Agenda item

The Committee will be invited to consider the draft budget proposals

for 2026/27, as agreed by Cabinet on 2^nd December 2025, so that

the comments can be included within the consultation response and

reported to Cabinet when it considers the budget at its meeting on

10th February 2026 and Council at its meeting on 25^th February 2026.

 

Contact: Sheila Dykes – Governance Manager

The Leader of the Council and the Chief Executive introduced the draft budget proposals for 2026/27, as agreed by Cabinet on 2^nd December 2025, and the Council Plan.  The following points were highlighted:

 

·       The Council Plan was in the final stages of development but there was still an opportunity for comments and feedback to be put forward.

·       The importance of the Council Plan was emphasised; the priorities established within it guiding decision-making on the budget.

·       The new three?year financial settlement from the Government allowed for improved long?term planning.

·       The four headline Council Priorities remained consistent:

1.  Getting the basics right.

2   Protecting the vulnerable.

3.  Enabling everyone to thrive and have successful lives.

4.  Economic growth.

·       Public consultation on the Council’s proposed budget had taken place, with early feedback appearing constructive.

·       Scrutiny formed part of the wider consultation process before the final decision was taken in February.

·       Additional revenue funding was proposed for priorities identified by residents and businesses, such as planning services, addressing fly?tipping and support for community organisations.

·       The updated Capital Plan included £35.1 million towards a new sport and leisure facility in North Kirklees to replace Dewsbury Sports Centre. It represented the continuation of the programme of investment into the local economy and infrastructure.

·       The Council’s financial position was improving, though there were still challenges and difficult decisions to be made.

·       It was important to maintain a focus on prevention to mitigate long-term pressures particularly in children’s and adult social care and close partnership working was taking place with providers and NHS colleagues.

·       A lot of work had been done in terms of reviewing the Capital Plan.

·       Most discretionary fees and charges had increased by 3% to reflect inflation.

·       Ensuring efficiency and effectiveness of services. Assessments had been undertaken of vacant posts and work was underway to establish how digital solutions could improve and support productivity and also maximise income for local residents.

·       The maintenance of appropriate risk management and governance practices, balancing risk awareness with enabling community?led activity.

·       The level of savings required had reduced over the last three years.

·       The level of engagement on the budget consultation had reduced compared to the previous year; this may be due to the controversial nature of some of the proposals for that year.

·       Initial analysis indicated that the key themesfrom residents related to highways and infrastructure, town centre regeneration and Council Tax affordability.

·       The financial implications of not applying an increase in Council Tax of 4.99%.

·       The strengthening of engagement with political groups and their leaders and the production of a detailed ‘budget book’.

·       The emerging themes informing the preparation of the Cabinet report scheduled for early February:

- The continued need for a strong focus on prevention and early intervention.  Special Educational Needs and Disabilities (SEND) provision was an ongoing challenge, and a White Paper was expected imminently, which would impact on responsibilities and funding arrangements.

- Workforce capacity; with most post deletions proposed being vacant posts; the Council continued to rely on natural turnover/wastage rather than compulsory redundancies.

- Pressures relating to housing supply and homelessness. Regular updates had been provided to the Council by the Deputy Leader, which reflected the scale and urgency of such challenges.

- Outdoor and community space maintained by the Council. Benchmarking indicated that Kirklees managed almost double the provision of comparable authorities, which created ongoing pressures across both capital and revenue budgets.

- Positive progress on digital transformation and service efficiency, whilst noting the importance of ensuring that digital approaches did not exclude residents who were unable to access services online.

 

Questions and comments were invited from Members, with the following issues being covered:

·       It was not possible to pick out one, top, priority. Protecting the vulnerable, both adults and children, was very important and resources had been put into the budget to ensure the demand was met. There was also a wish for residents to be able to see and feel the difference that the Council made to their lives. 

·       Fly-tipping was a persistent and costly issue; with sites being cleared only to be re-tipped within hours or days.  Suggestions included using CCTV, increasing prosecutions, and re-purposing land to deter fly-tipping.

There were two types of fly-tipping: commercial (e.g., unlicensed waste carriers) and community-based disposal within local areas. In terms of the commercial element, actions were being taken including vehicle seizures, prosecutions, naming-and-shaming and publicising enforcement action.  In respect of the other element. work was being undertaken to raise awareness in communities about the best ways to dispose of waste and the costs to them of repeated clearance operations. Additional resources had been dedicated to clearing hotspots and backlogs in clearance had improved.

·       The consultation methodology had been altered to allow broader responses compared to previous years’ proposal-specific approach. In terms of the level of response, it was considered that this was not unusual for a place like Kirklees and a small sample could be representative.

·       The formal consultation process had been supplemented through ongoing engagement with businesses, community groups, and service users throughout the year and the initial budget proposals reflected the outcomes from this.

There was a desire to increase the amount of local engagement but there was a balance to be achieved on the level of resources used for this and the added value.

·       Feedback on the consultation process itself had been generally positive.

·       The proposed £35.1m investment into replacing Dewsbury Sports Centre was welcomed. The Administration was committed to this but noted that it would be subject to approval by the Council.

·       Programmes of activity were to be introduced, led by Kirklees Active Leisure, with the aim of improving the health of residents, particularly in North Kirklees.

·       Additional Government funding for youth and leisure improvements was anticipated, with details pending and the Council was preparing to identify local priorities for such resources.

·       Maximising the use of existing facilities and resources such as parks, green spaces, and leisure facilities would be beneficial; ensuring that they were maintained, with equipment being fit for purpose and providing support to community groups that organised sport and recreational activities.

·       Innovative ways of making sports and recreational facilities accessible, particularly for children and young people, should be explored.

·       Regeneration plans needed to include support for local businesses in addition to buildings and infrastructure.

·       In response to a request for clarification in respect of ‘support for community organisations’ it was explained that it was considered that it would be helpful to map all existing support to voluntary groups, and that there was a recognition that support could take different forms, noting that this was not necessarily about finance but about how things were done.

The view was expressed that the Council tended to work better with large anchor organisations rather than smaller groups, with grassroots groups struggling with Council policies, procedures and rules and bureaucracy; having to deal with a number of different departments. It was noted that supporting the larger organisations was important so that they could continue to support the smaller ones.

The three-year financial settlement should assist the Council in being able to improve stability for the voluntary sector.

Noted that local ward members were not as involved in decision-making on local funding as in the past but had excellent knowledge of what support was needed for groups in their area. Ward budgets had been helpful in addressing this.

·       In terms of budget assumptions related to council tax collection rates, it was explained that the 2026/27 budget assumed an ultimate collection rate of 98.25%, which was marginally lower than the previous assumption of 98.5% although efforts would be made to achieve more than this.

·       Noted that ‘council tax equalisation’ had been introduced by government, which recognised the differences in tax?base strength between regions. Kirklees had gained from this adjustment.

 

The Portfolio Holder for Finance and Regeneration and the Service Director – Finance gave a presentation which highlighted:

·       A proposed revenue budget of £465 million for 2026/2027.

·       A capital programme (General Fund) of £269.6 million, with a total capital borrowing of £131.7 million.

·       A Housing Revenue Account (HRA) revenue budget of £115 million, with a capital investment of £73.8 million and £30.6 million of capital borrowing for 2026/2027.

·       Rising demand across Children’s Services and Adult Services, alongside wider inflationary impacts, affected the budget. An additional £40 million was proposed to be invested in services, with £24 million for Adults and Children’s Services.

·       To achieve a balanced budget, proposed new savings of approximately £7 million had been identified, which included the removal of vacant posts, efficiency measures and productivity improvements.

·       Proposed Council Tax increase of 2.99% for 2026/2027, with an additional 2% to fund adult social care which was in line with Government assumptions within the final settlement and would generate approximately £13 million in additional income to support local services.

·       The final Local Government Finance Settlement was expected in the second week of February.

·       The final budget report would be considered by Cabinet on 10th February and Council on 25th February.

·       The significance of the three?year financial settlement, which supported better long-term planning for both the Council and partner organisations. The changes to the approach in terms of Council Tax equalisation, which had benefited Kirklees, was also welcomed and the hope expressed that this would continue and support reductions in deprivation and improvements in residents’ quality of life.

·       The proposed budget had been drafted prior to the publication of the draft Local Government Finance Settlement.

·       An additional £23.1 million of funding had been assumed for 26/27.

·       An additional £39 million had been allocated to service areas, further to the circa £50 million added in the current year.

·       A reduction in employer’s superannuation rate which was expected to save £7.1million, subject to final confirmation in March.

·       Total savings of £10.7 million, comprising approximately £6.8 million of new proposals.

·       In relation to funding changes Council Tax income was to rise from £252.9 million to in the region of £267.8 million, driven by the 4.99% allowable increase, tax base adjustments and a revised collection rate of 98.25%.

·       Business rates retained income assumed an inflationary uplift of 0.8%.

·       The prudent view taken in relation to government funding, based on information presented in the summer, which equated to £6.8 million increase.

·       A reduced contribution to the collection fund deficit from £3.8 million to £3.2 million.

·       Planned contribution to reserves totalling £8.3 million, and an uplift in the annual contribution to the General Reserve of £1 million, with the strategy being to build them over a five-year period.

·       The changes since the presentation of the Medium-Term Financial Strategy in September 2025.

·       The figures for directorate savings proposals for 2026/27.

·       The Capital Plan and funding, 2025/26 to 2032/33 including additions and reductions.

 

Questions and comments were invited from Members, with the following issues being covered:

 

·       In respect of assessment of impact on staff from deletion of vacant posts it was noted that those that were to be deleted had been vacant for some time. Efforts had been made to avoid additional pressure on services without some sort of mitigation and assurance was given that posts had been filled where necessary.

Going forward the aim was to consider productivity through the use of digital technology and achieving better output from the available resources.

·       The size of the Capital Plan, which had been raised by the external auditors, and it was questioned how the budget reflected this. The £960 million in the General Fund was affordable in the Medium-Term Financial Strategy. A prudent view had been taken on interest rates over the period. Voluntary Revenue Provision (VRP) reserves were to be built up significantly over the next five years that could be called upon in future years when the Minimum Revenue Provision (MRP) costs increased. It was noted that the view of the auditors had been questioned as it was considered that the Council’s programme and borrowing was not out of balance when compared with other local authorities.

·       In relation to risk in the context of macroeconomic events; there was always some element of risk and challenge. Contingencies were built into the capital programme and monitoring was very important. Borrowing was taken at regular intervals over the short, medium and long term, at different rates, to achieve a balance and mitigate the risk. A prudent approach was adopted but the commitment to investment into the district’s towns, villages and infrastructure needed to continue.

·       The three-year settlement was welcomed; the Service Director would address the level of additional funding in a presentation later in the meeting.

·       There was an appendix to the budget report which illustrated how the desirable level of reserves was calculated and this was currently £29 million. This took account of the corporate risks. It was considered that the Council was taking a prudent and pragmatic view on what the level should be. It was suggested that it may be beneficial to have a higher level of visibility around the assumptions used to provide reassurance.

·       £5 million of borrowing had been removed in respect of highways as there was an assumption of grant funding; the money remained within the Capital Plan and borrowing would be reinstated if the grant funding did not come to fruition. The view was expressed that this money should still be borrowed to invest in the district’s roads to supplement the grant funding and address the backlog of repairs and maintenance to the highway network. This was an issue that had been raised during the budget consultation. It was noted that £9 million had been included in the budget as an amendment last year, for local community roads, and that remained in place and there was a need to balance ambition with what was/could actually be spent

·       The challenge in terms of the Capital Plan and matching delivery and ambition was acknowledged and the potential impact on the revenue budget if this did not happen. It was noted that a significant amount of the Capital Plan was to be achieved by funding other than Council borrowing, such as from the West Yorkshire Combined Authority (WYCA) or the Government.

·       The Public Works Loan Board rates changed twice a day and the current rates for five, ten and twenty years were given.

·       It was suggested that announcements were sometimes made too far in advance of delivery. Assurance was given that announcements were not made until the necessary background work had been undertaken and arrangements to deliver in place.

 

The Portfolio Holders and Executive Directors for Adults and Health, Children and Families, Place (including the Housing Revenue Account) and Corporate presented the key issues and key pressures affecting their work for 2026/27, the draft savings proposals for the year and the key borrowing for capital schemes.

 

At each stage, questions and comments were invited from Members, with the following issues being covered:

 

Adult Social Care and Health:

•       In respect of prevention to help address rising demands/cost of adult social care. A significant service re-design had taken place on front door services in 2025 to ensure people got an immediate response, and the ‘waiting well’ policy was also now well embedded. Internal targets were in place to manage demand.

Investment had gone into Community Plus services to undertake preventative work and divert demand from the ‘front door’ and ensure support for individuals within their community; the library hubs also assisted residents in accessing the right support.

•       It was queried how realistic the savings proposals were, with particular reference to those areas delivered alongside partners and in light of the current pressures on the Integrated Care Boards (ICB). Significant savings had already been achieved through the transformation change programme and there was confidence that this would continue. Work was being undertaken in respect of ensuring the proportion of ICB funding, for the two intermediate care provisions, was appropriate. The Council worked very closely with, and had a strong partnership with, the ICB and this would ensure that there was an awareness of any implications and complexities arising.

•       In relation to the move towards more out of hospital care there had been a significant amount of investment into community provision. The model being used, across the system, was ‘home first’ with the right adaptations and support, and the reablement offer had grown.

 

Children’s and Families:

•       The continued progress and improvements were welcomed despite the demand and complexities.

•       In relation to the work being done to increase the numbers of foster carers and Special Guardianship Orders (SGOs); the number of fostering households had increased and the split between the numbers of those provided by the Council and those by independent fostering agencies had improved. The diversity of carers had also improved. The Council was performing very well in respect of the number of SGOs. The importance of wrap-around support for foster carers was emphasised.

•       The review of the back-office functions would include consideration of any efficiencies or rationalisation that could take place in the light of the reforms expected over the next three years.

•       The minimal use of agency social workers was commended.

•       There was clear oversight of those children who were in placements external to Kirklees and each case was reviewed on a fortnightly basis to assess whether it was in the best interests of each child to return to the district. Education was a major element of this and the increased provision for children with social, emotional and mental health needs would assist in this.

•       There were no changes in the Safety Valve Agreement contributions.

•       In relation to working in clusters and the impact of this on dealing with demand, funding was being put into the schools, and early intervention approaches being taken and there appeared to be a stabilisation in the numbers requesting an Educational Health and Care Plan. The next stage would be to look at the impact and outcomes from this. The upcoming White Paper would determine the future direction of travel.

•       The most significant risk would always be the impact of significant regional or national issues affecting the number of children entering care.

 

Place:

•       It was noted that Kirklees had a large number of play areas in comparison with other local authorities. The money in the budget was to enable the expansion of play areas across the district.  Developers would make a contribution for provision within new housing developments.

•       The Council had a responsibility for the maintenance of play equipment in its play areas and this would be inspected to ensure that it was fit for purpose. There was a maintenance schedule for green spaces but they were not all dealt with in the same manner, the schedule had been reviewed in recent years to take account of the available resources but also with consideration of biodiversity responsibilities.

•       The increase in funding for the Green Space Action Team was to build on the previous investment in dealing with fly tipping, to ensure timely removal but also to progress work in respect of working with communities to effect behaviour change.

•       The budget provision for the Development Plan was for the activity necessary to prepare for the new Local Plan and also improve the enforcement response.

•       The funding for improved enforcement capacity was welcomed.

•       In respect of the transformation work on school transport; individual children would be assessed on the basis of their needs and the transport arrangements would then be discussed with parents who would have a choice in the solution. In terms of dedicated transport, the move was towards more efficient arrangements than individual taxis, and investments had been made into the fleet to facilitate this. There was also an element in terms of helping prepare children for independence. It was acknowledged that there was a need to work with families to ensure that any impact was minimised as far as possible.

•       The budget needed to be sufficient to deal with damaged equipment even if it was deemed safe so that play areas did not look neglected which discouraged use.

•       Developers should be asked to make a contribution towards existing nearby play provision rather than providing another new play area. This also avoiding residents having to pay a maintenance charge.

•       More money should be put into maintenance overall, including roads, pavements, weeding etc to foster pride in the towns and villages.

•       It was considered that to effectively transform the operation of planning, it was necessary to have an experienced planning officer to work alongside the team and focus on this. It was noted that such a proposal would be included within a bid for funding from the transformation budget. It was noted that consideration was being given to the use of technology to assist in speeding up processes where appropriate.

•       The additional funding to deal with seasonal weather was welcomed but there was concern that it was not enough to deal with the planned growth in housing in the district and the extension of the gritting routes to include secondary link roads should be considered. Assurance was given that if additional funding was needed during the year then additional budget provision would be considered. It was noted that the budget for gritting was to ensure key roads and routes remained moving. In comparison with other local authorities Kirklees performed well in this activity.

•       The use of patching of highways was considered to be ineffective and inefficient and the use of sectional repairs, that had been undertaken in previous years, was believed to be superior.

•       Residents were concerned about the capacity for clearing gullies and drains. The aim was to return to pro-active/cyclical maintenance.

•       The budget for car park meters in the Capital Plan was for the maintenance and replacement of older equipment.

•       Capital provision for Town Halls was associated with maintenance for these four buildings.

•       The additional resource into addressing fly tipping would be focused on enforcement as well as clearance. There had been investment previously into mobile CCTV equipment and this would be deployed in light of the available data. There would also be a focus on the educational aspects to try and prevent it from happening in the first place. Officers had liaised with colleagues in adjoining, and other local authority areas, on operational services provision.

•       The continued investment into town centres was welcomed.

•       In respect of work to deal with the effects of climate change; there were a number of budgets associated with climate activity and reducing carbon emissions and a significant amount of external income. There were core staff despite recruitment for local authorities in this area being challenging. Ongoing initiatives and core activities also contributed to this work, such as investment in Council properties making them more efficient and the procurement of a greener fleet.

 

HRA:

•       The Council had been mindful of the impact of the rent increase on tenants, notwithstanding it reflected inflation in the main. Two thirds of tenants were on some form of benefit which may mean that the increase would not have a direct impact. The money advice teams also worked with any who were vulnerable to financial hardship. Arrears levels were low and had dropped. It was noted that the investment into the housing stock would, over time, reduce the cost burden for tenants.

•       Work was undertaken with the private rented sector and this had proved to be effective; with reductions in homelessness presentation and better standards of temporary accommodation.

 

Corporate:

•       The Council had a contract with voluntary sector providers which had not changed; how it was funded had altered.

•       A digital transformation programme was in progress and would be looking at opportunities to use technology, including AI, to increase effectiveness and efficiency whilst complying with statutory duties. The risks associated with the use of AI were acknowledged as well as the need for training to ensure appropriate use.

 

The Portfolio Holder for Finance and Regeneration and the Service Director, Finance then gave a presentation on the impact of the provisional Local Government Finance Settlement followed by questions and comments covering:

•       The level of additional funding; anticipated as approximately £6 million un?ringfenced and £4.5 million ringfenced for 26/27 above the figures in the budget report.

•       The increase in Core Spending Power of £146.3 million 2026-28 and how this was calculated and the impact on Council Tax rates.

•       The additional government funding was welcomed, noting that Kirklees had fared better than some other parts of the country.

 

RESOLVED –

 

(1) That the Leader and Cabinet Members, Executive Directors, and Service Director, Finance be thanked for attending the meeting to present the budget proposals for 2026/27.

 

(2) That the opportunity for pre-decision scrutiny be welcomed and other Members of Council be thanked for their attendance and contributions to the debate.

 

(3) That the comments made be considered in taking the budget forward and be reported to Cabinet and Council at the meetings where the final decisions are taken.