Budget Summary

Financial Context

Prudent financial management is one of the key foundations of any organisation and this is even more important with a public service such as the police.

As the PCC it is my responsibility to ensure that the Force not only has the resources it needs for the current year but is also financially sustainable beyond. This means not only addressing current pressures and demands but also considering the longer-term viability of those actions.

As PCC I have overall responsibility for the finances of the PCC Group, which comprises both the Force and my office. This not only includes setting the overall budget for the group but also the level of council tax increase required to pay for it, within Government limits.

99% of the money I receive from Government and residents I give straight to the Chief Constable for the Policing services across the County.

Of the remaining 1%, just over half is used by my office to commission services to support victims of crime and community safety initiatives.

The remainder is used to support me in my statutory role which includes scrutiny of the Force, policy development, audit and engagement with residents.

My office also does a considerable amount of work bidding for additional Government funding for the whole of Surrey, and this is set out in Section 5 of this document.

Looking back to 2024/25

During the year I received quarterly updates on the financial performance of the Force to ensure that Chief Constable’s expenditure was in line with the budget I had delegated to him.

I also monitored my own office to ensure it remained within its budget.

In February 2024, I approved a revenue budget of £309.7m for the Group. Over 80% of the budget was used on staffing and related costs, with the remainder on supplies and services such as forensics, IT, repairs, fuel, uniforms and vehicles.

This year was particularly challenging with pressures on pay and costs. I supported the pay increase awarded to officers and staff by the pay review body during the year but was disappointed that the grant received from Government did not cover the whole cost.

Historic inflation, particularly in areas such as IT, continued to present challenges.

As the Force increased its productivity, driven by the Chief Constable and I, the demand for services, such as forensics, continued to increase.

Officer and staff shortages were covered by overtime so as to maintain services but again this came at increased cost.

That said, on the positive side, the savings target for the year of £3.8m was exceeded by £1.4m, additional income was realised from mutual aid and secondments, my office was successful in attracting funding during the year, the uplift target was met thereby ensuring no grant was clawed back, and costs pressures were absorbed where possible through greater efficiency and procurement.

Overall, this enabled the group to finish £0.3m under budget, equivalent to 0.1%.

£12.7m of revenue funding was used to fund the capital program as no capital funding is received from Government.

This was used to purchase assets, such as vehicles, as well as to improve the estate which I as PCC am responsible for.

The Force has an ambitious estates programme to deliver over the next few years, of which the new HQ is just part of, and therefore I have been setting funds aside from asset sales to enable me to deliver this whilst minimising the level of borrowing required to fund it.

Looking forward to 2025/26

In February this year, I set a total group budget of £329.3 million for 2025/26. This represents a 6% increase on the previous year.

Around two-thirds of this rise is due to pay and national insurance increases for officers and staff, with the remainder needed to cover inflation-related cost pressures.

While the Government did provide an additional grant to help meet some of these expenses, it was, as in previous years, assumed that the remainder would be funded through local council tax contributions.

Government funding announcements continue to include an expectation of the maximum allowable Council Tax rise.

Therefore, with regret, I made the difficult decision to increase council tax, rather than require the Force to find further savings on top of the £3.6 million already built into the budget to ensure it would balance.

The Chief Constable made it clear to me that he wanted as much resource as possible to help deliver his ambitious vision for the Force and I will be holding him to account on this over the coming year, ensuring effective use of the funding provided.

I also have a statutory duty as PCC is to ensure that there are adequate services in place to support victims and witnesses of crime.

The increase in the number of charges made by the Force, which I welcome, coupled with delays in the criminal justice system has meant that we have an unprecedented number of victims and witnesses that we need to support.

It is vital that support is provided to enable these individuals to testify in due course to secure convictions and take dangerous individuals off our streets.

I therefore decided for the first time to use £0.5m of the precept increase to fund these vital services.

Further information about services commissioned by my team can be found in Section 5 of this document.

Looking beyond 2025/26

I have a duty to residents to ensure that the Force can continue to provide services to protect them, and for that to happen it has to be financially sustainable.

The Medium-Term Financial Forecast (MTFF) is one of the key planning tools that helps identify available resources and options for delivery of my Police and Crime Plan and the National Strategic Policing Requirements.

The MTFF indicates that savings of over £18m are required over the next four years.

Surrey is looking at several ways to do this, including:

• Investment in technology to deliver efficiencies in processes
• More joint working in areas such as contact and criminal justice
• Joint procurement with other police forces and public bodies to drive down costs in areas such as uniforms, vehicles and insurance.
• Using AI and other tools to streamline processes and lower costs
• Ensuring that the Force estate can meet the needs of the 21st century by having fewer but more efficient and modern buildings

These alone however are unlikely to meet all the savings required, especially as this comes on top of the £90m of savings already delivered.

As a result, work is being done to review the Force operating model, which has not been done for 10 years, to look at how it can be structured to give better outcomes are a reduced cost.

Finally, unless Government grant funding is increased in line with rise in costs, Council Tax increases will be required to balance the budget and maintain services.

With regard to unplanned expenditure, such as a large operation or disturbances, I as PCC hold reserves to act as a contingency to enable these costs to be covered at the time they are required.

This is because there is no mechanism for these costs to be covered by Government, at least initially, nor is it possible to borrow the money for them either.

As the owner of the Force estate, I need to not only make sure it can meet the needs of officer and staff but also ensure that the investment is prudent.

I am putting money raised from the sale of surplus assets in to reserves to be used to fund these improvements and thereby reducing the level of borrowing required.

In common with most of the public sector Surrey Police is experiencing costs and demand rising at a faster rate than resources leading to some real financial challenges over the next few years.

Both the Chief Constable and I recognise the difficulties that this will present but we are both in agreement that everything should be done to ensure that the impact on the frontline and hence the services residents receive is minimised.

See more information about Surrey Police finances.

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