Author and Job Role: Kelvin Menon – Treasurer
Protective Marking: OFFICAL
Executive Summary:
The Financial Monitoring report for the first half of the year to the 30th September 2026 shows that Surrey Police Group is predicted to be £1.7m over budget by the end of March 2027 based on performance so far. This is based on a budget of £347.9m for the year. Capital is predicted to be £4.0m underspent based on a budget of £97.9m.
Financial Regulations state that all budget virements over £0.5m must be approved by the PCC. These are included within this decision notice.
Background
Revenue Forecast
The total budget for Surrey and the forecast outturn is set out in the table below:
| Surrey Group | 2026/27 Annual Budget £m | 2026/27 Forecast Outturn £m | Variance £m |
| Total 2025/26 Budget | 347.9 | 349.6 | 1.7 |
| Funding | (347.9) | (347.9) | 0.0 |
| Grand Total | 0.0 | 1.7 | 1.7 |
The £1.7m projected overspend is broken down by cost type as follows:
| 2026/27 Year to date £m | 2026/27 Annual Budget £m | 2026/27 Forecast Outturn £m | Variance £m | |
| Wages and Salaries | 135.1 | 274.3 | 277.8 | 3.5 |
| Premises | 6.9 | 13.8 | 14.8 | 1.0 |
| Transport | 2.7 | 5.8 | 6.2 | 0.4 |
| Supplies and Services | 21.7 | 42.7 | 42.2 | (0.5) |
| Capital Financing and Reserves | 0.8 | 16.8 | 15.9 | (0.9) |
| Grants and Income | (3.5) | (9.8) | (11.6) | (1.8) |
| OPCC | 3.5 | 4.3 | 4.3 | 0.0 |
| TOTAL | 167.2 | 347.9 | 349.6 | 1.7 |
The overspend has been driven by a number of factors. Both officer and staff vacancy margins have not been achieved leading to an increased headcount and costs against budget. Overtime continues to be an issue, although some of this is funded by grants and ill health retirements continue to grow. Utilities and fuel costs continue to rise and legal costs continue to be higher than budget. Some of this growth in costs has been offset by additional income from secondments and fees.
Capital Forecast
The total budget for the year comprises the approved budget for 26/27 plus slippage from the previous year and adjustments in year. This is shown in the table below:
| 2026/27 Year to Date £m | 2026/27 Annual Budget £m | 2026/27 Forecast Outturn £m | 2026/27 Variance £m | |
| ICT | 1.0 | 3.0 | 3.2 | 0.2 |
| General Estates | 0.1 | 6.6 | 1.7 | (4.9) |
| Estates projects | 1.8 | 79.2 | 79.3 | 0.1 |
| Vehicles and transport | 0.7 | 7.3 | 7.3 | 0.0 |
| Cost of Change | 0.0 | 0.2 | 0.4 | 0.2 |
| Operations | 0.4 | 1.6 | 2.0 | 0.4 |
| TOTAL | 4.0 | 97.9 | 93.9 | (4.0) |
Although an underspend it forecast this is in the main due to slippage in the plan rather than an actual underspend. The main variance in Estates is due to delays with the plant replacement, alarm and door upgrades. Given the current level of spend it is anticipated that there will be further slippage in the year.
Savings
The budget for 2026/27 included £5.4m of savings. £4m were taken at budget setting and a further £2.2m has been found subsequently. Unfortunately, £1.6m of new pressures have been identified leading to a savings gap of £0.8m.
Neighbourhood Policing Guarantee
The Government has set a target increase of 48 in Neighbourhood Policing numbers by the end of the year. If this is not achieved, then there is a mechanism to withdraw funding from Forces. As at the 30th September the target ahs been exceeded and the Force is confident the target will continue to be met at the 31st March 2028.
Virements
All the financial virements over £500k for approval from the PCC are set out below:
Revenue Virements
The virements over £500k made in Qtr. 2 are shown below
| Surrey Budget_Adjustments P4 – P6 Qtr 2 | Budget Movement | Budget Movement | Budget Movement | Budget Movement |
| Virement Movement Between Portfolios over £500k | Commercial and Finance Services | Funding | Local Policing (Surrey) | Specialist Crime |
| Perm Virements 2027 | ||||
| Virement 2516 – Sy Officer Sept 26 Pay Award Cost & Grant | 1,084 | (1,084) | ||
| Virement 2471 – Sy Op Solve Correction to Investigations Reallocation | (86) | 2,537 | (2,452) | |
| Virement 2465 – Sy Op Solve Public Protection Part 2 Reallocation | 87 | (1,179) | 1,091 | |
Capital Virements
The virements over £500k made in Qtr. 2 are shown below
| Capital Budget_Adjustments £000’s P4 – P6 Qtr 2 | Budget Movement | Budget Movement |
| Virement Movement Between Portfolios over £500k | Chief Operating Officer | Commercial and Finance Services |
| Perm Virements 2027 – None | ||
| Temp Virements 2027 | ||
| Virement 2508 – Estates Capital Slippage one sided virement | (1,000) | |
| Virement 2466 – Cost of change budget return virement | (2,833) |
Police and Crime Commissioner Approval
I note the financial performance as at the 30th September 2026 and approve the virements as listed.
Signature: PCC Lisa Townsend (wet signed copy held in Office)
Date: 5th November 2026
All decisions must be added to the decision register.
Areas of consideration
Consultation
None
Financial implications
These are set out in the paper
Legal
None
Risks
There were a number of financial risks which were set out in the budget paper. These will be monitored during the year.
Equality and diversity
None
Risks to human rights
None