Bromley Council 4.99% Tax Hike, £26.4m Reserves 2026

Key Points

• Bromley Council plans to increase council tax by 4.99 per cent, the maximum allowable without a referendum, adding nearly £100 annually to the average Band D household bill.
• The council will use £26.4m from reserves to balance the 2026/27 budget, following £77.6m spent over the last two years.
• A projected budget gap of £43.3m in 2027/28 is expected to widen to £61.1m in 2028/29, driven by rising adult and children’s social care costs and reduced central Government funding.
• The Government’s Fair Funding Review is blamed for annual losses exceeding £30m by 2028/29, with the 2025/26 settlement already disadvantaging the council by £3m.
• Combined with Mayor Sadiq Khan’s proposed 4.1 per cent GLA precept rise, Bromley residents face a 4.78 per cent total council tax increase, lifting Band D payments from £2,042.46 to £2,140.04.
• Savings of nearly £30m via the ‘Transforming Bromley’ project include 15-year leases for up to 300 residential units, realigning Children and Family Centres and Youth Hubs into Family Hubs, and reviewing adult social care delivery.
• Earmarked reserves will drop from £192m to £114m, with general reserves at £20m; further declines to £62.7m by 2028/29 are forecast without action.
• The proposals go before the Executive on February 11, 2026, for approval to proceed to the full council budget meeting on February 26, 2026.

Bromley (South London News) February 11, 2026 – Bromley Council is poised to approve a 4.99 per cent council tax hike and the use of £26.4m from reserves to balance its 2026/27 budget, amid mounting financial pressures from social care costs and diminishing Government funding. This decision, detailed in a report to the Executive meeting tonight, will raise the average Band D household bill by £97.58 to £2,140.04 when combined with the Greater London Authority precept increase. Council officers attribute the shortfall primarily to central Government policies, including the Fair Funding Review, which they claim will strip over £30m annually by 2028/29.

Why Is Bromley Council Raising Council Tax by 4.99 per cent?

The proposed 4.99 per cent increase represents the highest permissible rise without triggering a referendum, aimed at generating £10.5m in additional revenue.

As outlined in the council’s report to the Executive, this measure forms part of a broader strategy to address immediate and future budgetary gaps. The report highlights that council tax levels in Bromley remain below the national average, yet the funding formula adjustments have exacerbated local pressures.

Councillors and officers emphasise that the hike is unavoidable given escalating demands. The combined effect with Mayor Sadiq Khan’s planned 4.1 per cent uplift to the GLA precept—supporting Transport for London, emergency services, and citywide resources—results in a net 4.78 per cent rise for residents. For a typical Band D property, this translates to an extra £97.58 per year, rising from £2,042.46 in the prior year.

How Will the GLA Precept Increase Affect Bromley Residents?

The GLA precept, controlled by Mayor Sadiq Khan, targets funding for TfL and other metropolitan services. Khan intends a 4.1 per cent increase, which layers atop Bromley’s local rise. This dual adjustment underscores the interconnected financial strains on outer London boroughs like Bromley, where local taxes fund both borough-specific and regional needs.

What Budget Gap Does Bromley Face in Coming Years?

Bromley anticipates a £43.3m deficit in 2027/28, ballooning to £61.1m in 2028/29. Primary drivers include surging costs for adult and children’s social care, alongside a contraction in central Government grants. The council report explicitly blames the Government’s Fair Funding 2.0 Review, stating:

“It was originally hoped that the Government’s Fair Funding 2.0 Review would provide a fairer (and higher) level of funding for the council. The funding formula used for additional grant funding in the 2025/26 settlement disadvantaged the council compared with the previous formulas by around £3m.”

Further, the report notes:

“The outcome of the Government review, which is effectively a redistribution of grant funding, results in significant losses for the council. The outcome also has an underlying expectation that additional funding required may need to be met by significant council tax increases to fund services, whilst council tax levels remain below the national average.”

This redistribution is projected to cost Bromley over £30m yearly by 2028/29, factoring in inflation.

How Much From Reserves Will Bromley Spend and What Are the Risks?

To bridge the £26.4m shortfall for 2026/27—despite tax rises and savings—the council will draw down reserves. Over the past two years, £77.6m has already been expended, reducing earmarked reserves from £192m to £114m, while general reserves hold steady at £20m. Projections show earmarked reserves falling to £62.7m by the end of 2028/29, excluding further gaps from 2027/28.

The report warns:

“Without any action to address the budget gap in future years, reserves will need to continue to be used with the risk of the budget gap increasing in future years and becoming unsustainable.”

This reliance on finite reserves signals long-term vulnerability, as officers stress the unsustainability of ongoing drawdowns.

What Savings Is Bromley Targeting Through ‘Transforming Bromley’?

The ‘Transforming Bromley’ initiative promises nearly £30m in efficiencies. Key elements include securing 15-year leases for up to 300 residential units to curb expensive temporary accommodation reliance. The council also plans to realign six Children and Family Centres and four Youth Hubs into four integrated Family Hubs, streamlining operations.

A comprehensive review of adult social care delivery aims to optimise spending in this high-pressure area. Despite these measures, combined with the £10.5m from tax rises, the gap persists, necessitating reserve use. Officers present these as pragmatic steps to safeguard core services amid external constraints.

Why Does Bromley Blame the Government for Its Financial Woes?

Throughout the report, Bromley lays responsibility at the Government’s door for funding shortfalls. The 2025/26 settlement’s formula shift disadvantaged the borough by £3m relative to prior years, while the Fair Funding Review redistributes grants unfavourably.

This, coupled with static or declining central support against rising care demands, forms the crux of the council’s narrative.

The council posits that Government expectations implicitly endorse higher council tax to compensate, even as Bromley’s rates lag national averages. This positioning frames local actions as reactive to Westminster’s policies, a common refrain among cash-strapped authorities.

When and How Will Decisions Be Made on These Proposals?

The Executive convenes this evening, February 11, 2026, to scrutinise the report and vote on advancing the plans. Approval would forward them to the full council’s budget meeting on February 26, 2026, for final ratification. This timeline aligns with statutory requirements for local authority budgeting.

Members will weigh resident impacts against fiscal imperatives. The process ensures democratic oversight, though the maximum tax rise circumvents referendum thresholds, streamlining implementation if endorsed.

What Happens If the Budget Plans Fail?

Unaddressed gaps risk service cuts or further reserve depletion, potentially breaching financial prudence rules. The report underscores unsustainability, urging proactive measures like enhanced efficiencies or lobbying for fairer funding. Bromley’s trajectory mirrors wider South London and national trends, where social care dominates expenditure.

Residents face trade-offs: higher taxes preserve services, but reserves erosion threatens resilience. The council retains general reserves at £20m as a buffer, yet sustained deficits could necessitate deeper interventions.

Broader Context for South London Councils

Bromley’s plight reflects systemic pressures on outer boroughs. Similar hikes and reserve uses occur across South London, with GLA precept rises amplifying local burdens. Government reviews, intended to equalise funding, have instead penalised certain authorities, fuelling calls for reform.

As a South London authority, Bromley balances suburban needs with metropolitan ties. ‘Transforming Bromley’ exemplifies adaptive governance, yet underscores dependency on volatile grants. Residents, already below-average payers, absorb the strain.

This story, drawn comprehensively from the council’s Executive report ahead of tonight’s meeting, encapsulates the delicate fiscal tightrope. With decisions imminent, Bromley exemplifies local government navigating national policy headwinds while prioritising resident services.