Peterborough council tax to rise but ‘services are safe’ according to city council’s new balanced budget
Peterborough’s Council tax is set to rise – but councillors have said services are safe in the city.
A draft budget for the next financial year and a three-year financial strategy suggesting a balanced budget position up to 2029 were both considered by Peterborough City Council’s ruling Cabinet last night (February 10).
In its monthly meeting, Cabinet reviewed and recommended the 2026/27 budget – which included plans to raise Council Tax by nearly 5 per cent. This, along with the Medium-Term Financial Strategy (MTFS), was presented by the Cabinet Member for Finance and Corporate Governance, Councillor Mohammed Jamil (Lab).
“The budget includes a council tax increase of 4.99 per cent – this equates to an increase of £1.68 a week for a Band D property,” he said.
“Despite this, we continue to charge one of the lowest rates of council tax in the country, around £200 less [annually] than some of our neighbouring councils.”
Cllr Jamil spoke at length as he introduced the largely positive financial forecast:
“For the first time in many years, the draft budget and the MTFS set out a balanced budget in each of the next three years,” he explained.
“This positive position is a result of the Government’s Fairer Funding review finally being implemented.”
Fairer Funding is a government funding initiative which aims to direct more financial support to areas, like Peterborough, with higher levels of deprivation and demand for services. As a result, Peterborough City Council can expect to see its funding for services rise by £76m by 2028/29, an increase of 31 per cent when compared to 2025/26.
Describing this financial support as “long anticipated and desperately needed,” Cllr Jamil said Fairer Funding would allow the council to move “full steam ahead” with its plans to improve its financial resilience, thereby enabling it to invest in key public services and rebuild its reserve balances.
Cllr Jamil went on to highlight that the balanced budget would enable the authority to invest in:
A new swimming pool
Additional social workers
Investment in AI
Investment in a new Crisis and Resilience Fund (CRF)
Enhancing Peterborough city centre
Investment in Families First programme.
Fellow cabinet members were keen to praise the eight years of effort which had gone into lobbying for the Fairer Funding support, and applauded the cross-party consensus needed to help the authority get on top of its finances.
“It has been a Herculean effort to get to where we are,” said Fletton & Stanground councillor Christian Hogg (Lib Dems).
“It’s the first time I’ve seen a zero deficit which goes into the mid term,” he noted.
John Howard, Conservative councillor for Hargate & Hempsted, also commended Cllr Jamil and his finance team: “It’s great to see a balanced budget again,” he said, adding, “it’s not easy.”
Speaking after the meeting to the Local Democracy Reporting Service, Cllr Jamil shared his thoughts on the positive impact tonight’s recommendations will make.
“I’ve been a councillor for 17 years and we’ve had to [continually] cut services,” he said.
“This has been the first time in such a long time where services are safe.”
As pleased as he was, the councillor was keen to highlight the fact that there are still “significant financial challenges” facing the council.
“We’ve got an almost £6m overspend this year,” he said, “[and] our reserves are low.”
“It’s going to take a good 2-3 years before we can get on to somewhere where we can say ‘well actually we’re comfortable now,’ however, with this three-year budget, we know we can achieve that.”