Devon County Council has delivered a major financial turnaround during the first year of the Liberal Democrat administration. It has moved from a projected £14.7 million service overspend to a final service underspend of £2.98 million while protecting frontline services.
When the new administration took office in May 2025, it inherited both the Council’s approved budget and the existing savings programme. The Council’s formal Month 4 financial monitoring report subsequently forecast a £14.7 million service overspend for the financial year.
Following strengthened financial oversight, tighter budget management, improved forecasting and closer working between councillors, officers and frontline services, the Council has now delivered a significantly improved year-end position.
The Council’s financial position, presented to Cabinet on 20 May 2026 as part of the 2025/26 Revenue and Capital Outturn Report, confirms:
• An inherited projected service overspend of £14.7 million at Month 4 has been turned into a final service underspend of £2.98 million.
• A balanced position delivered against a net revenue budget of £695.2 million.
• £17.9 million of savings achieved during one of the most challenging periods local government has faced financially.
• An underlying underspend of £7.8 million, enabling reinvestment into frontline priorities and reserves.
• Adult Social Care delivered a £1.65 million underspend, achieving £7.7 million of its £8.2 million savings target.
• Children’s Services (General Fund) delivered a £405,000 underspend.
The improved financial position has enabled targeted reinvestment into priority services, including:
• £1 million invested into Children’s Social Care workforce recruitment and retention.
• £416,000 invested into SEND reform diagnostic support.
• £2 million invested into organisational transformation and resilience ahead of Local Government Reorganisation.
• £4 million additional investment for highways maintenance teams.
The Council has also maintained its General Fund balance at £16 million and increased earmarked reserves to £136.7 million despite continuing national pressures facing local government.
Councillor James Buczkowski, Cabinet Member for Finance and Public Value, said: “This was the first year of the new administration, and when we took office we inherited an extremely challenging financial position, alongside the existing budget and savings programme.
“The Council’s own formal Month 4 monitoring report forecast a £14.7 million service overspend. Turning that position around into a final £2.98 million service underspend represents a very significant improvement in financial control, oversight and organisational discipline.
“This has not been achieved through cuts for the sake of cuts. It has been achieved through stronger financial grip, better forecasting, constructive working between councillors and officers, and a clear organisational focus on public value and responsible stewardship of public money.
“In the current local government environment, where many councils are facing severe pressures particularly within Adults and Children’s Services, it is particularly significant that Devon has delivered stable positions in both areas while continuing to invest in improvement and resilience.
“But we are not complacent. We know there are still major long-term challenges around SEND, social care demand, inflation and Local Government Reorganisation.
“What this outturn demonstrates is that Devon County Council is becoming a more financially disciplined, evidence-led and resilient organisation, with a stronger focus on delivering value for residents.
“And importantly, this financial stability now allows us to reinvest into the services residents care about most, including highways, children’s workforce stability, SEND reform and long-term organisational resilience.”
Councillor Julian Brazil, Leader of Devon County Council, said:
“When we took office in May 2025, we inherited the budget and savings programme. What we changed was the trajectory.
“This administration has brought stronger financial control, improved oversight and a clearer focus on long-term sustainability.
“But stable finances are not the end goal – better outcomes for Devon residents are.
“Strong financial management should protect services, unlock investment and strengthen resilience. That is exactly what this outturn demonstrates, and it provides a stronger foundation for the future of Devon County Council.”
