Within the context of developing the final budget proposals 2026/27 for recommending to Full Council on 17 February 2026, to seek Cabinet’s approval of a number of associated recommendations that include:

·      approval of the latest financial forecast / budget proposals and council tax amount for 2026/27;

·      agreement to a delegation to the Portfolio Holder for Corporate Finance and Governance to agree the detailed budget proposals and formal draft resolutions / ‘technical’ appendices required for Full Council on 17 February 2026; and

·      an acknowledgement of the Statutory Officers’ and Council’s obligations to a successor Unitary Council as part of the current LGR proposals, including those that are expected to emerge within legislation / associated structural orders along with the Council’s initial ‘in principle’ approach set out within the main body of this report.

RESOLVED that Cabinet –

a)       approves the updated financial forecast, as set out in Appendix A to report A.2, along with savings, cost pressures for 2025/26, 2026/27 and 2027/28, and the proposed transfers to / from the Corporate Investment Fund(s), as set out in Appendices B, C and D respectively that form the firm proposals for the 2026/27 budget and recommends to Council a Band D Council Tax for district services of £205.48 for 2026/27 (a 2.99% increase), along with the associated council tax requirement of £11.244m.

b)       authorises the Portfolio Holder for Corporate Finance and Governance, to agree the ‘technical’ appendices and resolutions associated with the budget proposals for recommending to Full Council on 17 February 2026;

c)       authorises the Chief Executive, in consultation with the Portfolio Holder for Corporate Finance and Governance, to report directly to Council in respect of the formal resolutions necessary to implement the Executive’s budget proposals including any further amendments emerging from additional information becoming available and/or notifications received from the Government;

d)       authorises the Portfolio Holder for Corporate Finance and Governance, to agree / adopt any necessary local business rate relief schemes for 2026/27, including where changes to reliefs may be necessary to reflect further Government decisions / announcements;

e)       notes the revocation of the Essex Business Rates Pool in 2026/27, due to the significant risks introduced by the Government’s Business Rates ‘Reset’ and decision-making timescales associated with the Local Government Finance Settlement; 

f)         in respect of the cost pressure of £0.300m in 2026/27 relating to the Investment in Assets (General R&R Priority Items), as set out within Appendix C, authorises the Chief Executive, in consultation with the Portfolio Holder for Corporate Finance and Governance to allocate this funding across the various associated schemes;

g)       in respect of the existing budget in 2025/26 that was identified to support the delivery of highlight priorities, agrees that £0.450m be set aside to provide the necessary additional resources to support the successful delivery of Local Government Reorganisation (LGR) activities and objectives, whilst safeguarding continuity of the Business as Usual (BAU) operations of the Council;

h)       in respect of g) above, agrees that the allocation of this funding be delegated to the Chief Executive to enable any associated recruitment / procurement activities to be undertaken; and

i)         acknowledges this Council’s and its Statutory Officers’ obligations to a successor Unitary Council as part of the current LGR proposals, including those that are expected to emerge within legislation / associated structural orders along with the Council’s proposed in-principle response as set out within the main body of the report (A.2).

Cabinet considered a report of the Corporate Finance & Governance Portfolio Holder (A.2) which, within the context of developing the final budget proposals 2026/27 for recommending to Full Council on 17 February 2026, sought Cabinet’s approval of several associated recommendations that included:

·      approval of the latest financial forecast / budget proposals and council tax amount for 2026/27;

·      agreement to a delegation to the Portfolio Holder for Corporate Finance and Governance to agree the detailed budget proposals and formal draft resolutions / ‘technical’ appendices required for Full Council on 17 February 2026; and

·      an acknowledgement of the Statutory Officers’ and this Council’s obligations to a successor Unitary Council as part of the current LGR proposals, including those that were expected to emerge within legislation / associated structural orders along with the Council’s initial in principle approach set out within the main body of the report.

It was reported that the financial position of Tendring District Council remained sound and the proposed budget assessed how the Council could successfully address future key cost pressures, with the budget proposals outlining a two-year approach which aligned with the revised key priorities to 2028, and along with associated business plans, they formed an holistic approach to a two-year window leading up to 1 April 2028 (the potential vesting day for the new Unitary Authority should Local Government Reorganisation (LGR) proceed on the Government’s current timetable for Greater Essex).

Cabinet was informed that the approach proposed, which included balancing the forecast risk fund and the Corporate Investment Funds, was aimed at providing the Council with the necessary flexibility to adequately address associated challenges and obligations over the next two years. The proposals set out within the report therefore in effect formed part of a series of activities / decisions over the next two years as part of the wider LGR framework.

Cabinet recalled that, at its meeting on 19 December 2025, it had considered the updated financial forecast, within the above context, which had acknowledged that there was an underlying and critical need to revisit / revise the Council’s financial plans and that Portfolio Holders and Officers would be undertaking a number of activities to enable the necessary detailed information and a two year financial plan (2026/27 and 2027/28) to be presented to Cabinet.

It had been recognised that such an approach would enable the Council to bring together a number of potential risks and opportunities that could be considered collectively and would place the Council in a strong position to support the continued protection of front line services, timely investment in priorities, alongside meeting any emerging statutory obligations relating to the incoming new Unitary Authority.

Members were made aware that the above included the identification of savings and responding to cost pressure and investment priorities. Although a significant amount of work had been completed to date, activities remained on-going that would culminate in final budget proposals being presented to Full Council in February 2026.

Notwithstanding the above, since the Cabinet’s meeting on 19 December 2025, additional changes to the forecast / budget had been made, primarily as a result of new or revised information becoming available, which included the impact of the Government’s provisional Local Government Financial Settlement announcements.

The appendices therefore reflected the most up to date position in terms of the forecast, savings, cost pressures and the use of one-off funding ‘pots’.  

Cabinet was advised that taking all the necessary changes into account, the estimated deficit for 2026/27 had increased to £0.995m (an increase of £0.338m compared to the position reported to Cabinet on 19 December 2025).This increase was primarily due to the inclusion of further cost pressures that had effectively been ‘charged’ against the Forecast Risk Fund via their inclusion in the underlying forecast. At the present time it was not proposed to make any corresponding adjustment against the Corporate Investment Funds, as a balance needed to be maintained between the two potential funding options as part of the two-year plan and to meet obligations emerging from LGR.

To enable the detailed estimates along with the various resolutions / ‘technical’ appendices required for Full Council in February to be finalised, a delegation to the Portfolio Holder for Corporate Finance and Governance had been included within the report’s recommendations. A further delegation had also been included to enable any potential changes to local business rate relief policies to be made in advance of bills being printed and sent out before the start of the next financial year. 

Cabinet was cognisant that the budget position set out in this report would change as further adjustments were required as part of finalising the budget for presenting to Full Council on 17 February 2026, with a further delegation included in the report’s recommendations to reflect this.

Cabinet was informed that, based on the final proposed budget for 2026/27, the Council’s own council tax requirement was £11.244m, which was based on a 2.99% (£5.96) increase for this Council’s services, with an annual Band D council tax of £205.48. Those figures were expected to remain unchanged and therefore would be reflected in the various budget resolutions / ‘technical’ appendices proposed to be delegated to the Portfolio Holder for Corporate Finance and Governance.

Members were reminded that the Council’s annual budget and the District and Parish elements of the council tax would be considered by Full Council on 17 February 2026 with approval of the ‘full’ council tax levy for the year 2026/27 being considered by the Human Resources and Council Tax Committee in March.

As set out in more detail within the main body of the report, given the uncertainty and risks emerging from the recent Government’s Business Rates ‘Reset’, the Essex Business Rates Pool would not be continuing in 2026/27 but would remain under consideration during the year to inform the decision for 2027/28.

It was felt that this report also provided a timely opportunity to respond to other matters arising during the year. With this in mind, it was proposed to seek approval to set aside £0.450m from an existing budget (that had been previously allocated to support the delivery of highlight priorities), to provide the necessary additional resources to support the successful delivery of Local Government Reorganisation (LGR) activities and objectives over the next two years.

A further delegation was also set out in the report’s recommendations that related to the further allocation of funding totalling £0.300m that had been included as a cost pressure within Appendix C (the investment in priority repairs to a number of Council’s building / assets.)

Members recognised that, as introduced as part of the report to Cabinet on 19 December 2025, a number of obligations would be placed on the Council and its Statutory Officers as part of the Government’s on-going Local Government Reorganisation reforms for Greater Essex. Although subject to further review over the year, an initial in-principal approach was being explored / developed, which was intended to form the basis of the Council’s reasonable and balanced financial response to LGR.

To set out the latest financial forecast as part of the process of developing the budget proposals for 2026/27 for recommending to Full Council in February 2026:-

It was moved by Councillor Stephenson, seconded by Councillor Barry and:-

RESOLVED that Cabinet –

a)       approves the updated financial forecast, as set out in Appendix A to report A.2, along with savings, cost pressures for 2025/26, 2026/27 and 2027/28, and the proposed transfers to / from the Corporate Investment Fund(s), as set out in Appendices B, C and D respectively that form the firm proposals for the 2026/27 budget and recommends to Council a Band D Council Tax for district services of £205.48 for 2026/27 (a 2.99% increase), along with the associated council tax requirement of £11.244m.

b)       authorises the Portfolio Holder for Corporate Finance and Governance, to agree the ‘technical’ appendices and resolutions associated with the budget proposals for recommending to Full Council on 17 February 2026;

c)       authorises the Chief Executive, in consultation with the Portfolio Holder for Corporate Finance and Governance, to report directly to Council in respect of the formal resolutions necessary to implement the Executive’s budget proposals including any further amendments emerging from additional information becoming available and/or notifications received from the Government;

d)       authorises the Portfolio Holder for Corporate Finance and Governance, to agree / adopt any necessary local business rate relief schemes for 2026/27, including where changes to reliefs may be necessary to reflect further Government decisions / announcements;

e)       notes the revocation of the Essex Business Rates Pool in 2026/27, due to the significant risks introduced by the Government’s Business Rates ‘Reset’ and decision-making timescales associated with the Local Government Finance Settlement; 

f)         in respect of the cost pressure of £0.300m in 2026/27 relating to the Investment in Assets (General R&R Priority Items), as set out within Appendix C, authorises the Chief Executive, in consultation with the Portfolio Holder for Corporate Finance and Governance to allocate this funding across the various associated schemes;

g)       in respect of the existing budget in 2025/26 that was identified to support the delivery of highlight priorities, agrees that £0.450m be set aside to provide the necessary additional resources to support the successful delivery of Local Government Reorganisation (LGR) activities and objectives, whilst safeguarding continuity of the Business as Usual (BAU) operations of the Council;

h)       in respect of g) above, agrees that the allocation of this funding be delegated to the Chief Executive to enable any associated recruitment / procurement activities to be undertaken; and

i)         acknowledges this Council’s and its Statutory Officers’ obligations to a successor Unitary Council as part of the current LGR proposals, including those that are expected to emerge within legislation / associated structural orders along with the Council’s proposed in-principle response as set out within the main body of the report (A.2).