Issue - meetings

Report of the Director of Finance and Resources

Cabinet considered a report of the Director of Finance and Resources (Section 151 Officer), which would also be considered at the meeting of Council on 24th February 2026, that followed on from the Pre-Budget Report approved by Cabinet on 16th December 2025 (minute 44/25 referred) which has since been subject to a period of public consultation. The proposals within the report now formed the basis of the Council's final revenue and capital budget for 2026/27 incorporating the following details:

•  Gross budgeted spend of £1,035.3m (£73.5m higher than 2025/26).

•  Net budgeted spend of £422.9m (£126.0m higher than 2025/26) funded from Council Tax, Business Rates and Business Rates top-up of £56.5m due to the 2026/27 impact of the Fair funding redistribution.

•  A Council Tax Requirement of £199.9m (£10.4m or 6% higher than 2025/26), reflecting a City Council Tax increase of 3.95% detailed in the separate Council Tax Setting report on today’s agenda.

•  A number of new expenditure pressures, policy investments and technical savings proposals.

•  A Capital Strategy including a Capital Programme of £165.9m including expenditure funded by Prudential Borrowing of £33.9m.

•  An updated Treasury Management Strategy, Capital Strategy, and a Commercial Investments Strategy.

•  Amendments to the Council Tax Support Scheme.

The financial position in this Budget Report was based on the Final 2026/27 Local Government Finance Settlement published on 9th February 2026. This settlement was a result of the implementation of the Fair Funding systems, Council Tax equalisation and Business Rates reset. This settlement included a multi (three) year settlement which took the Authority through to the end of the current CSR (comprehensive spending review) period of March 2029.

This 3-year settlement enabled a much better medium-term view of the Council’s finances from a resource perspective. The Government would reserve the right to review allocations each year, but indicative allocations would allow Councils to plan more effectively.  Demographic pressures were still expected to continue to increase as cost-of-living issues continued to affect individuals’ experience and expectations of when local authorities and Government would intervene to protect them. The next 3 years would continue therefore to create a very challenging environment in which the City Council would need to ensure Government funding together with local taxation decisions were sufficient to cover existing cost and emerging pressures including inflation.

In response the additional resources received by Coventry in the Final settlement and in conjunction with the consultation responses, final proposals within the Budget Report proposed a Council Tax increase of 3.95%. This incorporated a 2.95% Council Tax increase plus a further 1% Adult Social Care (ASC) Precept. The precept was to enable councils including Coventry to manage increases in the costs of care. In total, the rise in Council Tax bills would be the equivalent of around £1.48 a week for a typical Coventry household including the expected rises in the precepts for Police and Fire.

At the point of the pre-budget stage, reported to Cabinet in December 2025, the 2026/27 settlement and the impact of the  ...  view the full minutes text for item 68