Council awaits grant funding information from government as it begins budget setting process for 2025/26
Oxfordshire County Council and fellow local authorities across England are waiting to hear how new funding for local government pledged by the chancellor at the end of October will translate into grant funding levels for the 2025/26 financial year.
On 30 October, Chancellor of the Exchequer, Rachel Reeves, made announcements during her autumn statement that referenced the financial challenges that have been experienced across local government over a number of years. Earlier that month, Oxfordshire County Council’s cabinet received an early budget report saying the authority has a £13.9 million shortfall for 2025/26.
The first draft of the council’s budget for 2025/26 contains £14.1m of money to meet financial pressures, £5.4m of new investments and £17.9m of savings. Meanwhile the council awaits news of what the limit will be on council tax rises for 2025/26.
Funding will not be known until December when the government will issue the draft financial settlement for local government with specific detail for individual councils. Further financial information will then be received as winter progresses. A budget is finally set in February.
Councillor Dan Levy, Oxfordshire County Council’s Cabinet Member for Finance, said: “Following years of underinvestment in local government, we welcomed the chancellor's announcement in October relating to extra funding nationally for local government in 2025/26.
“While this looks likely to address some shorter-term challenges that councils are facing, it's important not to underestimate the scale of the public sector’s financial issues. Rising costs and ever-increasing demand means that current and future challenges very much remain, especially in children’s services and adult social care.
“We need to see exactly how the broad information given by the chancellor in October will translate into specific detail for Oxfordshire County Council and we won’t begin to discover that until well into December.
“We also wait to see what the government will do to tackle the financial predicament of local government looking ahead to future years. A longer-term view needs to be taken with multi-year financial settlements being a part of that. We would also want to see councils in all parts of the country being treated equally.
“Our track record of responsible financial management means that Oxfordshire County Council is in a more resilient and robust position than many other authorities. However, the general position remains challenging.”
A public consultation on the substance of the 2025/26 budget proposals is now live and will run until 2 January 2025 on the council’s consultation and digital engagement platform Let’s talk Oxfordshire. People can comment on the council’s proposed budget with feedback captured using an online form or in writing by Freepost.
The consultation follows extensive engagement with residents over the summer on their priorities, including on the budget. This was through the council’s annual residents’ survey and participatory engagement opportunities using an online budget simulator, focus groups and sounding boards for children and young people. The feedback from this engagement was included in the budget and business planning report to cabinet on 15 October 2024.