The Medium Term Financial Strategy supports the Bexley Plan approved by Council on 2 November 2022, ‘Making Bexley Even Better: Our Bexley Plan 2022/26’ and sets out three core priorities:

1. aspiration for our residents
2. ambition for our borough
3. an efficient and effective council

The aim is to make Bexley even better by 2026, by supporting residents to live the best lives possible and to reach their potential. We will secure investment in the borough so that current and future generations and communities live in a thriving place, and we will run an efficient and effective Council to make the most of our resources and make a difference to residents' lives.

The refresh of the Bexley Plan took place at a time of financial uncertainty which makes it difficult to plan ahead. The Bexley 2050 vision has engaged residents, businesses and community groups creating a strategic vision for the Borough. The key objectives are:

• supporting residents - This includes a focus on improving the quality of life for all residents, ensuring they have opportunities to reach their full potential, and creating thriving communities
• securing investment - The plan aims to attract investment that will benefit the borough, creating jobs and fostering economic growth
• being fair and inclusive - This objective emphasizes creating a borough that is equitable and accessible to all, regardless of background or circumstances
• being careful with resources - The plan prioritizes efficiency and effectiveness in the use of council resources, focusing on delivering value for money
• preserving neighbourhoods and values - The plan seeks to maintain the unique character of Bexley's neighbourhoods while accommodating growth and development

The Medium Term Financial Strategy forms a key part of how the Council prioritises its expenditure to support the achievement of the objectives included in the Bexley Plan.

To improve its planning process, the Council has, last year, started to implement a medium term approach to business planning. This will bring together financial information, in the form of the Council’s Medium Term Financial Strategy with the high-level directorate business planning over a five-year period. This was reported to Public Cabinet in April 2025.

The Medium Term Financial Strategy presented to Public Cabinet on 24 February 2025 assumed the Council’s general fund budget gap will be £32.658m in 2026/27 increasing to £43.893m in 2028/29 where the total budget requirement is estimated at £295.363m.  This is summarised in the table below:

Estimated Budget Requirement and Budget Gap as at February 2025

Rolling forward a further year to include 2029/30 has increased the potential gap by £2.949m increasing the gap to £46.842m. The updated budget since the report to Public Cabinet in February 2025 is shown in the table below:

Updated budget gap to include 2029/30 financial year

If the future Local Government Finance Settlement provides  for social care grants to continue throughout the medium term and permits for Council Tax to be levied  at 2025/26 levels of 4.99% (as confirmed in the Spending Review), this would significantly reduce the budget gap in 2026/27 onwards, to £11.794m in 2026/27, £15.977m in 2027/28, £19.576m in 2028/29 and £20.819m in 2029/30.

The budget gap across each of the years will be subject to further change as more certainty is provided as future funding announcements are made and planning assumptions updated. Funding announcements are awaited for 2026/27. It is not unusual that at this stage of the financial planning process, for the Council to have gaps in future years, especially given the level of economic uncertainty.

The following assumptions are used within the Medium Term Financial Strategy as set out in Appendix A. These are:

• that Council will agree an increase of 1.99% on Council Tax and 2.00% for Adult Social Care Precept for 2026/27. Note that the current level before a public referendum is required is 4.99%. This will be a Member’s decision at Budget Council in March of each year
• grant income as set out in Appendix A will be received as anticipated
• the financial growth assumptions outlined in the MTFS is sufficient to meet the increased demographic and inflation growth increases over the medium term
• levies to external bodies will continue to be met from the Council’s budget requirement

Options to close the gap

The Council is deploying a number of approaches, with detailed options  being worked up during the coming months aimed at closing the budget gap.  These will include:

• Transformation programme  - Work is underway across a number of transformations workstreams,  Children’s Services, Customer Experience, Commercial, Culture, and Corporate Core that aim to generate significant savings for 2026/27 This is the primary approach being deployed to close the budget gap for 2026/27 and future years
• Service reviews – To supplement the Transformation programme the Council will undertake a series of comprehensive service reviews for all those functions that have not been primarily impacted through one or multiple of the 5 transformation programmes. The focus for the service reviews will primarily be in the efficiency space but as good practice sets out, will also focus on the economy and effectiveness of service delivery
• Technical accounting reviews. – the Council will undertake a number of technical reviews predominantly within the area of Corporate Finance that will look to cost options for savings, such reviews will include the Collection Fund, Pension Fund, Insurance Fund and Treasury Management budgets
• Reserve reviews – A comprehensive review has taken place to consider the forecast use of reserves to ensure the council retains a prudent level of reserves over the medium term and a further review will take place within the 2025/26 financial year. Officers will continue to keep all planning assumptions which have been made to support the Medium Term Financial Strategy under review and a further update will be provide to Public Cabinet in late 2025