Agenda item

To consider the report on the Third Financial Review of 2025-26.

The committee considered a report on the Third Financial Review (FR3) for 2025/26, based on financial information as at the end of November 2025. The report formed part of the Council’s annual financial monitoring cycle and had previously been reported to the Finance Sub-Committee on 30 January 2026.

The committee was advised that:

• The overall Council revenue position was forecasting a balanced outturn at 31 March 2026, representing an improvement of £2.3m since FR2.
• The Place Directorate was forecasting an underspend of £7.4m, an improvement of £1.9m since FR2.
• The budget areas within the remit of the Committee were forecasting an underspend of approximately £0.9m, an improvement of £0.9m since FR2.
• A further financial review (FR4) had been undertaken and improvements to the 2025/26 forecasts were anticipated.

Members noted that a significant element of the underspend was attributable to timing delays rather than service reductions, particularly a forecast £1m underspend relating to supported bus and demand-responsive transport, due to procurement and implementation delays.

The committee considered updates to the capital programme, including variations since budget approval and proposals for supplementary capital estimates. Officers reported that Table 7 in the report sought approval for an increase in the capital programme for Nantwich Town Centre Public Realm Improvements.

Officers committed to providing a written response detailing the timescales for the Nantwich Town Centre Public Realm Improvements programme, and detail around the initial project scoping work being undertaken to understand the scale, complexity, and resourcing needs associated with advertising income.

Members also considered information on earmarked reserves, capital scheme delivery timescales, Section 106 funding arrangements, and the meaning of projects described as “mothballed”, which officers confirmed referred to schemes temporarily paused pending identification of further funding.

During discussion, members raised questions regarding:

• The treatment of underspends within the Council’s overall financial position.
• Parking income forecasts and implementation of staff and member parking charges.
• Bus service delivery, FlexiLink staffing, and procurement timescales.
• Public perceptions of underspend in relation to highway condition and maintenance.

Officers confirmed that:

• Forecast underspends contributed to the corporate MTFS and could not be retained by individual committees.
• Financial monitoring reports reflected a snapshot in time, with figures subject to change later in the year.
• “Mothballed” projects may proceed if additional funding is secured.

RESOLVED: (By Majority)

That the Highways and Transport Committee

1. Note the overall Council’s Financial position as described within the Executive Summary – Council Financial Position.

2. scrutinised the latest revenue forecast for Highways and Transport Directorate, reviewed progress on the delivery of the MTFS approved budget policy change items (Table 3), the RAG ratings and understood the actions to be taken to address any adverse variances from the approved budget.

3. Note the overall in-year forecast capital spending for Highways and Transport Directorate of £66.999m against a revised MTFS budget of £66.626m in Tables 4 and 5 of the report.

4. Note the Delegated Decisions made for Supplementary Capital estimates up to £500,000 as per Table 6 of the report.

5. Approve the Supplementary Capital Estimate above £500,000 up to and including £1,000,000 as per Table 7 of the report.

6. Note the Supplementary Capital Virements above £500,000 up to and including £5,000,000 to be approved by relevant member(s) of CLT and Chief Finance Officer in consultation with Chair of the Highways and Transport committee and the Chair of Finance Sub Committee as per Table 8 of the report.

7. Note the Supplementary Capital Estimates (SCEs) and Capital Virements above £5,000,000 approved by Full Council asper Table 9 of the report.

8. Note the Capital Budget Reductions asper Table 10 of the report.

9. Note the available reserves position as per Table 11 of the report.