Issue - meetings

Background:

This report provided the Cabinet with details of the Provisional Local Government Finance Settlement 2025 to 2026 announced by the Government on 18 December 2024.

The Provisional Settlement set out the referendum principles for 2025/26, which for Medway Council represented a core referendum threshold of 3% per year and as a local authority with social care responsibilities, the ability to set an Adult Social Care Precept of up to 2% per year without a referendum.

Medway’s Draft Budget assumed a 4.994% uplift, in line with the principles confirmed. The final tax base (the number of band D equivalent properties in the area) which determined the amount of Council Tax which could be budgeted for, would be agreed during January 2025 using a delegation of the Chief Operating Officer, in consultation with the Portfolio Holder for Finance and the Leader of the Council.

The report advised that as announced in the Autumn Budget, the small business rates multiplier would be frozen for 2025/26 at 49.9p while the standard business multiplier would rise by the CPI (Consumer Price Inflation) to 55.5p. Local authorities would be compensated for the loss of income arising from the decision to freeze the multiplier. Local authority baseline funding levels would rise by the increase on the standard business multiplier, weighted to the proportion of each local authority’s multiplier split.

The report also provided details of the impact on other grants, set out at sections 7.3 to 7.8 of the report.

Reasons:

The provisional levels of funding announced are a fundamental component of the 2025/26 budget, and their announcement is a further stage in the process to prepare a balanced budget for the coming financial year.