Derby City Council continues to make progress on its journey to greater financial stability, reporting a forecast underspend at the end of the first quarter of the 2025/2026 financial year.
A report going to the Council’s Cabinet next week outlines a forecast underspend of £1.318 million by the end of March 2026, a result of continued responsible financial management and careful budget setting. This has been achieved despite the ongoing challenges facing local government across the country, and is a significant moment for the Council, which has seen a forecast overspend at the end of Quarter 1 in recent years.
As well as investing around £40 million into essential services this financial year, the Council is also restoring general reserves to £15.8 million, equating to around 4.54% of the revenue budget, and the highest level for several years.
The Council is currently on track to achieve 100% of its £9.861 million savings target for 2025/26.
The continued focus on rebuilding reserves and achieving long-term financial sustainability is part of Derby’s strategy to ensure greater financial stability. This means replenishing reserves wherever possible to build resilience against unexpected pressures and financial shocks.
Despite these positive figures, the Council will continue to practise sensible and responsible leadership, keeping cost saving measures in place and regularly reviewing key pressures, such as the rising demand for social care and support for children with special educational needs and disabilities (SEND). While the Cabinet report shows continued pressures in adult social care, overspend in these areas is being mitigated by underspends in other services.
Councillor Nadine Peatfield, Leader of the Council and Cabinet Member for City Centre, Regeneration, Strategy and Policy said:
Our position at the end of the first quarter of this financial year is very positive, demonstrating our commitment to strong and responsible leadership.
Despite the challenges facing local government nationally, our underspend shows that our careful spending and a robust financial management are paying off, giving us much more stability for the rest of the financial year.
This achievement is a credit to the hard work and dedication of staff from across the council who have worked diligently to ensure that we’re maintaining good value for our residents.
This underspend will allow us to continue delivering vital services efficiently and effectively for the people of Derby, while also building greater resilience for the future.
Councillor Kathy Kozlowski, Cabinet Member for Governance and Finance, said:
It’s very encouraging to see the Council moving in this positive direction at this point in the financial year. Our aim now will be to maintain this position moving towards our ambition of greater financial stability.
The Council is also preparing for potential changes that arise from Local Government Reorganisation, which will reshape local authority structures across Derbyshire
The Council’s quarter 1 financial position will be presented to Cabinet on Wednesday 6 August. The meeting will be available to watch on the Council’s YouTube channel.