Council tax freeze proposed as Rushcliffe faces 59% drop in business rates income

Rushcliffe Borough Council is set to freeze its share of council tax while managing a significant reduction in funding, under budget proposals to be discussed by cabinet next week.

A report to cabinet on Tuesday 10 February outlines the authority’s 2026/27 budget and a five-year Medium Term Financial Strategy running to 2030/31. The proposals are based on the Government’s provisional finance settlement, with final figures due later in February before the budget is approved by full council.

Councillors are being asked to recommend setting the borough council element of Band D council tax at £161.76 for 2026/27, unchanged from the current year. The freeze would be for one year and is intended to support residents during ongoing cost-of-living pressures, although it would also reduce the council’s future income compared with increasing the charge.

Despite the freeze, special expenses charged in specific parish areas would rise slightly due to maintenance costs and tax base changes. In West Bridgford the Band D charge would increase from £64.84 to £67.40, while Keyworth would rise from £3.21 to £3.35 and Ruddington from £3.14 to £3.40.

The report highlights substantial changes to local government funding following the Government’s Fair Funding Review and a national business rates reset. Rushcliffe’s retained business rates income is forecast to fall from £6.676 million in 2025/26 to £2.729 million in 2026/27 — a reduction of around 59 per cent — with only partial transitional support expected in later years. The Nottinghamshire Business Rates Pool will also be dissolved due to increased financial risk.

- Advertisement -

Overall core spending power is expected to reduce by 2.46 per cent across the multi-year settlement period even before the council tax freeze is applied.

A Revenue Support Grant has been reintroduced as part of the new funding system, with Rushcliffe due to receive £5.21 million in 2026/27. At the same time, previous funding streams such as the New Homes Bonus have been absorbed into that grant rather than paid separately.

Inflationary pressures remain built into the plans, with average inflation assumed at three per cent for 2026/27 and pay costs also expected to rise by three per cent before stabilising in later years. Some fees and charges will increase to reflect higher costs, while more sensitive services such as home alarms are being limited. Garden waste charges will rise annually by £2, with an additional £5 increase for second and subsequent bins next year.

The council also expects new national recycling requirements, including expanded food and glass collections, to create additional long-term cost pressures. Although Government grant funding will offset some expenditure, a net annual pressure of £879,000 is forecast by 2030/31 and will initially be managed through reserves.

Across the five-year strategy the authority plans £24.3 million of capital investment focused on maintaining assets and supporting economic development, with no external borrowing anticipated unless other options are exhausted.

Savings and efficiencies totalling £1.998 million are proposed through a transformation and efficiency programme, producing a projected overall surplus of £570,000 across the period, although the report notes the position remains vulnerable due to inflation, funding reform and the potential impact of future local government reorganisation.

Council reserves are expected to rise from £24.2 million to £26.2 million by 2030/31, but most are earmarked for specific purposes including reorganisation costs, climate work and vehicle replacement, and are considered necessary to manage financial risk and volatility.

The cabinet will consider the proposals next week before making recommendations to full council, which will make the final decision once the Government confirms the funding settlement.