Shropshire Council told that full financial recovery must be made by March 2029

Shropshire Council has been told that full financial recovery must be made by March 2029.

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Grant Thornton has issued its interim auditor’s annual report, which mainly takes into account the 2025/26 financial year when the budget was set by the previous Conservative administration.

The auditor said the council faced significant financial sustainability and delivery risks during that period, which it said was due to a poorly constructed budget, a failure to deliver planned savings, and weak financial management arrangements.

The scale of the challenge resulted in the newly appointed Cabinet to declare a financial emergency in September 2025, introduce spending controls, and seek substantial emergency financial support (EFS) from central government.

However, although the council has made progress to strengthen financial management and reduce the projected EFS, Grant Thornton says it remains exposed to significant financial risks and it has a substantial medium-term funding gap.

A total of 12 recommendations have been made, including two statutory ones.

The auditor says the council must make significant progress by March 2028, with full financial recovery by March 2029.

It must also “get a grip” on its corporate governance to improve its internal assurance arrangements.

The report will be considered at a special full council meeting on November 5.

Councillor Heather Kidd, leader of Shropshire Council, said: “We will be open and transparent about Grant Thornton’s report. It sets out serious findings and recommendations, and we accept that the council must continue to change if we are to rebuild financial resilience, strengthen governance and deliver consistently for the people of Shropshire. 

“This report largely reflects the council’s position during 2025/26, under a budget set by the previous administration. Since then, we have taken significant action.

“EFS granted earlier this year has enabled investment in transformation and change.

“It is encouraging that the auditors recognise the early signs of recovery, including stronger leadership, improved financial grip and the progress delivered through our Improvement Plan. 

“We are not complacent. Reducing our reliance on EFS is one of the biggest challenges we face and will take sustained discipline, difficult decisions and transformation across the council.

“Our aim is to achieve a balanced and resilient financial position that protects essential services, delivers value for money and enables us to move out of the Best Value Notice as soon as possible. 

“We are now bringing all of the external recommendations into a refreshed Improvement Plan, with clear actions, milestones and accountability.

“The special meeting of full council will give councillors the opportunity to consider the report publicly, decide how to respond to the statutory recommendations and ensure that progress remains open to scrutiny.”