A draft budget for 2026/27 and a three-year financial strategy which show a balanced budget position up to 2029 will be considered by Cabinet next week.
Cabinet’s consideration of the budget follows a Joint Meeting of Scrutiny last Thursday (29 January) where members asked questions on a number of areas including the council tax support scheme, highways resurfacing, investment in libraries, leisure and disability reablement provision. Members also said it was refreshing to see a balanced budget after more than a decade of needing to make significant savings.
The 26/27 budget and Medium-Term Financial Strategy sets out the positive impact that the Government’s Fairer Funding review will have on the council in future years, with balanced budget positions in each of the next three financial years.
However, as changes to funding allocations are being phased in over a three-year period, members are advised that risks and challenges remain in 2026/27. For example, demand for services in areas such as children and adult social care and housing needs continues to rise. As a result, we have factored in an additional £6m in 2026/27 to meet service demand.
Reserves balances also remain much lower than required with the forecast £6m overspend in the current financial year needing to be met by reserves.
To improve our reserves position, a request has been made to Government for Exceptional Financial Support (EFS) which is a form of financial flexibility for local authorities that are facing financial difficulties.
The report also recommends a council tax increase of 4.99% (2.99% general Council Tax and 2.0% Adult Social Care precept). This equates to an increase of £1.68 a week for a Band D property. We continue to charge one of the lowest rates of council tax in the country, around £200 less each year than some of our neighbouring councils.
We also offer a Council Tax Support Scheme to support those on a low income to pay their Council Tax.
Councillor Shabina Qayyum, Leader of Peterborough City Council, said: “Years of underfunding have had a significant impact on the financial standing of the authority, and more fundamentally, the services we deliver to our residents.
“The announcement made in December confirmed that we will receive one of the largest increases in our core funding across English councils and will allow us to move forward on a more stable footing.
“As our Scrutiny members pointed out last week, this is the first budget in more than a decade that we have been able to present a balanced budget without swingeing cuts to services whilst also proposing investment in key areas such as the replacement swimming pool for the city, children and adult social care and support for those who are struggling financially.
“It is crucial that we build back our financial resilience as a priority, and we have plans in place to do so. Over the medium term we will put money back into our reserves and invest in services, particularly where demand is the highest, with a firm focus on improving outcomes and the lives of residents.”
The budget includes investment in a number of areas including:
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Additional investment in social workers as a result of an increase in the number of looked after children and to support the Children’s Services improvement programme.
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Investment in AI and digital to make services more accessible for the public and also more efficient.
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Investment in additional educational psychologists, strengthening support for children with special educational needs and disabilities.
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Investment in communities through the new Crisis and Resilience Fund (CRF) which launches 1 April 2026 to provide joined-up crisis support for those who need it most and helping people to become financially stable.
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Investment in the Families First programme which looks to support families earlier, involve residents in decision making and keep families together.
Councillor Mohammed Jamil, Cabinet Member for Finance and Corporate Governance, said: “Fairer Funding allows us to now move ahead with our plans to reset by strengthening the foundations of our budget, rebuild by increasing reserves and investing in services, and redesign by developing new opportunities to deliver long term sustainable service solutions.
“With this approach we can move at pace towards our goal of achieving financial sustainability, investing in services that matter the most to our residents and supporting the most vulnerable. These priorities are all set out in our updated corporate strategy, which will also go before members for approval, and includes investment in a new swimming pool and leisure centre, a focus on supporting people in crisis and to reduce poverty, and delivering a plan to enhance our city centre so it is safe and vibrant, day and night.”
The Cabinet meeting will take place on Tuesday 10 February at 4pm where members will be asked to recommend the budget reports for approval to Full Council. Full Council will be asked to rubber stamp the budget and Medium Term Financial Strategy on Wednesday 25 February.
Agenda for the Cabinet meeting.