Minutes of the previous meeting held on 22 July 2025

Noted · Received for information; no decision followed.

The Committee discussed the Council's financial position, with the Chief Finance Officer setting out a projected deficit of £36.5m for 2026/27, reduced to £24.6m if Council Tax were increased by 5%. p19

The Committee discussed East Sussex Highways' second-year contract performance with Balfour Beatty Living Places, which was described as much improved on year one against the same performance indicators, though with scope for improvement in most areas. p30

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• p195.1 The Deputy Chief Executive introduced the report which starts the Committee’s consideration of the budget setting process. The report provides an opportunity for the Committee to look back at the Council’s performance through the year end Quarter 4 Council Monitoring report, and a look forward via the State of the County report. The report asks the Committee to identify areas of interest or focus, and where it would like further information as part of its RPPR work and work programme. 5.2 The Chief Finance Officer outlined in more detail the Council’s financial position which projected a deficit of £36.5m for 2026/27, reduced to £24.6m if Council Tax were to increase by 5%. He explained that, going forward, the 5% Council Tax increase will be included as core spending within the medium term financial plan, as the Government have made this assumption in the recent funding reviews and reforms. He also set out the significant challenges that the Fair Funding Review presents for East Sussex County Council, including changes to the formulae which will redirect adult social care funding from elderly to working age adults. He highlighted that despite an increase in relative need in East Sussex, the Council would be unlikely to receive an increase in funding, due to council tax equalisation. Use of reserves 5.3 The Committee discussed the use of reserves and asked why it had been necessary for the Council to rely heavily on reserves to cover the budget deficit for the last couple of years. The Chief Finance Officer, explained that the need to use reserves was driven largely by increasing need in the county for statutory services, particularly in Adult Social Care and Children’s Services. This increasing need had not been met by a proportionate increase in funding, and that the Government had not yet put forward long-term solutions for SEND provision and home to school transport.
• p307.1 The Assistant Director of Operations, introduced the report on East Sussex Highways Performance, which summarises the performance of the contract through the second year (2024/2025) in achieving the contract Service Performance Indicators (SPIs) and outcomes. These outcomes were set prior to awarding the contract to Balfour Beatty Living Places (BBLP) and were focussed around: quality assurance; value for money; stakeholder management; sustainable economic growth; and carbon reduction. Year 2 performance is much improved on Year 1, against the same 17 SPIs and 6 Key Performance Indicators (KPIs), even with higher targets, but there is still scope for improvement in most areas. The report focussed on areas with improvement plans in place, which directed the contractor to address specific areas of concern and continue to deliver value for money and a continuously improving service to the residents of East Sussex. 7.2 The Head of Highways, presented the report. The report showed more stabilised contract performance for Y2 than in Y1. The contract is delivered under East Sussex Highways, in partnership with BBLP, so the indicators measure the performance of the contract itself, not the contractors. He added that East Sussex Highways continuously review organisational and business processes to streamline service requests. The contract contains two incentives for good performance: a reward model based on SPI performance for each service year; and the possibility of the 7-year contract extension if KPIs are met or exceeded. The Contract Director for BBLP added that BBLP took a continuous improvement approach and while there was a high bar set to achieve KPIs, including 100% compliance to reach ‘green’ status against some indicators, he was hopeful that they could be achieved. 7.3 The Committee asked why some targets are set a 100% compliance, as this seems out of reach in practice.