Issue - meetings

To present the Council’s forecast 2025/26 financial position as at end of December 2025.
The report covers the following areas:
• Housing Revenue Account (HRA) Revenue Budget
• Housing Revenue Account (HRA) Capital Programme

Decision

That Cabinet noted the forecast 2025/2026 outturn position for the HRA Revenue and Capital budgets as at the end of December 2025.

Reasons for the decision

Members should be kept up to date regarding the financial position of the Authority. Effective budget management was critical to ensuring financial resources were targeted towards the Council’s priorities. Monitoring enabled early identification of variations against the plan and timely corrective action.

Other options considered and rejected

Cabinet should have oversight of Council budgets, therefore, the option of not producing a monitoring report was discounted.

Purpose of report

To present the Council’s forecast 2025/26 financial position as at the end of December 2025. The report covers the Housing Revenue Account (HRA) Revenue Budget and the Housing Revenue Account (HRA) Capital Programme.

Decision

That Cabinet noted the forecast 2025/2026 outturn position for the HRA Revenue and Capital budgets as at the end of December 2025.

Other options considered

Cabinet should have oversight of Council budgets, therefore, the option of not producing a monitoring report was discounted.

Reasons for the decision

Members should be kept up to date regarding the financial position of the Authority. Effective budget management was critical to ensuring financial resources were targeted towards the Council’s priorities. Monitoring enabled early identification of variations against the plan and timely corrective action.

The Leader of the Council presented the report.

The report outlined ongoing financial pressure on the HRA maintenance and repairs budgets, which was first highlighted in September 2025. Since then, an additional revenue budget of £2.7m had been put in place by Full Council in November 2025.

The pressures were continuing and being closely monitored. A number of actions had been taken in order to bring the situation back under control, the actions were set out within the report.

The actions have enabled previously projected overspend to be brought back in line with a reduced projected overspend of £91,000, forecast for the revenue repairs and maintenance budgets.

There were some variances across the HRA revenue budgets which were leading to an overall forecast overspend of £162,000, which included reduced investment income as a result of having to draw on the HRA reserves in year.

With regard to the Capital programme, the refurbishment and improvement programme, there were a number of slight variances as priorities for expenditure had been moved around. This has resulted in movements between schemes where works had been reprioritised, which could be seen in Appendix A.

Overall, there was a projected underspend of £1.1m which was being requested as a budget carry forward.

The other significant variance was on the new-build programme where the underspend of £8.5m would be carried over into 2026-27 as works progress on the new schemes for development.

One Member queried how much the Council received on the sale of Lumby’s Terrace, Stamford and how this compared with the cost of the replacement houses proposed in Stamford.

The information on Lumby’s Terrace, Stamford was commercially confidential as the transactions were still going through a process with Solicitors.

It was noted that projections for the HRA based on the current profile was reducing the reserves down to around £8m by 2028, this was an area of concern as without dealing with the financial challenge there would be no finances available to fund the capital programme after that point.

The Leader of the Council highlighted quarterly monitoring reports were brought to the Committee, four times a year. Cabinet was aware of the concern and would report back to the Committee in due course.

One Member thanked the Officers on works that had been undertaken on the much needed investment on the Earlesfield estate, Grantham.

It was hoped that clarity around the allocation on resources would be forthcoming prior to budget setting. The Deputy Chief Executive and S151 Officers main concern was the Capital Programme, it was felt prioritising certain works would be required as the HRA expenditure would not be sustainable in the near future.

It was highlighted that Councils who become part of a reorganised local government structure would still have their own HRA in the short-term following reorganisation.  

One Member felt the HRA was not sustainable and an action plan should be put into place to determine financial prioritisation from Cabinet.

The Leader of the Council confirmed Cabinet would review the situation on  ...  view the full minutes text for item 59