David Thomas: Budget plans aim to secure Torbay’s long-term stability

This week the council will set its budget for the coming year, 2026/27. It is never an easy task. 

The cost of delivering services continues to rise,  something many of you will recognise from managing your own household  budgets, and the council faces the same pressures. 

In recent years, government funding has been provided on a yearly basis  and often confirmed shortly before Christmas. 

This has made long term  planning extremely difficult. This year, however, the government introduced  a new fairer funding formula alongside a three-year settlement. In  principle this is a positive step. Knowing what funding will be available  over several years allows councils to plan more responsibly and manage  finances with greater certainty. 

The revised formula was intended to provide greater support to areas  experiencing higher levels of deprivation. As Torbay falls within one of the  highest categories, I expected we would receive a fair settlement.  Unfortunately, that has not proved to be the case. 

While the first-year settlement is broadly manageable, the figures for  years two and three present a significant challenge. 

As originally drafted,  they indicated a funding gap of around £20 million across those two years,  a position that would inevitably point towards major change or reductions  in services. 

Throughout January we met with ministers, our MPs and government officials to explain why we believed the figures did not  accurately reflect Torbay’s needs. Although the government has since  revised the settlement and provided some additional funding, we still face  very difficult decisions in years two and three. 

When we took office in 2023, we set out a clear approach based on strong  financial management, long term sustainability and budgets that would  be built around the needs of our community. That remains our focus.  

This year we are taking decisions with the full three-year settlement in  mind, acting now in ways that will help protect services and strengthen  our financial position for the longer term. 

For 2026/27 cabinet is proposing a balanced net revenue budget of  £205.334 million and a capital investment plan of £126.865 million  through to 2028/29. 

The revenue budget funds the day-to-day services  people rely on, including support for older residents, safeguarding  children, supporting schools and special educational needs services, managing housing needs,  collecting waste and recycling, maintaining street lighting, environmental  health and community safety.

As previously mentioned, the cost of providing these essential services  continues to rise. 

To protect them, we are proposing to set council tax  at the level required by the government, which would mean an increase of  4.99 per cent. I understand this is slightly higher than the increase we had hoped  to set, which was 4.75 per cent. However, the government has made clear that if  councils do not take the full increase available, future funding settlements  could be affected. 

Our capital investment budget supports longer term projects such as  building new homes and delivering regeneration across the Bay. These  investments support local jobs, strengthen our economy and help create  vibrant communities. 

Residents have told us clearly that strong services,  job opportunities and continued investment in Torbay’s towns are  essential to building a stronger future. 

We are also taking steps to strengthen the council’s financial resilience.  One off government funding received this year will help ease future  pressures and reduce the scale of savings needed later. 

This includes  creating reserves to support transformation in adult social care and across  the council, helping to protect the services residents rely on most. 

The government has announced that it will fund 90 per cent of the SEND overspend  next year. However, councils will be required to meet the remaining 10 per cent. In Torbay’s case this represents £1.7 million. We will therefore take the  prudent decision to create a reserve this year so that we are able to meet  that cost next year. 

In addition, £400,000 will be allocated to transformation work to help  reduce future spending, and we will create a new adult social care reserve  of £730,000 to support longer term funding solutions. 

Through Operation Brighter Bay we will focus existing resources on visible  improvements in residential areas, including parks, green spaces and  shared community spaces. These are the places people use every day,  and improving them will help our towns feel cleaner, safer and more  welcoming for everyone. 

The budget proposals were discussed at cabinet on February 17 and  final recommendations will be considered by the full council on February 26,  when councillors will also agree council tax levels for the year ahead.

These meetings are live streamed on our YouTube channel and can be  watched back at any time. I encourage you to stay informed and stay  involved as we continue working together for the future of our Bay.