Kent Fire and Rescue Service
Budget Book And Medium-Term Financial Plan 2026/27 – 2029/30

Details of the Authority’s General Reserve and each Earmarked Reserve are given below:

General Reserve

Provides a contingency to cushion the impact of unexpected events or exceptional costs, and in extreme circumstances would be used to provide a working cash balance to cushion the impact of uneven cash flows to help avoid unnecessary temporary borrowing. For example, the general reserve could be used to fund an unforeseen loss on the Authority’s share of Kent District’s and Medway Council’s business rate collection funds. Within the 2026/27 Reserve Strategy, it is proposed that the level of General Reserve is set at approximately 5% of the Authority’s base revenue budget. The appropriateness of this level is assessed on an annual basis, through a detailed risk assessment. 

Earmarked Reserves

Sums specifically set aside not only provide funds to meet future known or predicted expenditure or liabilities, but also support the transformation of the service to ensure it is fit for the future. Earmarked reserves are typically used to smooth the impact on the revenue budget (and council tax) of expenditure that would otherwise cause significant fluctuations in the annual budget requirement, such as expenditure on the replacement of vehicles and equipment. Earmarked reserves are also of use where there may be plans to introduce a policy change or a service improvement which initially requires a one-off increase in expenditure for which additional resources are required, or where there is a future budget liability or pressure which is known, but for which the timing of payments or change in funding is uncertain. The purpose of each reserve is clearly defined, with regular reviews to ensure continued relevance and adequacy.

• Government grants - used to carry forward unspent government grants.
• Infrastructure - used to fund revenue and capital investment in infrastructure assets (premises, IT, vehicles, and operational equipment) and reflects funding for a significant programme of investment in these areas over the medium-term.
• Insurance and resource - used to smooth the impact of insurance claims volatility and the annual variability in legal costs incurred when enforcing building safety regulations. The reserve will also be used to fund any significant one-off costs that may arise in-year, for example for higher levels of inflationary increases, compared to that planned for in the MTFP or any other unforeseen significant cost increases which may arise after the budget is agreed. Future funding levels remain uncertain so this reserve may be used to temporarily balance the budget where there is a timing difference in cuts to funding and the delivery of budget savings. Funding will also be set aside in this reserve each year to fund the end-of-lease costs for returning the property leased for vehicle servicing and maintenance, to the state it was in at the start of the lease.
• Rolling budget - used to fund committed expenditure where the goods or services will not be received or delivered until the following financial year.
• Service transformation and productivity - used to help pump-prime new transformation initiatives or improvements to the Service which may arise in-year or be planned for future years. Also used to support collaborative initiatives with other blue light services and partner agencies.