Highlife Highland Returns to Normal Financial Operating After Covid Support Ends

27th February 2026

In the 2026/27 budget proposals, The Highland Council plans for High Life Highland (HLH) to return to a sustainable financial model following its post-COVID recovery period.

The key changes and expectations for HLH in the 2026/27 financial year include. -

End of Deficit Support: The 2026/27 financial year is projected to be the first year since the pandemic that HLH will operate without additional deficit support from the Council.

Operating Within Recurring Revenue: HLH is expected to return to operating strictly within the budgeted recurring revenue support provided through its standard Service Delivery Contract with the Council.
Rebuilding Reserves: HLH forecasts achieving a financial surplus during 2026/27, which will allow the charity to begin rebuilding its unrestricted reserves toward a 3% target.

Leisure and Arts Improvements: Broader budget proposals for 2026/27 include planned improvements in leisure and arts services, alongside "invest-to-save" projects designed to increase energy efficiency across council-linked facilities.

New Strategic Plan: A new Business Plan covering the period up to March 2030 is currently being prepared to guide HLH's long-term objectives and financial sustainability.

These proposals are part of a wider £868 million budget for 2026/27, which includes a proposed 7% Council Tax increase to address a projected £16.3 million budget gap and fund core services. The final budget decisions are scheduled to be considered by the Council on 5 March 2026.

High Life Highland (HLH) is a registered charity and company limited by guarantee, created by The Highland Council to deliver services like libraries, museums, leisure centres, and sports. As an "arm's length" organization, it operates independently but is wholly owned by the council, allowing for more efficient management, tax benefits, and focused service delivery.

Key Aspects of High Life Highland's Role:
Structure: It is a separate legal entity from the council, which allows for different operational flexibility.

Purpose: It was established to manage community, culture, and sports services.

Functions: HLH operates 70 libraries, numerous museums, including the Highland Folk Museum, and 22 leisure centres.

Relationship: While it operates independently, it is still owned by the Highland Council and works on its behalf.

Why an "Arm's Length" Trust?
Efficiency: It enables the organization to focus solely on service delivery rather than being part of a larger bureaucratic structure.
Tax Benefits: As a charity, it can access financial advantages not available to local authorities.
Flexibility: It allows the trust to be more responsive to user needs and to manage its own staffing and budget.