Agenda item

Report of the Corporate Director of Finance and Resources (S151 Officer). To be presented by the Cabinet Member for Finance & Corporate Services.

DECLARATIONS OF INTEREST MADE FOR THIS ITEM:

None

RESOLVED:

That Cabinet:

1.    Noted the content of the Section 25 Statement provided by the Corporate Director for Finance and Resources (Appendix 11).

2.    Considered the outcome of the budget consultation to be included in the report to Council (Appendix 3).

3.    Noted the content of the Cumulative Equality Impact Assessment for 2026/27 (Appendix 5).

4.    Approved the responses made to the Overview and Scrutiny Committee recommendations following their consideration of the draft budget proposals (Appendix 4).

5.    Proposed approval to the Council of the 2026/27 Budget and MTFS 2026/31 Budget, new budget requirements and savings proposals (Appendices 1 and 2 a–f).

6.    Proposed approval to the Council of the 2026/27 General Fund Revenue Budget as set out in Appendix 1, including specifically a General Fund budget requirement of £343.4m, but subject to final decisions of the levying and precepting bodies and the final local government finance Settlement.

7.    Proposed approval to the Council of the General Fund Medium Term Financial Strategy (MTFS) 2026/2031 (Appendix 1).

8.    Proposed approval to the Council that the overall Haringey element of Council Tax set by the London Borough of Haringey for 2026/27 would be £1,803.26 per Band D property, representing a 2.99% increase on the 2025/26 Haringey element and with an additional 2% for the Adult Social Care Precept amount.

9.    Noted the Council Tax Base of the London Borough of Haringey, as agreed by the Section 151 Officer under delegated authority (Article 4.01(b), Part 2, of the Constitution), as 80,924 for the financial year 2026/27 (Appendix 6).

10. Proposed approval to the Council of the General Fund Capital Programme 2026/27 to 2030/31 (Appendix 7).

11. Proposed approval to the Council of the strategy on the use of flexible capital receipts to facilitate the delivery of efficiency savings, including utilisation for redundancy costs (Appendix 8).

12. Noted the Capitalisation Policy (Appendix 9).

13. Noted the Treasury Management Strategy Statement for 2026/27 for approval by Council (Appendix 10).

14. Proposed approval to the Council of the 2026/27 Minimum Revenue Provision policy (Appendix 10, Annex C).

15. Proposed to the Council the Dedicated Schools Budget (DSB) allocations for 2026/27 of £149.8m as set out in Table 16 and paragraph 14.2.

16. Noted the funding distributed to primary and secondary schools for 2026/27 based on the figures advised to Schools Forum and submitted to the Department for Education (DfE) in January 2026, as set out in Section 14.

17. Noted the budgets (including the use of brought forward DSG) for the Schools Block, Central Services Block, High Needs Block and Early Years Block, as set out in Table 16.

18. Delegated to the Director of Children’s Services, following consultation with the Cabinet Member for Children, Education and Families, authority to amend the Delegated Schools Budget to take account of any changes to Haringey’s total schools funding allocation by the DfE.

19. Delegated to the Section 151 Officer, following consultation with the Cabinet Member for Finance and Corporate Services, authority to make further changes to the 2026/27 draft budget to Full Council.

Reasons for the decision:

The Council had a statutory obligation to set a balanced budget for 2026/27, and this report formed part of the budget-setting process for forecasting funding and expenditure for 2026/27, which would be presented to Full Council on 2 March 2026. As part of good financial management and transparency, the report also set out the funding and expenditure assumptions for the following four years in the form of an updated Medium-Term Financial Strategy (MTFS). The final budget for 2026/27, Council Tax levels, Capital Programme, Treasury Management Strategy Statement, Housing Revenue Account (HRA) budget and Business Plan were to be recommended to Full Council on 2 March 2026 following consideration at Cabinet on 10 February 2026.

Alternative options considered:

The Cabinet had to consider how to deliver a balanced 2026/27 budget and a sustainable MTFS over the five-year period 2026/2031, to be reviewed and adopted at the meeting of Full Council on 2 March 2026.

The Council developed the proposals contained in the report in light of its forecasts for future income levels and service demand. These took account of the Council’s priorities; the extent of the estimated funding shortfall; and the estimated impact of wider environmental factors such as inflation, interest rates, household incomes and, in some service areas, the legacy of the Covid?19 pandemic.

The Cabinet Member for Finance and Corporate Services introduced the report.

The Cabinet Member explained that the budget proposed in the report represented a high level of investment in Haringey. It allocated £343.4m to providing services that residents used and relied on, and to maintaining public spaces and communities to be clean and safe. The Council aimed to create a borough where everyone could belong and thrive, and, despite financial pressures, it directed resources to areas identified as priorities.

It was noted that the budget included:

• £222.9m for adults’ and children’s social care, supporting residents who required assistance.
• £42.9m for preventing and addressing homelessness, including ending the use of B&Bs as temporary accommodation for families.
• £4.7m for the maintenance of parks and green spaces (revenue and capital).
• £2.3m for libraries.
• £34.4m to support lower?income residents with council tax costs.
• £283m for building new council homes and £93m for renovating existing council homes and estates.
• £37.8m for recycling and waste services.
• £16.1m for concessionary fares.
  
  

The Cabinet Member stressed that these decisions resulted from financial constraints and the need to prioritise. Due to reduced government funding over several years, in 2025/26 the council operated with approximately £143m less in real terms in core funding than in 2010/11, a 55% reduction. At the same time, demand for local services increased, and inflation raised the cost of providing them. Haringey Council had been under?resourced relative to the needs of its communities. Historically, it had 15% less to spend per resident than neighbouring boroughs, despite higher levels of deprivation in some groups. The government’s decision to amend the funding formula to account for deprivation, including housing costs, resulted in Haringey receiving an additional £18.4m over three years, with £9.5m allocated in 2026/27.

It was noted that, although this additional funding was welcomed by the Council, it did not fully address the cumulative financial pressures. Despite ongoing efficiency measures, spending reductions and increased income, the council anticipated continued reliance on Exceptional Financial Support (EFS) to balance the budget in 2026/27 and in the medium term. EFS was borrowing permitted by government to fill the funding gap and would need to be repaid with interest.

It was explained that the draft budget for 2026/27 included £23.2m in savings proposals, consisting of £14.9m previously approved and £8.3m in new proposals, some of which had been subject to consultation with residents and businesses. The council intended to focus on achieving these savings, alongside delivering £30m of savings in the 2025/26 budget, to reduce the need for Exceptional Financial Support. Despite the financial challenges, the budget reflected the council’s priorities, including maintaining core public services and investing in local parks, leisure centres and libraries. Although significant work remained, the Council aimed to improve local public services and infrastructure and move away from the prolonged period of financial constraint that had affected service provision.

Councillor Connor provided the Cabinet an outline of the scrutiny recommendations to Cabinet on the budget:

• That Scrutiny had noted concerns regarding the scale of borrowing in the Council and the associated risks that came with this approach.
  
  
• It was noted that there was concern regarding the ability of the Council to reduce reliance on Exceptional Financial Support in the future.
  
  
• It was noted that Scrutiny had asked for future improved transparency of the budget process to ensure better risk management and involvement by Scrutiny.
  
  

The Cabinet Member made the following points in response:

• It was stressed that the Cabinet would always look to improve and support the process of budget scrutiny.

Following questions from Councillor Das Neves and Connor, the following information was shared:

• It was explained that the government funding settlement that had been provided had been more substantive than was expected, and that this was welcomed to help meet challenges. Officers explained that final funding settlement had been shared on 9 February 2026. It was explained that there was £17.2 million for 2026/27, which was a £5.2 million increase in grant funding from the previous year. It was noted that there had been, as a result, a reduction in requirement for Exceptional Financial Support.
  
  
• It was noted that the Cabinet were aware of the risks of continuing with an unsustainable budget. It was explained that the budget was reflective of the position, but stressed that the Council would look at ways of reducing the budget gap as well as working with government to ask for additional support for local authorities.
  
  
• It was stressed that the Cabinet Member for Finance and Corporate Services would not make performative cuts and risk any reduction in service quality.
  
  
• It was explained that the Council was constantly reviewing the Capital Programme to ensure best value for money and good delivery.

RESOLVED:

That Cabinet:

1.    Noted the content of the Section 25 Statement provided by the Corporate Director for Finance and Resources (Appendix 11).

2.    Considered the outcome of the budget consultation to be included in the report to Council (Appendix 3).

3.    Noted the content of the Cumulative Equality Impact Assessment for 2026/27 (Appendix 5).

4.    Approved the responses made to the Overview and Scrutiny Committee recommendations following their consideration of the draft budget proposals (Appendix 4).

5.    Proposed approval to the Council of the 2026/27 Budget and MTFS 2026/31 Budget, new budget requirements and savings proposals (Appendices 1 and 2 a–f).

6.    Proposed approval to the Council of the 2026/27 General Fund Revenue Budget as set out in Appendix 1, including specifically a General Fund budget requirement of £343.4m, but subject to final decisions of the levying and precepting bodies and the final local government finance Settlement.

7.    Proposed approval to the Council of the General Fund Medium Term Financial Strategy (MTFS) 2026/2031 (Appendix 1).

8.    Proposed approval to the Council that the overall Haringey element of Council Tax set by the London Borough of Haringey for 2026/27 would be £1,803.26 per Band D property, representing a 2.99% increase on the 2025/26 Haringey element and with an additional 2% for the Adult Social Care Precept amount.

9.    Noted the Council Tax Base of the London Borough of Haringey, as agreed by the Section 151 Officer under delegated authority (Article 4.01(b), Part 2, of the Constitution), as 80,924 for the financial year 2026/27 (Appendix 6).

10. Proposed approval to the Council of the General Fund Capital Programme 2026/27 to 2030/31 (Appendix 7).

11. Proposed approval to the Council of the strategy on the use of flexible capital receipts to facilitate the delivery of efficiency savings, including utilisation for redundancy costs (Appendix 8).

12. Noted the Capitalisation Policy (Appendix 9).

13. Noted the Treasury Management Strategy Statement for 2026/27 for approval by Council (Appendix 10).

14. Proposed approval to the Council of the 2026/27 Minimum Revenue Provision policy (Appendix 10, Annex C).

15. Proposed to the Council the Dedicated Schools Budget (DSB) allocations for 2026/27 of £149.8m as set out in Table 16 and paragraph 14.2.

16. Noted the funding distributed to primary and secondary schools for 2026/27 based on the figures advised to Schools Forum and submitted to the Department for Education (DfE) in January 2026, as set out in Section 14.

17. Noted the budgets (including the use of brought forward DSG) for the Schools Block, Central Services Block, High Needs Block and Early Years Block, as set out in Table 16.

18. Delegated to the Director of Children’s Services, following consultation with the Cabinet Member for Children, Education and Families, authority to amend the Delegated Schools Budget to take account of any changes to Haringey’s total schools funding allocation by the DfE.

19. Delegated to the Section 151 Officer, following consultation with the Cabinet Member for Finance and Corporate Services, authority to make further changes to the 2026/27 draft budget to Full Council.

Reasons for the decision:

The Council had a statutory obligation to set a balanced budget for 2026/27, and this report formed part of the budget-setting process for forecasting funding and expenditure for 2026/27, which would be presented to Full Council on 2 March 2026. As part of good financial management and transparency, the report also set out the funding and expenditure assumptions for the following four years in the form of an updated Medium-Term Financial Strategy (MTFS). The final budget for 2026/27, Council Tax levels, Capital Programme, Treasury Management Strategy Statement, Housing Revenue Account (HRA) budget and Business Plan were to be recommended to Full Council on 2 March 2026 following consideration at Cabinet on 10 February 2026.

Alternative options considered:

The Cabinet had to consider how to deliver a balanced 2026/27 budget and a sustainable MTFS over the five-year period 2026/2031, to be reviewed and adopted at the meeting of Full Council on 2 March 2026.

The Council developed the proposals contained in the report in light of its forecasts for future income levels and service demand. These took account of the Council’s priorities; the extent of the estimated funding shortfall; and the estimated impact of wider environmental factors such as inflation, interest rates, household incomes and, in some service areas, the legacy of the Covid?19 pandemic.