Rushmoor Borough Council’s Cabinet will be asked next week to recommend a budget that will help to secure its financial stability.
The Cabinet will hear on Tuesday 11 February that the council’s financial recovery plan, adopted last year and backed by an independent review, has already delivered nearly £750,000 in savings of which £338,000 are ongoing, and a significant amount of progress has been made in identifying more savings for the coming year.
Further savings will be made following a review of the council’s senior management structure, which will include the deletion of the post of Chief Executive this spring, as approved by a full council meeting on Wednesday (5). This will save nearly £180,000 a year. An interim Head of Paid Service, a required post, will be appointed at a lower grade to oversee the running of the council and make recommendations on a long-term structure.
The recovery plan recognised a target for the council to sell £40 million of its assets, such as land and industrial units, to help address rising costs from increased interest rates, now close to 5%, on its £170 million short-term borrowing.
The Cabinet will be told that over the next year, the council will reduce its debts by £12 million from asset sales.
In terms of savings, the Cabinet will hear that for the coming financial year, the council needs to save £2.8 million through cost reductions and efficiencies, rising to £3.8 million by 2027/28, if it is to remain financially stable. The savings required have increased from the earlier targets because of a shortfall in the sale of assets, interest rate rises and a revised view of income from property investments.
For 2025/26, it will use £1 million of its reserves to offset the impact of these savings on services, taking the total use of reserves in the year to £3.4m, leaving £4.2m in reserve for future years.
The latest financial position, which forms part of the council’s medium term financial strategy, will be considered by the Cabinet on 11 February, when it will also be asked to recommend the council tax rate for the coming year. Final approval for this lies with the full council, which is due to meet on 27 February.
Councillor Gareth Williams, Leader of Rushmoor Borough Council, said: “We said we would be open and honest about the council’s financial position that we inherited last year, and we continue to be so.
“The latest position shows that we are making progress against the financial recovery plan, although our high level of short-term debt continues to constrain the council’s financial position. Our strategy is to reduce debt through asset sales and to look for further efficiency savings in the council’s operations in order to protect key services.
“We have also strengthened governance to ensure all decisions are given rigorous scrutiny and do not take risks with the council’s financial future, including oversight by a Financial Recovery Group. A further review of the council’s system of scrutiny and governance will report shortly.”
Overall, the cost of running the council, including delivering key services and priorities and meeting its loan requirements, will be around £32million.
In keeping with previous years, the council is proposing to increase its share of the council tax, which will contribute £8 million towards services, by 2.99% or just under £7 a year for an average Band D property.
This is separate from any increase that Hampshire County Council, the police or fire authorities choose to introduce. Of the council tax bill, nearly three-quarters goes to Hampshire, 12% goes to the police and four per cent to the fire and rescue authority. Rushmoor Borough Council keeps approximately 11p in every pound to help pay for local services.
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