence management and commit to minimising borrowing costs. 
• The Capital Programme for 2025/26 would continue to deliver key investment in council and public facilities by adding another £2.48m to £44.87m the Council has already approved.
• A large proportion of the capital programme will be phased over the next few financial years which includes the delivery of £24m investment in Accrington Town Centre and a continued £12m investment in the borough’s Leisure Estate.
• Continue free parking in Hyndburn Borough Council.
• Rationalise the use of Council buildings and continuing to look at ways of reducing carbon emissions and energy costs.
• An addition to the programme in 2025/26 of £2.48m to include further investment of £317,000 in Parks and Plays areas, £1,359,906 for Disabled Facility Grants, £115,000 to maintain and invest in the Council’s operational assets and vehicle fleet, £419,500 to improve and develop ICT and technical equipment, £177,800 on UK Shard Prosperity projects and £87,000 on community projects including War Memorial restoration, Christmas decoration replacement and Maiden Street clock tower lighting.

The following information was attached to the report, which had been submitted to Cabinet on 12^th February 2025:- 

·         Background to Revenue Budget 2025 -26

·         Medium Term Financial Strategy

·         Continuation Budget

·         Growth & Inflation Pressures

·         Available Resources

·         Resources Summary

·         Budget Proposal

·         Budget Saving Proposals

·         Reserves

·         Risks & Management

·         Consultation

·         Conclusion

• Appendix 1 –   Initial Outline Budget 2025/26
• Appendix 2  -  Revenue Budget 2025/26
• Appendix 3  -  Budget Movements in Year 2025/26
• Appendix 4  -  HBC Tax Increase 2025/26 by Property Band
• Appendix 5  -  Estimated Overall Change in Council Tax 2025/26
• Appendix 6  -  Altham Parish Precept by Property Valuation Band 2025/26

Members submitted two questions in advance of the meeting, in respect of Local Government reorganisation and commitment to expenditure and, secondly, in respect of support for Leisure Services.

The Committee was referred to information provided by the Government in respect of supporting Council’s through reorganisation and in respect of approval of funding for projects.  The Committee was informed that the Capital Programme covered a 3 year period but only actually approved funding for works currently, in the existing approved programme from 2024/25 plus for new fully funded additions in 2025/26.  Funding for any works highlighted after this period would need approval and be dependent upon appropriate financing, as determined at the time.  Councils would continue to deliver their business as usual until reorganisation was complete.

In respect of how consideration would be given to providing extra funding to the Leisure Trust, should it be required, the Committee was informed that discussions between the Cabinet Portfolio Holder and Hyndburn Leisure had taken place and plans had been agreed for the future monitoring and development of their performance.  Details of this were provided at the meeting.

Further questions on the following issues were raised by Members of the Committee, at the meeting, followed by responses from the Cabinet Portfolio Holders and the Executive Director, Resources:

-       Commitment to the funding for improvements to Oswaldtwistle Civic Theatre

-       A funding pledge for Mercer Hall

-       Disabled Facility Grant commitments

-       Council Tax levels

A member of the public submitted two questions, in respect of the Revenue Budget.  The questions and responses are set out below:

1.    The revenue budget report records a reserve of £2.5 million and states that a minimum reserve of £1 million should be maintained.  £1 million was granted to Hyndburn Leisure Trust in January.  Which budget has this been taken from?  And what effect will this have on the reserves?

Response:  The meeting was informed that the £1m granted to the Hyndburn Leisure Trust was taken from the Revenue Budget but that this would have no effect on the Council’s reserves.

2.    In addition to the £1m grant to Hyndburn Leisure, the revenue budget report indicates that they will need another £700,000 in 2025/26.  The report also states that the Trust hasn’t completed its 2025/26 budget.  What accuracy is attached to this predicted funding amount?  And, what assurances can the Executive Director for Resources give that Hyndburn Leisure will not need any further funding in the year.

Response:  The meeting was advised that the Council was working closely with Hyndburn Leisure and had agreed ways to monitor the Trust more closely and this would help to determine if the additional funding would be required.

Cabinet made the following recommendations to Council:

                                                  (1)   That there be an increase in Council Tax for 2025/26 by 2.99%, increasing the charge for a Band D property to £276.46.

(2)    That the Budget for 2025/26 will be £17,313,300 as detailed in Appendices 1 to 3 of the Revenue Budget 2025-2026 report, attached at Appendix A to the covering report.

(3)    That changes in budget requirement including through inflation, growth and savings identified in Appendix 3 of the Revenue Budget 2025-2026 report be approved, to ensure the Council can set and approve a balanced budget.

(4)    That the significant improvement made in relation to budget monitoring and cost reduction within the Authority over the past 20 years be noted and its commitment to continuing this approach in the year ahead be confirmed.

(5)    That during the financial year 2025/26, the Executive Director (Resources) be delegated responsibility to amend the Budget (following consultation with the Leader of the Council) for technical reasons, such as the restructuring of cost centres, the re-apportionment and re-allocation of overheads etc., provided such amendments have an overall neutral impact on the Budget.

(6)    That during the financial year 2025/26, the Executive Director (Resources) be delegated responsibility to amend the Budget (following consultation with the Leader of the Council) should the estimate of Business Rates not be sufficiently accurate, by drawing on reserves if needed or paying over additional contributions to reserves.

(7)    That, to aid future financial management planning any surpluses generated during 2025/26 are set aside to help the Council reduce its cost base over the next three years, to support its long term capital programme or to strengthen its overall reserve position.

(8)    That the Extended Producer Responsibility Grant be set aside in reserves to be drawn down as required, so the Council could meet its obligations under the legislation.

(9)    That any additional funds from Government that are not ring-fenced funding as well as any other surplus funds could be used if required to support Capital expenditure as determined by the Executive Director (Resources) in the overall financing of capital expenditure or be transferred to Reserves.

Resolved                               -   That the contents of the report be noted and supported.