About our budget

When we spend money, it generally falls into two main categories:

1. Capital expenditure.
2. Revenue expenditure.

Understanding the difference helps explain how your local services and infrastructure are funded and maintained and may help explain why we spend our money in the way that we do.

Capital expenditure - investing in the future

Capital expenditure is money spent on things that will last a long time and bring value to the community over many years. These are usually big, one-off investments in physical assets.

Examples include:

• projects such as upgrading the seafront and pier, coastal defences, public spaces, and transport links to boost tourism and local pride in Southend
• buying property for council use for example buying houses to help us meet the housing needs of our community
• building or refurbishing a building/asset such as council housing or schools

A bit like buying a house or a car, it is a large upfront cost, but it provides long-term benefits.

How capital expenditure is funded

We use a mix of funding sources to make projects happen. The funding is specific to a particular project and can only be used to fund this type of expenditure.

Government Grants

We apply for funding from national schemes like the Levelling Up Fund and are given funding from Government departments for example: from the Department for Education for High Needs Provision and from the Department for Transport for Active Travel.

Contributions from third parties

We may receive funding from external bodies or from developers within the planning rules, to improve transport or other aspects of the city.

Capital Borrowing

Like a mortgage, we can borrow money to fund major projects and repay it over time. This is only done when there is a strong business case and the project fits in with our priorities.

Asset Sales

We may sell unused land or buildings to raise money for new investments and reduce ongoing maintenance costs.

Ringfenced Funds

Some funds are specifically allocated for certain types of projects, such as housing.

To give an example:

• the Cliffs Pavilion
• Leigh Port
• Marine Parade/City Beach

projects are being funded through a combination of government grants via the Levelling Up Fund and Council investment.

These funding sources are separate from our day-to-day budget, which is used for services like waste collection, social care, and libraries.

Revenue Expenditure - day-to-day running costs

Revenue funding is what keeps services running every day. Unlike capital funding, which builds things, revenue funding pays for the people, supplies, and utilities that make those things work.

Examples include:

• paying staff wages
• running libraries, waste collection, and street lighting
• day-to-day support for schools, early help services, and Children's safeguarding
• adult and children's social care - he largest part of our budget, supporting people with complex needs
• public health services - local health initiatives, mental health support, and community wellbeing programmes
• maintaining parks and public buildings

This is more like paying your household bills, necessary to keep things going, but not something that builds new assets.

How revenue expenditure is funded

Revenue funding is made up of a range of different funding streams. Here are the sources and descriptions:

• Council Tax - paid by local residents based on property value
• Business Rates - also known as non-domestic rates- a tax charged on properties used for business purposes in the UK
• Government grants - funding from central government, including general support and specific grants for services like education or public health
• Service Charges - fees for certain services, such as garden waste collection and parking
• Reserves - like a savings account reserves are used to smooth out unexpected costs and fund exceptional items

How much public money does the council get?

We are proposing a net budget of approximately £201.6 million for the year from April 2026 to March 2027 to provide services made up of the elements above.

This is to be spent in the following way:

• Infrastructure and Corporate Strategy: £7.1M (3.5%)
• Housing and Planning: £5.7M (2.8%)
• Business, Culture, Music and Tourism: £7.9M (3.9%)
• Children, Learning and SEND: £57.3M 9 (28.5%)
• Climate, Environment and Waste: £24.7M (12.3%)
• Community Safety and Regulatory Services: £11.3M (5.6%)
• Finance, Assets and Public Transport: £10.5M (5.2%)
• Regeneration and Law and Governance: £5.3M (2.6%)
• Social Care and Healthier Communities: £66.1m (32.8%)
• Corporate: £5.7M (2.8%)

The remaining budget is used for things like:

• levies
• borrowing costs
• income on investments

All councils need to keep some money in reserves. This is a statutory requirement. Like a household's savings account, reserves can be used in emergency situations that have not been planned for in the normal budget.