A report discussed by our Cabinet this week (Thurs 2 July) shows a £2.009 million net underspend for 2025-26, which is an improvement on the forecast position earlier in the year of a £0.5 million overspend.
The reasons for the positive position are due to a combination of factors set out in the report here at item 5 including all departments ensuring tight controls on spending to stay within their budgets where possible and close monitoring of every pound spent. Holding vacancies open and additional income received by some services has also contributed, as well as further savings being realised in our corporate budgets.
Although it is good news that we have overall underspent, there are many variances across the council, including significant overspends in certain services due to rising demand and cost pressures, mainly across Children’s Services and Adult Social Care and Health. The rising demand and inflationary cost pressures, along with real terms central government funding reductions will continue to strain finances despite mitigating measures being put in place.
While noted in the report as significant, these overspends on essential statutory services for children and older people’s care were balanced out with significant underspends in our corporate areas.
Alongside the positive news about the underspend on the revenue budget our general reserve now stands at £36 million, which is in line with the reserves policy approved in February 2026 which increased the minimum requirement of the general reserve from £25 million to £35 million. This is to ensure we continue to manage our finances prudently.
We also achieved the majority of our savings plan in 2025-26, with £35 million being saved against a target of £37 million, with services across the council reducing spending to compensate for the shortfall.
Our Cabinet member for Finance and Efficiency (DOGE) Councillor John Lawson said:
“This is a tremendous achievement involving all teams at all levels across the council and it is satisfying to see that we are leading a well-run, prudent council which is delivering vital services to our residents while cutting out waste and ensuring efficiency is at the core of all that we do.
“The forecast position improved greatly in the last three months of the financial year and this is down to hard work, careful planning and scrutinising every pound spent.
“Although cost and demand pressures remain, especially in our adults and children’s services, this achievement means we have started the new financial year positively, knowing that we have the right mechanisms in place to ensure effective financial control.
“We owe it to the council tax payers of Derbyshire to ensure we keep balancing the books while providing quality services to our residents who rely on them. This report demonstrates that we achieved what we set out to achieve last year. However we are not resting on our laurels and will continue to strive for improvements at the same time as minimising spend wherever possible.”