Piece Hall funding arrangement and collapse of The Shay stadium sale deal among the financial headaches facing Calderdale Council

Councillors also clashed over funding arrangements for the trust which runs Halifax’s historic Piece Hall, as they grappled with a challenging financial situation they agreed is “very serious”.

The scrutiny councillors heard the council spent £7.9million more than budgeted for in 2025-26 and although a balanced budget had been set for 2026-27, further savings of £3.2 million in 2027-28 and £7.6 million in 2028-29 would need to be found to balance the books.

Savings budgeted for will also have to be made, said finance officers.

Following the elections in which Reform UK took control of the council from Labour, new councillors were considering issues including impact on Council Tax levels, borrowing and debt, and the council’s cash reserves.

Coun Mike Payne (Reform UK, Sowerby Bridge), cabinet member for corporate services, assets and resources, said they were inheriting an over-run from last year of nearly £8million.

Finance officers had said a lot of these pressures related to adults and children’s social care costs which were impacting a lot of councils.

But Coun Payne said there were also holes in the budget relating to The Shay and The Piece Hall which could be added to that.

Coun Sarah Courtney (Lab, Hebden Bridge and Todmorden East) had asked what impact the collapse of the controversial deal to sell The Shay, home to football’s FC Halifax Town and rugby league’s Halifax Panthers, to Huddersfield Giants owner Ken Davy – would have. The deal is subject to a legal challenge from a group opposed to the sale

Ian Day, director of public services, said the net cost of running The Shay was around £500,000 a year.

Coun Payne said: “If we talk specifically about The Shay, that was regarded as a deal that had been completed – and there is nothing in the budget at all for next year to cover anything in The Shay and that includes capital expenditure which the stadium needs.

“There’s a deficit between revenue and expenditure of about half a million – that’s not in the budget at all, so you can add those in straight away.”

Coun Payne continued: “Neither is the expenditure of the grant for the Piece Hall, which was £1.2million spread over five years.

“So there are figures that aren’t included in this budget.”

Earlier, Coun Jay Shaban (Reform UK, Halifax Town), noting that almost 48 per cent of the council’s revenue came from Council Tax in 2026-27, asked what Council Tax increase assumption had gone into that figure.

Officers said that was the full 4.99 per cent, including social care precepts, and Coun Shaban said later: “It’s concerning we are looking at a potential maximum rise without a referendum just to balance the budget for next year.”

Coun Payne said the prediction of a £3.2million deficit in 2027-28, and noting this also assumed a Council Tax rise of 4.99 per cent, gives an even bigger out-turn.

And also referencing The Shay and Piece Hall issues, he said: “It’s historic – we are inheriting a situation where there was nearly £8million over-run on the budget and there are predictions of future over-runs as well in the next two years without those items of expenditure, capital and revenue put into the budget.

“This is a very serious situation that we face.”

Coun Courtney challenged the assertion over the Piece Hall.

She said there had been an ongoing commitment that was in the budget for funding the Piece Hall through its service level agreement (SLA).

“I thought the £1.2million over five years actually represented a reduction in what we have been giving to the Piece Hall through its SLA.

“The SLA, it isn’t just about giving them money, it’s about securing community use and also it’s our asset ultimately because it’s still owned by the council, it’s just on lease to the Piece Hall Trust.

“It’s in our interest to make sure that it is run properly and securely – my understanding is there was money in the budget for the Piece Hall because that had been an ongoing thing,” she said.

Members agreed with overview and scrutiny committee chair, Coun Mederic Payne (Reform UK, Salterhebble, Southowram and Skircoat Green), who suggested the SLA arrangements be reviewed.

Coun Ashley Evans (Lib Dem, Warley) agreed on the budget situation: “There are serious problems – we’ve got to try and address them in the next 12 to 24 months, otherwise we are going to be in a very, very serious situation.”

Coun Tom Garnett (Reform UK, Greetland) asked if the deficits predicted for the next two years were due to the Government’s Fair Funding Review or other factors.

Officers said it was a combination of both – the Government’s three-year settlement offered some certainty for mid-term planning.

They had some good news for councillors in that Calderdale may potentially get back around £36million from Government for some specific special educational needs and education (SEND) costs which have been a long-term issue for this council and many others.

But that would also leave £4million of that £40million SEND spend accumulated by the end of 2025-26 to be found and still uncertainty about future arrangements for these costs, although Government recognised there was an issue, officers said in response to a question from Coun Andrew Varley (Reform UK, Sowerby Bridge).

Answering a question from Coun Mederic Payne about use of reserves, officers said they were at a level where they did not want them to go any lower and they should be increased, with budget provision made for £700,000 to go into them this year and £1million in each of the next two years.

The trajectory was that spending had to be controlled, said officers.