City of York Council publishes proposed 2025-26 Budget

City of York Council has published its draft budget proposals for the 2025/26 financial year.

These proposals outline significant investments in essential services and targeted support for residents, while continuing to deliver necessary savings and the long-term financial sustainability of council services.  

The budget reflects the council’s commitment to protecting the services residents rely on, supporting vulnerable communities, and building a fairer, more sustainable York despite ongoing financial challenges. 

Investing in essential services 

The budget sets out significant investment to meet growing demand and rising costs in key areas, including: 

• £8 million, which will be used to meet increased demand for services, support people with complex care needs, and address cost pressures in care home placements and the care support people receive in their homes. This includes meeting the Council’s statutory responsibilities for supporting older residents and disabled people.
• £2.7 million for Children’s Services to cover rising costs of care and additional support for vulnerable young people.
• £9 million to cover inflationary cost pressures across the Council and its contracted services.

Councillor Katie Lomas, Executive Member for Finance, Performance, Major Projects, Human Rights, Equality and Inclusion, said: 

“This year’s budget remains extremely challenging and prioritises the services residents value most, ensuring we protect those who need support while making strategic investments to deliver on Council Plan priorities”. 

Leader of City of York Council, Councillor Claire Douglas said:

“This budget reflects the difficult but necessary decisions required to meet the financial challenges York faces. By focusing on the services that residents value most and supporting our most vulnerable communities, we are taking a balanced approach that delivers for the city. This budget ensures we stay on track to deliver our Council Plan for York. It focusses on our core principles of improving affordability and health, equalities and tackling climate change”. 

Delivering support where it’s needed most 

The draft budget also includes targeted additional investment of £180,000 to help residents most affected by the cost-of-living crisis. This includes an increase of over 50% in the council’s main hardship support fund. New funding will also explore Dial and Ride replacement options, and support organisations via Financial Inclusion Steering Group Grants, giving support to those experiencing ongoing effects of the cost-of-living crisis. 

Councillor Katie Lomas added: 

“This budget reflects our commitment to supporting York’s most vulnerable residents while protecting the essential services that residents rely on. We’ve been able to protect these services by taking a different approach – by increasing income, meaning we need to make far fewer service reductions.  And by balancing immediate needs with long-term transformation, we are working with partners and organisations to ensure York continues to thrive as a city that works for everyone.” 

Savings and transformation to balance the budget 

The budget meets a £6.4 million funding gap through a combination of savings, carefully planned to minimise the impact on services, increased efficiency and income generation. These proposals include: 

• £2.8 million from increased income, including parking charges and other fees.
• £1.8 million from in-house council savings delivered through the ‘Working As One’ City transformation programme, focusing on more effective service delivery.
• Additional savings through measures such as streamlining Hostile Vehicle Barrier Management and Community Safety operations.

To support these savings and fund critical services, a 4.99% council tax increase is proposed, with 2% ringfenced for adult social care, ensuring the council is able to look after the city’s most vulnerable residents. 

Debbie Mitchell, Director of Finance, said: 

“Our savings proposals are designed to deliver maximum efficiency while safeguarding the services people depend on. This balanced approach allows us to invest in essential areas like social care and children’s services while preparing for future financial challenges.” 

Acknowledging resident feedback

The draft budget has been shaped by feedback from thousands of residents, businesses, and partners who participated in Our Big Budget Conversation. Key consultation results included: 

• Pothole repairs: 86% of respondents opposed reducing spending on road maintenance, underlining the importance of maintaining York’s road network. As a result, the council has protected its highways maintenance budget which is set to increase overall, once Govt highways funding is allocated;
• Parking charges: Approximately 55% of respondents supported or strongly supported increasing parking fees to generate £1 million, a measure now included in the budget to raise income while encouraging sustainable travel, but with discounts for York residents having listened to feedback from businesses;
• Council tax increase: While opinion was divided, over 40% of respondents supported or strongly supported the proposed 4.99% increase, helping to protect essential services like adult social care and children’s services;
• Visitor levy: Thinking beyond 2025-6, over 80% of respondents supported or strongly supported introducing a tourist tax in the future. This reinforces the council’s approach of exploring a visitor levy as a potential additional income source in the future.

These responses have directly influenced key budget decisions and underpins our prioritisation of adult social care and children’s services, protecting road maintenance funding, and raising revenue where appropriate. 

Ian Floyd, Chief Operating Officer, City of York Council, said: 

“Thank you to everyone who took part in the consultation process. Your feedback has been invaluable in shaping this budget.” 

Fees and charges to support sustainability 

The draft budget proposes a 5% increase in most fees and charges.  These charges are necessary for the council to continue delivering the same services, otherwise service cuts would be required. Increases to parking charges are also planned to encourage sustainable travel options while generating additional income to support essential services. These changes are designed to balance affordability for residents with the need to protect vital services. 

Addressing challenges and planning for the future 

While the 2025/26 budget provides stability and significant investments in critical areas, financial challenges remain. Rising demand for services, increasing costs, and a lack of clarity around future government funding require the council to plan for long-term service transformation. A comprehensive programme will focus on improving efficiency, embracing digital innovation, and targeting resources where they are needed most. 

The council is also reviewing major transport schemes, such as the York Outer Ring Road and Station Gateway projects, which are facing financial pressures caused by delays and previously high levels of inflation. These pressures have been exacerbated by factors beyond our control, such as the war in Ukraine. Updated proposals for the delivery of these schemes will be presented to the Executive as part of the ongoing capital programme review. 

Debbie Mitchell, Director of Finance, added: 

“This budget is a step forward, but we are not out of the woods yet. Our transformation programme will ensure we adapt and innovate to meet future pressures while continuing to deliver for the people of York. Additionally, we remain committed to managing infrastructure projects effectively, ensuring they meet the needs of our residents while staying financially sustainable.” 

Have your say 

The budget proposals will be discussed at the Budget Executive meeting on 21 January 2025, followed by a Budget Council meeting on 27 February 2025, where a final decision will be made. Residents are encouraged to attend these meetings or share their views in advance by visiting the council’s website. 

For more information about the budget proposals and upcoming meetings, visit: https://democracy.york.gov.uk/mgCalendarMonthView.aspx?XXR=0&M=1&DD=2025&ACT=Go