Agenda item

The Corporate Director of Finance, Steve Muldoon and the Corporate Director for Residents’ Services, Dan Kennedy, presented the report. Other officers in attendance to respond to Members’ questions were Matt Davis, Director – Strategic and Operational Finance, Ceri Lamoureux, Head of Finance and Bernard Ofori-Atta, Head of Finance.

It was explained that the overall Council budget had been reviewed by the Corporate Resources and Infrastructure Select Committee earlier in the week, with a more detailed discussion available via the meeting recording. The Corporate Director of Finance outlined the wider financial context, noting that the Medium-Term Financial Strategy, published in December 2025, reflected a highly challenging environment driven by rising demand, market pressures in social care and temporary accommodation, and inflation outpacing funding levels.

It was noted that Government funding for Hillingdon had increased but would be phased in over three years. Council reserves had been significantly depleted in recent years, reducing financial resilience. As a result, the Council required budget growth to meet unavoidable pressures and had identified a number of difficult savings proposals. To balance the 2024/25 budget legally, the Council was seeking Exceptional Financial Support (EFS), which required central Government approval and repayment.

Members heard that all savings proposals were owned by senior officers, had been through internal challenge sessions, and were intended to be realistic rather than aspirational. Further detailed work was still required, particularly on high?risk or high?value proposals, and ongoing improvements to demand modelling and savings monitoring would continue.

It was noted that the meeting would focus on the proposals within the Residents’ Services Select Committee’s remit, including assumptions, savings, growth proposals, risks, and service impacts. The output would be the Committee’s feedback and recommendations to Cabinet, to be considered alongside responses to the six?week public consultation. Final budget decisions were scheduled for Cabinet on 19 February and full Council on 26 February 2026.

It was noted that a net budget increase of approximately £15.8 million had been proposed within the remit of Residents’ Services. This increase was composed of nearly £30 million in growth alongside £14 million in savings. It was explained that the majority of the growth had been driven by demand pressures, particularly in relation to homelessness, as well as the need to address legacy income targets and other longstanding budget pressures. An example was provided in which the budget for tree inspection and maintenance had been proposed for an uplift of £130,000 to ensure statutory duties continued to be met as tree numbers expanded across the Borough.

Members were informed that the efficiencies and savings proposals had been presented as arising from a range of service areas, with an emphasis placed on doing things differently. It was highlighted that greater collaboration across services, deployment of digital technology, expansion of self?service options, and process improvements designed to achieve tasks correctly at first attempt were being prioritised. Joint working both within Residents’ Services and across the wider Council was expected to generate reductions in expenditure.

With reference to the proposed 10% increase in discretionary fees and services, Members sought clarification as to how the increase supported continued value for money for residents, whether the Council would remain benchmarked among the lowest?cost boroughs in London, and whether comparative information from neighbouring authorities could be provided. It was stated by officers that the Council had continued to be recognised as a value?for?money, high?quality service provider, supported by strong benchmarking across adult social care, children’s social care and housing services. It was confirmed that the Council’s fees and charges had historically remained positioned at the lower end relative to other London and West London boroughs. Officers noted that the proposed increase of the waste subscription charge to £77 would still leave the Council’s costs lower than neighbouring authorities operating fortnightly collections, while Hillingdon continued to offer weekly collections. It was confirmed that additional benchmarking data could be made available outside the meeting.

A question was raised by Members concerning how the increase in fees might affect take?up of services, with reference to a previous decline in green waste subscriptions. It was asked what the implications would be should insufficient numbers of residents use those services and what measures had been considered. In response, Members were informed that all proposals had undergone significant testing, including assumptions around expected income. Where increased fees carried uncertainty, income projections had been cautiously reduced to account for potential reductions in demand for discretionary services. A further question was posed as to whether such reductions could prevent the Council from achieving planned savings. Officers were confident that income levels set out in the budget would be achieved. It was stated that where new services carried greater uncertainty, income projections had been intentionally lowered. Reference was also made to corporate contingency funds maintained to mitigate non?delivery of savings or unexpected cost pressures.

Housing budget proposals were then queried. Councillors referred to the planned £8.5m savings and asked whether this represented continuation of current initiatives or acceleration of existing work, noting the scale of the existing pressures. Officers explained that a wide programme of initiatives was under way, particularly aimed at increasing access to private rental sector accommodation. It was reported that active discussions were ongoing with agents and landlords to increase supply, prevent homeless households from entering temporary accommodation, and to expedite move?on pathways. Various models were described, including temporary placements that could convert into private?rented tenancies, thereby discharging homelessness duties. It was explained that negotiations for multi?year arrangements were being explored to secure lower pricing from landlords and agents. It was further stated that a portion of the £8.5m savings related to inflation control, whereby keeping inflation below projected levels would contribute to the target. Officers acknowledged the challenge but confirmed that proactive work was already being undertaken.

The Committee sought clarification in relation to potential future arrivals and asked whether any advance notice from government had been provided and what contingency existed should such pressures reoccur. It was confirmed that no prior notice was given because the arrivals involved UK nationals acting independently. It was stated that contingency funding had been built into the budget for unforeseen increases in demand. It was emphasised that lobbying was being undertaken to secure government funding, as only a small number of port?authority councils had been affected.

A question was raised about emergency tree maintenance provision. Councillors observed that limited budget seemed to have been allocated for unplanned pressures, such as storm?related tree damage, and asked how the associated risks were being managed and whether a dedicated external agency might offer improved budget stability. Officers stated that statutory tree safety duties would always be fulfilled, regardless of in?year budget pressures. It was confirmed that a corporate contingency fund existed for unforeseen emergencies. Officers also highlighted a proposed £430k increase in the tree maintenance and inspection budget, intended to strengthen proactive maintenance and reduce the likelihood of storm?related failures. A follow?up question asked whether further funding could be secured if the £430k were exhausted. Officers stated that contingencies could be used, or costs could be mitigated elsewhere within service budgets. The Chair added that the £430k represented an increase, not the total budget.

Members asked for information on the number of people sponsored under the Council’s sponsorship policy and the income generated. It was confirmed that detailed data would be provided separately.

Councillors raised questions regarding the Green Lane civic amenity site, where tables within the budget documentation appeared to present seemingly duplicated figures of £70k and £165k. It was explained that the two £70k figures related to separate items—one a saving offset by software costs—and that the £165k represented a pressure from undelivered savings carried forward into the next financial year.

Waste collection efficiencies were then queried, with Councillors asking how a significant projected saving would be achieved. Officers explained that a service review was under way, focusing on waste prevention and diversion to lower?cost disposal streams. Initiatives such as the “simpler recycling” programme and food?waste diversion were highlighted as key cost?reduction mechanisms. Members asked whether the roll?out of food caddies to 20,000–25,000 flats was part of this work, and it was confirmed that the rollout to flatted properties was imminent and would significantly reduce costs by diverting food waste from residual streams.

The Committee asked how confident officers were that all proposed savings would be delivered, and what proportion of them could be considered secure. It was stated that all proposals had been through rigorous scrutiny, and that every efficiency was intended to be delivered. It was noted that, where external factors prevented delivery, directors would manage pressures through cost?control measures and internal mitigations. It was also stated that new spend?control measures required approval for all new expenditure and were expected to support delivery of savings.

A question was asked regarding the effectiveness of consultations, noting that past consultations had not always aligned with final decisions. Concern was raised as to how resident feedback could be ensured meaningful consideration. The Chair observed that consultations were not referendums and that final decisions were the responsibility of Cabinet and, ultimately, the electorate during elections. It was confirmed that the Councillor’s concerns would be recorded in the minutes.

Members sought clarity concerning fair funding and EFS. They asked whether fair funding was also conditional and whether it required Council Tax to be increased to the referendum limit over three years. Officers confirmed that the government’s figures had been predicated on all councils applying a 4.99% increase in each of the three years. It was explained that business?rate assumptions carried risk, particularly relating to appeals, and that EFS constituted borrowing requiring repayment over 20 years, plus interest if borrowed from the Public Works Loan Board.

Councillors requested further detail on investment in major capital projects, including the water sports facility and crematorium refurbishment, and asked whether these projects were expected to generate sustainable income. Officers stated that the capital programme encompassed schools’ expansion, the new leisure centre, new council housing, and significant housing investment to meet the decent homes standard. The water sports facility was described as a modern replacement offering improved amenities, while the crematorium improvements were intended to maintain service quality and introduce operational efficiencies. It was confirmed that income generation was sought where feasible.

A further question concerned how contingency funding would absorb unplanned pressures such as resident services, community safety needs, and emergency works. In response, it was confirmed that directors would be expected first to manage pressures within their budgets, including through internal mitigations and cross?service efficiencies. Underspends would be banked to offset pressures elsewhere and spend?control measures were expected to encourage cultural change and prevent unnecessary expenditure.

In response to Members’ questions regarding how the Council determined when efficiencies were negatively affecting frontline services, it was stated that thorough appraisals and impact assessments were undertaken during the planning process. If unforeseen impacts emerged during implementation, officers would reassess the proposal and present options to Members, ensuring that residents remained prioritised.

It was confirmed that comments from the Committee would be delegated to the Democratic Services Officer, in conjunction with the Chair and in consultation with the Opposition Lead, for submission to Cabinet.

RESOLVED: That the Select Committee:

1.    Noted the draft revenue budget and Medium-Term Financial Strategy proposals for 2026/27 to 2030/31 relating to services within the Committee’s remit;

2.    Considered and commented on the financial assumptions, savings proposals, growth pressures, service impacts and delivery risks within those proposals; and

3.    Agreed that comments to Cabinet for consideration as part of the final budget proposals to be presented to Council in February 2026, be delegated to Democratic Services in conjunction with the Chair and in consultation with the Opposition Lead.