The Committee considered a report setting out an overview of the Council’s financial and performance position as at the end of Quarter 2 of the 2025/26 financial year. The report included updates on the General Fund Revenue and Capital budgets, the Housing Revenue Account (HRA), savings delivery, debt performance, and progress against the Corporate Plan performance measures and projects. The following documents were attached to the report:

·         Appendix 1 - Summary of the General Fund Budget and Forecast 2025/26

·         Appendix 2 - Savings Tracker Quarter 2

·         Appendix 3 - General Fund Capital Programme

·         Appendix 4 - HRA Capital Programme

·         Appendix 5 - Council Plan Performance Measures Quarter 2

·         Appendix 6 - Council Plan Projects Quarter 2

The report stated that the forecast General Fund revenue outturn position for Quarter 2 was an adverse net variance of £3.968m, a net improvement of £0.212m from the Quarter 1 position reported to the Committee at its meeting held on 17 September 2025 (Minute 26 refers).  The major cost pressures were summarised.  The report also provided an update on savings delivery, noting that £3.975m (34%) of savings had been delivered, £3.663m (32%) were on track, £2.143m (19%) were categorised as non-deliverable, and £1.735m (15%) were at risk.

The report recommended further adjustments to the General Fund Capital Programme, which was set out in Appendix 3, that would result in a revised approved budget of £76.754m for 2025/26.  Against this proposed revised budget, the current forecast was a positive net variance of £0.211m relating to the Delivery Fund.

The report noted that the approved HRA budget assumed a drawdown from HRA reserves of £5.047m. At Quarter 2, the forecast revenue outturn position on the HRA was an adverse net variance to budget of £0.197m, a net increase of £0.021m from Quarter 1. Therefore, a drawdown from the HRA Reserve was forecast of £5.244m. The report proposed adjustments to the HRA Capital Programme, set out in Appendix 4, that would result in a revised approved budget of £64.483m for 2025/26.  At Quarter 2, the HRA Capital Programme was forecasting to spend to budget against this proposed revised budget.

The report also set out performance against the Council Plan success measures.  Of the 17 Council Plan Performance Measures monitored monthly or quarterly, 47% were currently at or above target (green), 24% were within 10% of the target (amber), 24% were 10% or more off target (red) and 5% (1 measure) could not be reported for Quarter 2 but would be updated for Quarter 3.  Of the 51 Council Plan Projects, 2% were currently delivered (blue), 63% were on track (green), 31% were at risk (amber) and 4% were off track (red).  The full list of Performance Measures was attached to the report at Appendix 5 and Projects at Appendix 6.

Resolved –

(1)       That it be noted that:

(a)       The forecast General Fund revenue outturn position for Quarter 2 was an adverse net variance of £3.968m (as set out in Appendix 1);

(b)       £3.975m (34%) of savings had been delivered (blue) and £3.663m (32%) of savings were on track to be delivered (green) by March 2026. £2.143m (19%) of savings were currently categorised as non-deliverable (red) and £1.735m (15%) categorised as at risk of delivery (amber) (as set out in Appendix 2);

(c)       The General Fund Capital Programme was forecasting a positive net variance of £0.211m against the proposed revised budget of £76.754m (as set out in Appendix 3);

(d)       There was a total £2.927m Delivery Fund available for 2025/26 (inclusive of 2024/25 approved carry forwards), and at Quarter 2 £2.801m of this funding had been allocated out to approved schemes;

(e)       The Housing Revenue Account (HRA) was projecting an adverse net variance of £0.197m as at the end of Quarter 2, which resulted in a forecast drawdown from HRA Reserves of £5.244m rather than the approved budgeted drawdown of £5.047m;

(f)        The HRA Capital Programme was forecasting to spend to budget against the proposed revised budget of £64.483m (as set out in Appendix 4);

(g)       The performance achieved against the Council Plan success measures was as set out in Section 12 of the report and Appendices 5 and 6;

(h)       An annual refresh of ‘Investing in Reading’s Future: Council Plan 2025-28’ would take place, commencing in October 2025, including an update on achievements in 2025 and updated Projects and Key Performance Indicators (KPIs);

(2)       That the proposed amendments to the General Fund Capital Programme (as set out in Section 7 of the report and Appendix 3) and resulting in a revised Capital Programme budget of £76.754m for 2025/26, be approved;

(3)       That the amendments to the HRA Capital Programme (as set out in further detail in Section 10 of the report and Appendix 4) and resulting in a revised HRA Capital Programme budget of £64.483m for 2025/26, be approved.