Reform’s first KCC budget and the numbers it can’t escape

Kent’s first Reform budget balances the books. It also exposes how little room for error remains

Kent County Council will next week debate the first budget produced under Reform UK control. On paper, it does what the law requires. It balances. But the documents behind that headline tell a more uncomfortable story. This is a budget that relies on savings that have yet to be delivered, reserves that have already been heavily used, and a set of assumptions that depend on pressures in adult social care and special educational needs behaving in ways they have consistently refused to do in recent years.

Read as a whole, the papers describe a council operating with a steadily narrowing margin for error. More than £400m of financial risk is formally assessed by officers as likely rather than theoretical, while the main protection against that risk remains reserves that the council itself acknowledges are weakening. Capital spending has been tightly constrained to avoid adding new pressure to the revenue budget, long-term maintenance backlogs are being managed rather than resolved, and one-off measures are again doing work that would normally fall to recurring income. The budget holds, but only if the optimistic version of events proves correct, which is a lot of work.

That financial reality has already collided with the politics of a new administration. Reform arrived at County Hall promising to root out waste through a high-profile efficiency drive, only for senior figures to concede publicly that there was little left to cut in a council already shaped by years of restraint. Within days of those admissions being made to the Financial Times, the cabinet member most closely associated with that drive, Cllr Matthew Fraser-Moat, stepped aside, triggering a wider argument about credibility, ambition and whether Reform’s promises now sit comfortably alongside its own numbers.

This is therefore not just a debate about council tax or service budgets. It is a test of whether Kent’s new political leadership can reconcile the language that helped it win power with the limits it now documents in detail, and what happens when a balanced budget leaves so little room for anything to go wrong.

The starting point for understanding this budget is the council’s own assessment of risk, set out in the budget risk register. Rather than offering a single headline figure, officers separate risks that could hit the budget in a single year from longer-term structural liabilities that build up over time or crystallise at a cliff edge. The register identifies more than £410m of lifetime financial exposure across risks assessed as likely, including the SEND deficit, while also flagging substantial annual pressures elsewhere in the system. These figures are not additive and are not meant to be read as a single sum. Instead, they describe different ways in which the council’s finances could fail, operating on different timescales but drawing on the same, increasingly limited, capacity to absorb shocks.

The largest risks are familiar, but familiarity does not make them manageable. Adult social care remains the dominant pressure, with demand rising faster than funding, and savings are dependent on fundamental changes to how care is commissioned, delivered, and funded. The council acknowledges that holding down fee increases risks destabilising providers, yet it is relying on exactly that restraint to make the numbers work. If providers fail, costs rise rather than fall. The risk does not sit at the margins. It sits at the centre of the plan.

Alongside this sits the unresolved position on special educational needs and disabilities. Kent’s accumulated Dedicated Schools Grant deficit continues to grow. In practical terms, the council is spending far more on support for children with additional needs than the funding it receives from government. A temporary accounting rule currently hides that gap from the council’s balance sheet, but officers warn that this protection expires in March 2028. If it is not extended or replaced, the deficit would fall directly on the council’s finances. Government support beyond that point is conditional, not guaranteed.

That deadline is not incidental. Under the government’s local government reorganisation timetable, Kent County Council is expected to cease to exist in 2028, with its responsibilities transferred to new unitary authorities. The most severe financial consequences of the DSG deficit therefore sit just beyond the lifetime of the organisation currently setting the budget. It is a problem scheduled to mature at exactly the moment the council itself is scheduled to disappear.

If the override were withdrawn, the impact would be immediate and severe. The council’s own documents link this risk directly to the possibility of being unable to set a balanced budget at all. That is not a footnote. It is a cliff edge.

What makes this more than a technical concern is timing. The budget assumes that pressures can be contained in the short term while reforms take effect, yet the risk register rates further deterioration as likely. There is no meaningful contingency beyond reserves that are already stretched. This is not a problem that can be solved by efficiency alone, and the budget quietly accepts that reality even as the politics around it struggles to keep up.

The same fragility runs through the savings programme more broadly. The budget assumes tens of millions of pounds in future savings, many of them contingent on behaviour change, demand moderation, and new service delivery models that have yet to be fully proven at scale. Officers explicitly rate the non-delivery of those savings as likely. In other words, the council is approving a plan that it knows may not fully materialise, while relying on it anyway.

The reason this does not immediately trigger a crisis is the continued use of reserves and other one-off measures. Reserves are drawn down again to support day-to-day spending, capital receipts are flexibly used to fund transformation work that underpins future savings assumptions, and borrowing is deliberately suppressed to avoid creating new revenue pressures. This approach is orthodox and defensible. It is also finite.

Capital ambition has been pared back not because need has disappeared, but because the ongoing cost of debt would feed directly into the revenue budget and crowd out services. The capital programme is shaped primarily by what the council can afford to service rather than what its assets require. In highways, officers acknowledge an unfunded maintenance backlog of more than £1bn, with available funding focused on safety and network resilience rather than full renewal. Adult social care, despite being the council’s largest and fastest-growing revenue pressure, attracts almost no capital investment at all. Across the estate, assets are being stabilised rather than renewed, and risks are being managed rather than eliminated. The council is prioritising short-term financial stability over long-term repair, not as a strategic choice, but because the alternatives are largely unaffordable.

Again, none of this is hidden. The council is clear in its capital and treasury strategies that borrowing decisions are now tightly constrained by their impact on the revenue budget, and that revenue affordability has become the primary driver of the capital programme. Capital receipts that might otherwise have been used to tackle long-term backlogs are instead being allocated to support transformation activity and short-term financial sustainability. The documents acknowledge that this reliance on one-off measures cannot be sustained indefinitely. The consequence is that options narrow over time, and the council’s capacity to absorb future shocks is steadily reduced.

Politically, this places Reform in an awkward position. The party came to power arguing that councils like Kent were bloated, inefficient and riddled with waste. The first budget produced under its control quietly accepts the opposite. Services have already been stripped back, discretionary spending is limited, and the task now is to manage scarcity rather than uncover hidden excess.

Reform can fairly argue that it inherited this position from decades of Conservative control. The documents support the view that the problems did not emerge overnight and that many of the hardest decisions were taken long before the change in administration. That argument will resonate with many readers. It also only gets you so far. Once a party produces its own budget, it owns both the numbers and the risks they contain, including those it will not be around to manage.

Nowhere has the collision between rhetoric and reality been more visible than in the fate of the council’s Department of Local Government Efficiency, or DOLGE. Launched with fanfare and deliberately styled as a disruptive force, it was meant to symbolise Reform’s promise to do things differently and to expose inefficiency others had ignored.

In practice, the budget papers show that DOLGE has not uncovered a hidden pool of waste. Instead, its work has focused on systems, processes and longer-term transformation, the same terrain councils of all political colours have been working on for years. That does not make the work meaningless, but it does make the original promise harder to sustain, particularly when it collides with the numbers.

That tension became explicit when Cllr Matthew Fraser-Moat, the cabinet member leading DOLGE, spoke to the Financial Times. “We haven’t actually made any cuts,” he said, adding that Reform had blocked some service reductions proposed under the previous Conservative administration, including plans to close libraries.

Similar admissions were made around the same time by Paul Chamberlain, another Reform cabinet member, who told the Financial Times that the administration had expected to find widespread waste and had not, saying services had already been “hacked away for years and years” and describing members of the former Conservative administration as “business people.”

The following day, Fraser-Moat stepped down from his cabinet role. In a statement issued by Kent County Council, he said he had shown a "lapse of judgement" in how he spoke to the press and that the council had now delivered a balanced budget and stabilised its finances. The council’s preceding statement disputing the Financial Times’ reporting did not distinguish between the substance of remarks made by different cabinet members.

The comparison is hard to ignore. Fraser-Moat resigned after making comments that were substantively similar to those made by Chamberlain, who remains in post. The numbers did not change. The politics did.

The distinction appeared to lie elsewhere. Admitting that waste was limited could be absorbed. Saying that no cuts had been made brought the contradiction into sharper focus. The fallout was political rather than financial, but it exposed how thin the line had become between honesty and liability.

That pressure has only intensified as Reform’s future promises have been tested against the numbers. Reform figures have spoken publicly about freezing council tax in 2027–28, but that ambition does not feature as an assumption in the budget itself. Instead, the medium-term financial plan and sensitivity analysis show the scale of the funding gap that would open up if council tax increases were removed.

To deliver a zero increase, the council would need to close a funding gap of £54.2m in a single year. At the same time, the risk register identifies more than £50m of planned savings as vulnerable to non-delivery, and rates that risk as likely. Adult social care savings, on which much of the plan depends, are both essential and uncertain. Reserves cannot be relied on again at the same scale without pushing the council into a far more precarious position.

None of this makes a council tax freeze impossible. It does mean it would depend on an unusually high number of things going right at once, in a system that has repeatedly shown how difficult that is. The budget does not show how this problem is solved. It shows how it is deferred, and who will be left holding it.

Opposition parties have seized on that gap between ambition and evidence. Maidstone Liberal Democrats asked whether Fraser-Moat had been “asked to deliver the impossible” when commenting on his resignation. Green councillor Stuart Jeffery described DOLGE as “hot air and bluster” and said Reform had shown “no understanding of local government.” The Tonbridge and Malling Green Party said the idea that Kent could be cut out of trouble was “the great lie,” arguing that a council starved of funding for more than a decade had already been cut to the bone. Mike Martin, Liberal Democrat MP for Tunbridge Wells, remarked that Reform’s “Elon Musk-style DOLGE Cabinet Member makes his first real saving by resigning.”

Some of this is political opportunism. Some of it is theatre. But none of it exists without the figures that underpin it. Those figures show a budget that balances by narrowing the margin for error, by spending down resilience, and by relying on savings that officers themselves say may not all materialise.

In isolation, there is nothing unlawful or reckless about this approach. The budget follows guidance, is candid about its risks, and avoids the more aggressive accounting practices that have landed other councils in trouble. That does not make it comfortable.

By the council’s own admission, resilience is weakening, backlogs are growing, and future years will be harder rather than easier. This budget buys time. It does not buy certainty.

For Reform, that marks a turning point. The first budget under its control has not collapsed, but it has forced a recalibration of tone and expectation. The language of waste and efficiency has given way to the harder work of managing scarcity, and to the reality that some of the most difficult problems have simply been deferred.

When councillors gather at County Hall next week, they will be voting on more than a set of numbers. They will endorse a strategy that acknowledges the limited room for error, knowing that the documents they are voting on already assume that something will eventually go wrong.

Footnotes

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