Shropshire Council sets out next steps to live within its means 

Shropshire Council has published a refreshed draft Medium Term Financial Plan 2027-2032, setting out the next stage of its work to stabilise the council’s finances, reduce reliance on Exceptional Financial Support (EFS), and become financially sustainable. 

The refreshed plan revisits the assumptions made in February, including inflation, pay, debt financing costs, demand pressures and savings delivery. It also updates the position for 2026/27, resets planning assumptions for 2027/28, and starts to set out how the council will rebuild its reserves over the next four years. 

The report makes clear that the financial pressure has not gone away. Demand for services, particularly those supporting vulnerable residents, continues to grow and the wider national financial position remains uncertain. This early review highlights the savings already delivered this year, the tighter spending controls and a more realistic approach to budgeting are helping to improve the forecast position. 

The refreshed plan is the first of several updates that will be brought forward during the year. Each refresh will continue to challenge the assumptions in the plan, test whether spending is being kept within agreed budgets, and review whether the council still needs the level of EFS previously requested. 

The council is likely to need less EFS next year than originally forecast, but this depends on the council continuing to live within its means, delivering achievable savings, and maintaining strong financial grip. The report also stresses that it is still early in the financial year, and that forecasts will need to be kept under close review as more information becomes available. 

A key part of the report is the council’s Financial Sustainability and Recovery Strategy, which sets out how the council will respond to the financial challenge and reduce reliance on EFS over the medium term. The strategy will provide the basis for the difficult decisions that lie ahead. 

Councillor Heather Kidd, Leader of Shropshire Council, said: 

“We have to be honest with people. Shropshire Council is not operating in normal circumstances, and EFS is not a sustainable way to fund day-to-day services. It gives us time to stabilise, but it is borrowing and it has to be paid back. 

“The refreshed Medium Term Financial Plan shows that we are making progress. By going back through the assumptions made in February, tightening our financial controls and recognising the savings already achieved, we now expect to need less EFS than was first forecast. 

“But we must be clear: the pressure has not gone away. Demand for services is still rising, particularly for those residents who need the most support, and there is still a great deal of uncertainty nationally. This is early in the financial year, so we will keep testing and updating our assumptions as the year goes on. 

“We cannot carry on as we were. We have to make sure savings are real, deliverable and properly monitored.  

“Some of the decisions ahead will be difficult. None of us came into local government wanting to reduce services, sell buildings or make choices that affect communities. But the alternative would be worse. If we do not take the decisions needed to stabilise the council, others could end up making those decisions for us. 

“Our priority is to protect the frontline services that support the most vulnerable residents, while making sure those services are delivered as efficiently as possible. We will look at every possible option, partnership and community solution before decisions are made, but we also have to be clear that some things will have to change and some things will have to stop. 

“My message to residents is: we know this is hard, but we do have a plan. Progress is being made, our grip on the finances is improving, and we are determined to keep going responsibly, honestly and with courage.” 

The refreshed draft Medium Term Financial Plan 2027-2032 is one of a number of important and interdependent reports being considered by Cabinet on 8 July. These include the LGA Corporate Peer Challenge progress review and a proposal relating to the sale of an unused council-owned building in Bridgnorth. 

Together, the reports set out the scale of the challenge facing the council, the progress already being made, and the difficult decisions that will still be needed to put the council on a sustainable footing. 

People can read the agenda and papers on the committee pages of the Shropshire Council website.