Dorset Council has published its draft budget proposals for 2026/27, revealing that the majority of new spending on social care and services will be funded through Council Tax rises rather than additional government support. The council plans to spend £482.6m running services next year – an increase of £18.9m on 2025/26. Around 60% of that total will be spent on care for elderly residents, vulnerable adults and children.
Council Tax is set to rise by 4.99%, made up of a 3% general increase and a 1.99% adult social care precept. For a Band D household, this equates to an extra £2.02 per week (£105 a year). Dorset already has one of the highest Council Tax levels in the country, with the average Band D bill for 2024/25 standing at £2,454, placing it among the top three local authorities nationally.
The draft budget papers show that Dorset Council’s Core Spending Power will increase by £25.9m in 2026/27. However, £24.1m of that – around 93% – is expected to come from Council Tax rather than new government funding, underlining the council’s growing reliance on taxing local residents to balance its books.
The council says this reflects longstanding unfairness in the way local government funding is distributed. Dorset serves a large rural and coastal area, with dispersed communities that are more costly to serve than urban populations, and an older demographic that places sustained pressure on adult social care budgets.
Cabinet Member for Finance Cllr Simon Clifford said Dorset’s rural nature, ageing population and transport challenges were not properly recognised by national funding formulas.
93% is expected to come from Council Tax, underlining The council’s growing reliance on taxing local residents to balance its books
‘Even though Dorset is a rural county, with the oldest population in the country and poor transport links, this is not recognised by government,’ he said. ‘Dorset deserves fair funding – but it is not getting it.’
Similar concerns have also been raised at a national level. Writing in his column for The BV this month, North Dorset MP Simon Hoare said: ‘There must be a clear rural dimension for funding formulas for schools, police, local government and the Environment Agency. Without it, we are in the fight with one hand tied behind our backs.’
Risk level ‘high’
The draft budget includes an additional £12m for adults and housing services and £5m for children’s services, alongside £1.7m to support children and young people with complex needs. Rising demand and inflationary pressures are cited as the main drivers of the increased spend.
Major capital spending is also proposed, including £8m to complete the new recycling centre in Blandford, £6m to complete major safety works at Dinah’s Hollow on the C13 in North Dorset and £7.7m for a new reablement centre in Bridport. Car parking charges are to be frozen for a further year.
However, the council’s own Medium-Term Financial Plan warns that the financial risks facing Dorset remain high. The report describes both the current and residual financial risk level as ‘high’, and confirms that future budgets are increasingly dependent on Council Tax rises, service efficiencies and outlined savings being delivered.
It also highlights growing pressure from special educational needs and disabilities (SEND) costs. Dorset’s Dedicated Schools Grant deficit is forecast to exceed £150m by March 2026, with servicing costs of around £5m a year.
While government accounting rules currently prevent the deficit from triggering insolvency, those protections are due to end in 2028. The proposed budget relies on a programme of savings through automation, service redesign, vacancy management and reduced back-office costs. The council acknowledges that failure to deliver these savings, or any further increases in demand-led services, would place additional strain on future budgets.
- The draft proposals will be scrutinised by councillors at the People and Health Scrutiny Committee on 21 January and the Place and Resources Scrutiny Committee on 22 January. Final recommendations will go to Cabinet on 29 January before being considered by full council in February.
- All budget papers are published on the Dorset Council website, and the full Budget and Medium-Term Financial Plan Strategy Report can be read here
