Knowsley Council’s Cabinet has tonight received an update on the council’s Revenue budget for 2026/2027 and the council’s financial strategy.
The council’s robust approach to financial management has maintained a relatively stable financial position in recent years, with the council reporting a balanced budget for the last six consecutive years. This has also resulted in no cuts to front-line services or job losses.
The council faces a range of financial risks and uncertainties over the coming years, including the continued increase in demand for services and the need and cost of social care provision.
To continue to provide the same level of service provision, the council needs to invest £29m in total in 2026/27. This investment mainly includes:-
- £12.2m to help to manage the growth in demand for Adult Social Care, Children’s Social Care, Special Educational Needs and / or Disabilities and Home to School Transport services
- £4.5m to improve stability in the social care market – including costs arising from the increase in the real living wage and employer national insurance contributions.
- £8.1m to address unavoidable pressures from pay inflation, price inflation and new statutory requirements and organisational pressures identified through ongoing monitoring of service budgets (including the introduction of the new national food waste recycling requirements).
- £3.9m to increase capacity across the council to support the management of increasing demand (particularly in respect of Children’s Social Care services), supporting the Children’s Services improvement journey.
The Government has consulted on fundamental long-term reform of local government funding – known as the “Fair Funding Review”. The decade of cuts to local government funding from 2010 to 2020 under previous Governments left the local government sector as a whole significantly underfunded and this review has been welcomed both in terms of the stability it will offer the council and the funding provided.
Knowsley Council welcomes the principles of the Fair Funding Review as an important step in addressing the enormous pressures faced by councils.
Cllr Jayne Lonergan, Cabinet Member for Resources, said:
“We have been lobbying the Government to ensure that the principles of fairer funding mean funding is prioritised where it is needed the most. I’m pleased that the Government has listened and is investing in areas like Knowsley to boost their revenue budget as well as addressing our high needs deficit which is supporting children and families with special educational needs and disabilities.”
Based on the provisional funding allocations for the council, the revised medium-term financial forecasts confirm that the 2026/27 budget can again be balanced without the need for cuts to front-line services.
Cabinet were also updated on how the council will develop and implement a Transformation Programme of improvements which deliver both the best outcomes for residents and also drive down the future levels of demand and cost currently built into the medium-term financial forecasts. This will deliver financial sustainability and meet the budget gap in 2027/28 and 2028/29.
Cllr Lonergan added:
“Our resources are effectively being targeted where they are needed the most and we are also developing a comprehensive transformation programme which will identify how existing resources can be reallocated to deliver the improvements needed, particularly around our Children’s Services improvement plan and the rising cost of residential placements for our children and young people.
“For this coming year, we are predicting a stable position which is thanks to the robust financial management of our staff and, as the Local Government Association Corporate Peer Challenge Team identified, the ‘forensic grip’ we have on the budget.”
The Revenue Budget will now be considered at full Council on 4 March 2026.