Bedford Borough Council forecasts a £3.6m overspend even with £25m of government support, led by children's care, and a £32.1m gap for 2027/28.

Bedford Borough Council is forecasting a £3.647 million overspend this year. That is after counting £25 million of Exceptional Financial Support from the government, which was built into the budget before the year began.

The figures are in the council’s 2026/2027 revenue and capital budget trends report. It covers the three months to 30 June and goes to the Executive at 2.30pm on Wednesday 16 September.

The report says the position “has deteriorated but at a slower rate”. The pressures are in services driven by demand: children’s placements, temporary accommodation and housing benefit, and school transport.

Where the money is going

The council set a net budget of £228.045 million. It now expects to spend £231.692 million. By directorate, the forecast is:

Directorate Budget Forecast Variance
Children’s Services £57.095m £61.555m £4.460m over
Resources £13.315m £14.411m £1.096m over
Chief Executive’s £9.911m £9.852m £0.059m under
Environment £43.596m £43.152m £0.444m under
Adult Services £84.214m £83.642m £0.572m under
Financing £19.914m £19.080m £0.834m under
Total £228.045m £231.692m £3.647m over

Public health is paid for by a ring-fenced grant of £12.270 million, so it shows no variance.

Bedford Borough Council forecast budget variance by directorate, 2026/27 Forecast at 30 June 2026. Children's Services 4.460 million pounds over budget. Resources 1.096 million over. Chief Executive's 0.059 million under. Environment 0.444 million under. Adult Services 0.572 million under. Financing 0.834 million under. Total 3.647 million over. Who is over and who is under Forecast variance against budget, 2026/27, as at 30 June 2026 (£ million) under budget over budget Children's Services +£4.460m Resources +£1.096m Chief Executive's -£0.059m Environment -£0.444m Adult Services -£0.572m Financing -£0.834m Total +£3.647m Source: Bedford Borough Council, 2026/2027 Revenue and Capital Budget Trends, Executive 16 September 2026, paragraph 5.9. The total already includes £25m of Exceptional Financial Support. Graphic by The Bedford Times
Children's Services accounts for more than the whole overspend on its own; the other directorates' underspends pull it back.

Children in residential homes

Children’s Services is the single biggest problem. Placements for looked after children are forecast to overspend by £3.139 million.

The report blames greater use of residential children’s homes over the last two years, “primarily driven by the 12-14 age group”, and higher prices for outside placements. It says placements in foster care that break down are what drive children into residential care.

The service’s response, according to the report:

  • a group of children is to be stepped down from residential care, with foster carers identified and several going through approval
  • four new social workers joined the team in mid-August
  • high-cost placements are reviewed every week

Home to school transport is forecast £0.465 million over. Children in small or solo vehicles are being offered a personal travel budget instead of a taxi. The report says moving external drivers and assistants onto council contracts typically saves £6 an hour.

Another £0.800 million of the directorate’s planned savings is not being achieved. The biggest piece is money the council expects the NHS Integrated Care Board to pay towards children’s continuing health care. The savings dashboard rates that £600,000 project Red “because no shared funding agreement has been reached with the ICB”. It is forecast to deliver nothing this year.

Supported housing and housing benefit

The Resources overspend is almost all housing benefit. The council pays benefit that the government does not fully refund, and the shortfall is forecast at £0.937 million above budget.

The sharpest rise is in supported exempt accommodation, a type of housing with care or support attached. The report’s own figures:

Month Claims Average weekly benefit
April 2025 371 £279.91
March 2026 441 £330.81
June 2026 469 £343.75

The government only refunds these claims up to Local Housing Allowance rates, which the report says have not kept up with market rents. By the end of June the council had lost £1.185 million on them, 47% of what it paid out.

Short-term leased homes, often let by the night as temporary accommodation, lost another £0.632 million, or 35%. The chief executive has raised the subsidy rules with every MP whose constituency includes part of the borough.

There is one better figure. Temporary accommodation was holding 910 households at the end of June, down from 921 in April. That helped Housing, Homelessness and Customer Contact to a forecast underspend of £0.529 million.

The bigger number: next year

The £3.6 million is this year’s problem. The medium-term forecast in the same report is harder reading:

Year Annual gap Cumulative gap
2027/28 £32.1m £32.1m
2028/29 £8.0m £40.1m
2029/30 £3.9m £44.0m
2030/31 £4.4m £48.4m

Those figures assume no further Exceptional Financial Support. The council told the Ministry of Housing, Communities and Local Government it expected to need £10 million for 2027/28. In June the Executive set a strategy of staying within that figure and ending its reliance on support after 2027/28. A full updated Medium Term Financial Strategy is due at the Executive on 14 October.

Exceptional Financial Support is not a grant. The report explains that the government lets the council treat some day-to-day costs as capital spending. That “creates short-term flexibility but does not resolve the underlying financial challenges”.

For context, the council’s July Executive minutes record a 2025/26 overspend of £17.726 million before support and reserves were applied. The final call on support for that year was £20 million for the revenue budget, plus £1.806 million for the Cleat Hill emergency, subject to ministers’ approval.

Savings: behind, but more than half delivered

This year’s budget depends on £18.646 million of savings. A separate improvement and savings plan report to the same meeting says:

  • £10.528 million had been realised by mid-August
  • the forecast for the full year is £16.723 million, a shortfall of £1.923 million
  • 11% of savings schemes are rated Red, 38% Amber and 51% Green, complete or not project-based

Some of the savings already banked are visible to residents. The savings dashboard lists rural grants and climate change grants each deleted for £100,000 a year, and community chest grants for £10,000.

What the council is holding back

The council has not yet touched its contingencies. They include a £2 million general contingency and £1.439 million for savings that fail. The report says it “would not be prudent” to use them until September’s figures show whether spending controls are working.

A spend panel reviews every purchase over £500. Recruitment requests go through a new Human Resources Board.

The general fund reserve stood at £14.199 million on 1 April. It is forecast to end the year at £15.949 million, inside the £14.6 million to £17.8 million range the council’s risk assessment recommends.

What it means for you

Nothing in Wednesday’s report changes a service or a charge on its own. It is a monitoring report, and the recommendations ask the Executive to acknowledge the forecast. But it sets the scene for the 2027/28 budget, which has a £32.1 million hole to fill.

  • Watch 14 October. The Medium Term Financial Strategy that goes to the Executive that day is where proposals to close the 2027/28 gap will start to appear. The June strategy promised an earlier draft budget so residents can see the cumulative impact of decisions and give feedback.
  • You can ask a question. Public questions are the first item on the Executive agenda. The meeting is in the Council Chamber at Borough Hall, Cauldwell Street, MK42 9AP.
  • Know your bill. Our Bedford council tax bands page sets out this year’s charges, including the £25 million of support that balanced this year’s budget.

The same Executive agenda also carries a scrutiny committee’s call-in of the Mayes Yard preferred developer decision, and the council’s first steps on a new Bedfordshire Minerals and Waste Plan. The extraordinary full council meeting on the elected mayor follows at 6.30pm; we set out what that motion asks for.

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