Reform UK sets first Lancashire County Council budget

The Reform UK administration at Lancashire County Council has set its first budget – promising what it described as a “tsunami of better services” for residents.

A six-hour meeting at County Hall on Thursday saw the authority agree a £1.3bn financial plan for the year ahead, including a 3.8 percent increase in its share of council tax bills – almost 1.2 percent less than the maximum allowed without government permission or a local referendum. 

Leader Stephen Atkinson hailed what he said was the “incredible” feat of balancing the books against the backdrop of a series of budgetary challenges, while also delivering the lowest council tax rise in 12 years.

However, the ruling group came under fire from several opposition parties who accused Reform of presiding over a plethora of potholes on Lancashire’s roads, continued uncertainty over the future of some care facilities and “cuts” to services.

The alarm was also sounded over the presence in the budget of an £11m “provision” for potential redundancy payments, which one councillor claimed could equate to as many as 400 jobs being on the line.  County Cllr Atkinson said redundancy would be used only as “a last resort”.

Overall, the budget for the 2026/27 financial year includes an additional £7m for the ‘inclusion service’ for children and young people with special educational needs and disabilities (SEND), an extra £17.7m for largely SEND-related transport costs and a total £72m pot for highways maintenance.      

It is also based on £65m of planned savings in the next 12 months, with over £100m more forecast to be required across the following two years.  The authority is facing £99m of cost pressures in the coming year alone – £59.5m as a result of increased demand for services and £39.5m because of inflation.   

County Cllr Atkinson, whose party took control of the authority last May – after eight years of Conservative control – said:  “The challenges this council faces are immense – £1.2bn of debt that is costing £80m a year to service, [while] the majority of the council’s reserves…are tied up in bond investments for up to 92 years and [which], if we sold [them] today, would probably cost the council nearly £350m…in losses.  

“In these circumstances, to deliver a balanced budget is incredible.

“Our budget brings forward a set of benefits for our communities in Lancashire and marks a step change in the way we think about financial management and service delivery in the county. 

“Now we are living within our means under this Reform administration…there will be no volcano eruptions or earthquakes – just a tsunami of better services, common sense, financial prudence and a… strategy to better the lives of the people we represent.”

However, the majority of opposition groups saw things rather differently – and ensured that much of the debate resolved around potholes, care services and council tax pledges.  

Azhar Ali, leader of the Progressive Lancashire official opposition – a coalition of independents and the Green Party – said of the current condition of Lancashire’s roads that residents were “sick and tired of replacing their damaged suspension [and getting] punctures [and] ripped tyres”.

“[They] see shoddy workmanship, they see potholes turn into craters and they say ‘enough is enough’. The administration had enough money from government to make a difference, but all we’ve had is excuses and spin,” County Cllr Ali said.

Several proposed opposition amendments to the budget suggested a boost to road repair funding, over and above that included in Reform’s plans.

The Liberal Democrats slated an extra £5m over the next 12 months, while the Conservatives put forward £3.5m this year and £1.5m the next.
Presenting the Lib Dem amendment, County Cllr Mark Jewell accused Reform of breaking a pre-election pledge to fill “every pothole”.  He added:

“We have seen potholes like craters on the moon on our streets.   

“This is, in part, due to the ‘blobbing’ repairs undertaken by the previous administration that are now falling…[but we] also need to invest more money for more targeted repairs to get on top of the sorry state of our roads. Do it once, do it properly.”

Tory opposition group leader Aidy Riggott said the extra funding his party was proposing would enable Reform to do whatever was necessary to “make our roads safer, more usable and more acceptable to residents once again”.  

Cabinet member for highways and transport Warren Goldsworthy acknowledged that “the roads are in a terrible state and have been since Christmas” – and apologised.

However, he stressed that prior to the depths of winter setting in, the authority had 47,000 fewer potholes as of just before Christmas than it did at the same point 12 months earlier.  That was the first public update to a figure previously revealed by the Local Democracy Reporting Service (LDRS) which showed a 25,000 drop in defects between September 2024 and September 2025.

“I get [that] it’s a stick to beat [us] with, but…the last 6-8 weeks have done terrible damage – and we will get on top of it,” County Cllr Goldsworthy said.  

“[But] the maintenance backlog across our entire network …is £650m.  We did get £20m last year off central government, but…I’m tired of being told, ‘You’ve got [an extra] £20m, fix the rest of the roads’ – because it just doesn’t work, it’s for the birds.  

“I accept the roads have had a terrible time in the last eight weeks – we’ll get on top of that and by the end of this year [they] will be in an even better state.   Can you imagine where we’d be right now if we weren’t nearly 50,000 potholes [better off] at the end of last year?”

However, deputy Progressive Lancashire group leader – and Green Party leader – Gina Dowding cautioned Reform against “put[ting] all their eggs in…the potholes basket” when it came to road funding.  

“They have rolled up a whole range of transport grants [and] they’re investing them next year into potholes .   What we’re going to see…is a lack of funding for all the [other] important schemes…[like] pedestrian safety, [the] conditions of our pavements, [new] pedestrian crossings [and] dropped kerbs,” said County Cllr Dowding, referencing the £5.5m Progressive Lancashire was proposing be spent on “community safety and highways schemes”.

County Cllr Riggott said the Conservatives would be supporting the Reform budget proposal as it was “broadly a continuation of the direction of travel we set as an administration” – but he stressed that did not mean “we agree with every line in it”.

However, it was the suggested similarity to a budget that the Tories might have proposed that Labour group leader Mark Clifford cited as reason for his party’s abstention.  

He said the situation may have been different if any of the opposition group amendments had been accepted by Reform, but he said:  “[Otherwise], this [budget] document is just as dull as dishwater – it’s not ambitious.”

But the cabinet member holding the purse strings, resources portfolio boss Ged Mirfin – who was part of the last Tory administration until defecting shortly before last year’s county council elections – said Reform was now in charge “precisely because the old parties failed”.

“Under previous administrations, overspends were becoming a habit – under Reform they have been sharply reduced.  This did not happen by accident – it happened because we were prepared to take decisions the old parties avoided.”

Multiple opposition politicians pointed to Reform enjoying the good fortune of two funding windfalls in the form of a more generous grant settlement from the government after a long-awaited overhaul of the system – rendering the authority £28.4m better off this year – and a reduction in the pension contributions the county council has to make, which will boost the coffers by more than £20m, according to the budget papers. County Cllr

Ali said that showed that the budget had not been the result of “Reform magic”.

However, County Cllr Atkinson noted that the extra cash came nowhere near the £99m in cost increases the authority was having to absorb in 2026/27.

CUTS OR CORNUCOPIA?

The £65m worth of savings identified within the budget for 2026/27 are made up of £43m already baked in from last year’s Conservative plans and a further £22m added to the tally by Reform in order to balance the finances in the year ahead. 

Almost a third of the overall savings total – nearly £23m – is related to adult social care. The budget documents set out a series of savings aspirations across that service area – including £4.3m this year from preventing people having to go into long-term care, after a stay in hospital, by securing more community-based support. Similarly, £11m is sought over the next three years from ‘prevention and early intervention’ in order to help people remain independent and in their own homes for longer. 

Pressed during an interview with the LDRS before the budget meeting as to why he believed such significant future sums could be raised from policy aims that have been long established in social care, County Cllr Atkinson said his administration now had “a track record” of delivering savings – having reduced the county council’s forecast overspend for 2025/26 from £28m last June to £6m currently.

However, back in the County Hall chamber, Progressive Lancashire county councillor Michael Lavalette said members had been presented with a “continuity budget” in the mould of the Tories. Anything characterised as ”efficiency savings” usually meant, for staff, “There’ll be more work for you, there’ll be less of you and your working conditions and pay will go down,” he said.

He added that the £11m included in the budget for possible redundancy costs meant “about 400 jobs potentially going across Lancashire”.
“This is a budget of cuts and job losses from Reform,” he said.

However, County Cllr Atkinson said redundancies would be “a last resort – and it’ll be after people are [considered for] going into other positions”. 
“Maybe some people might want early retirement, “ he added.

“We value our workforce, but the challenges of efficiency and AI [artificial intelligence] are coming and are going to be felt across the country – but we will do it with respect and with a joint conversation with our fantastic members of staff.”

He also hit out at the opposition for not suggesting alternatives if they were opposed to redundancies. 

Meanwhile, the cabinet member for data, technology, customer and efficiency, David Dwyer, revealed the extent to which the authority was “embracing AI and automation”. 

“We have got 1,400 officers who are using AI at an advanced level to improve the lives of residents. Early estimates are showing that…the use cases that we have developed in conjunction with Microsoft are going to yield 200,000 hours per year of officer time – hours no longer spent on administration, hours that can be spent with residents.” 

COUNCIL TAX CONTROVERSY

Reform came under attack for what Liberal Democrat group leader John Potter said were “broken” promises on council tax.

“We’ve got your [local election] leaflets…you said…you’d freeze council tax. Either you lied to the electorate last year or you didn’t understand local government finance…[although] it could be both,” County Cllr Potter said.

County Cllr Atkinson said the party had been “misrepresented”, adding: “The national policy was that we would save £5 in every hundred – and on a £1.3bn budget [at Lancashire County Council], that’s £65m and that’s in the budget. 

“Reform UK controlled the leaflets and not one official leaflet said we would freeze council tax.”
Speaking to the LDRS ahead of the meeting, County Cllr Atkinson said any leaflets that had made reference to council tax freezes had been “rogue”. 

The LDRS last month published election literature, purportedly from Reform UK and distributed in Lancashire, making a council tax freeze pledge.

Of the now agreed 3.8 percent rise for Lancashire County Council this year, two percent is ringfenced for adult social care as part of the dedicated ‘precept’ permitted by the government for that purpose. The remaining 1.8 percent is almost 1.2 percent lower than the maximum hike that could have been levied for other services.

CARE ROW RUMBLES ON

Staff and families connected to some of the 10 elderly care facilities Lancashire County Council placed under review last October – because of concerns about the poor condition of the buildings from which they operate – were present in the public gallery at County Hall for the budget meeting.

The authority’s Reform UK cabinet said earlier this month that it had “no intention” of closing the five care homes that it had placed under the microscope and that it would bring forward more details of its plans for their futures in April as part of the conclusion of a formal consultation process.   However, five day centres that are also part of the review have received no such assurance as they continue to await their fate.  

The budget does not identify any savings to be generated from care facilities, but County Cllr Ali noted that there was “a big fat zero” included for any investment in them.  

“Reform had the opportunity to put money where their mouths were,” he said, highlighting a Progressive Lancashire proposal to create a £4m fund for modernisation of the services. 

However, cabinet member for adult social care Graham Dalton said the “new models of care” being developed by the authority had to be made “sustainable”.

“We will not do that by throwing a million quid here, a million quid there –  we might fix a roof, we might fix a wall, but what we will not do is give…the people of Lancashire the care that they need going into the future.  We need first class care for the people of Lancashire, not something that is just patched up,” County Cllr Dalton added.

BONDS BLACK HOLE

The budget has seen a special cash pot established to help Lancashire County Council deal with the fallout from an investment in government and corporate bonds that are now worth around £350m less than at the time they were purchased around five years ago.

That means the authority is unable to sell the bonds in order to free up the reserves it has invested in them, because of the huge loss it would currently incur by doing so.

The county council plans to transfer £58.4m over the next three years into what it is calling the Working Capital Enhancement Reserve (WCER). 

The new pot will, according to budget documents, “reduce the net cost of [the] loans currently needed to maintain levels of working capital”.   Capital funding supports the authority’s major projects, involving the creation or maintenance of assets.

The reserve will also be used to offset any losses if there comes a point when it is deemed appropriate to offload the bonds – a decision which is being kept under review.

In 2026/27, £15.9m has been earmarked from the budget to go into the WCER, while it is estimated the bonds themselves could be generating an additional £10m over the year if they were currently invested in the overnight money markets.

BUDGET BREAKDOWN

Adults, health and wellbeing Services – £558.5m

Education and children’s services – £265.7m

Place services (including highways and environment) – £261.9m

Chief executive services – £1.3m

Corporate budgets – £151m

TOTAL NET BUDGET (2026/27):   £1.33bn  (of which £717.1m comes from council tax and the remainder from business rates, government grants and other sources)

COUNCIL TAX CALCULATOR

More than half of Lancashire households are in the lowest two bands for council tax – A and B.   This is how much Lancashire County Council will charge residents in council tax across all bands from April 2026 (increase from 2025/26 shown in brackets):
Band A – £1,201.17 (up £43.98)
Band B – £1,401.36 (up £51.30)
Band C – £1,601.56 (up £58.64)
Band D – £1,801.75 (up £65.96)
Band E – £2,202.14 (up £80.62)
Band F – £2,602.53 (up £95.28)
Band G – £3,002.92 (up £109.94
Band H – £3,603.50 (up £131.92)

Note – council tax bills for individual households will be higher, as they include charges levied by Lancashire’s 12 district councils and the police and fire services.   Blackpool and Blackburn with Darwen councils are not part of the county council area and so set their own council tax rates.