Agenda item

The Committee considered the Month 10 budget monitoring report. It was reported that the Council was forecasting a net overspend of £36.3m, representing a £0.4m adverse movement from Month 9 but remaining broadly stable since Month 6. Members were advised that an additional internal review had been undertaken ahead of year end and had identified no material change.

It was explained that the adverse movement largely related to the interventions and mitigations line, where forecast mitigation had reduced from £1.0m to £0.5m. This was attributed to favourable movements elsewhere being treated as mitigation, including a £0.5m receipt from the West London Waste Authority. Members were advised that the underlying pressure remained primarily within service budgets.

A net £0.8m favourable movement was reported across services within the Committee’s remit, comprising £0.1m in Finance, £0.1m in Corporate Services and £0.6m in Place. The Place improvement was largely attributable to lower National Non?Domestic Rates costs across corporate estates.

Finance pressures were said to be mainly driven by agency staffing costs, particularly to deliver statutory functions and transformation programmes. Members also noted grant funding received for asylum support administration. An insurance overspend of £0.4m was reported, linked to reduced use of reserves to meet in?year costs. In contrast, Freedom Pass expenditure was forecast to be £1.0m below budget, reflecting revised GLA allocations based on lower relative usage and population factors.

Members raised concerns about the delivery and long?term sustainability of savings. It was explained that some savings had been delayed due to the time needed to put enabling activity in place, and that original assumptions had sometimes been affected by optimism bias. Officers highlighted the importance of robust challenge during budget setting and early identification where savings were no longer achievable.

Discussion focused on major cost pressures in children’s services, adult social care and homelessness. It was acknowledged that financial pressures were driven by both increased demand and rising unit costs. Officers outlined the importance of managing demand, reviewing need, supporting lower?cost provision and preventing escalation, while maintaining appropriate service standards.

Members requested improved transparency in future reports, particularly clearer explanations of why variances had occurred and whether movements were permanent, one?off or timing?related. Officers acknowledged this feedback.

Further clarification was provided on agency staffing costs, including the distinction between unbudgeted project roles, budgeted vacancies and longer?term posts that had since been built into future budgets. It was confirmed that permanent recruitment would help reduce overspends but would generally be treated as mitigation rather than the delivery of formal savings.

Members welcomed the increased stability of the financial forecasts and the improved clarity of explanations, while recognising the ongoing financial challenges facing the Council. In response to questions on savings delivery, it was clarified that savings described as “banked” had been achieved, with others assessed as on track, at risk or not deliverable. It was further noted that unrelated underspends were treated as mitigation and not counted as savings delivery.

In closing, Members welcomed the improved stability and clarity of reporting and thanked officers for their work.

RESOLVED: That the Committee:

1.    Noted the budget monitoring position as at January 2026 (Month 10) for the Council.

2.    Noted the budget monitoring position as at January 2026 (Month 10) for the services within the remit of the Corporate Resources and Infrastructure Select Committee.