Agenda item

Consideration was given to the report presented by the Finance Manager (Financial Services, Resources Directorate), which provided a financial forecast to 31st March, 2014, based on actual income and expenditure to 28^th February, 2014. 

Overall, the Directorate was estimating a £968,000 over-spend outturn position at the end of the 2013/2014 financial year.  This now represented a reduction of £156,000 since the January budget monitoring report. 

This over-spend position had increased since the time of writing the submitted report, when it was originally reported as £768,000 over-spent.  This was due to continuing discussions relating to the Academisation of Rawmarsh Community School. When the report had been written it was estimated that the School’s £100,000 deficit would be transferred to the Local Authority on the completion of their sponsored academisation.  It was known at this point that the deficit was higher but it was thought likely that the deficit could be reduced.  Following further discussions with the Headteacher and Business Managers of both Schools involved, it was now likely that the deficit would be approximately £300,000.  Robust financial management would be in place following the School’s academisation.  The Local Authority would monitor the budget on a weekly basis and the School would only be allowed to undertake essential spend on staffing, utilities and health and safety items.    

The forecast overspend was largely due to the continuing pressures in Safeguarding Children and Families’ Services due to the needs-led nature of the budget, Disability Services and the Directorate-Wide budget. 

The report provided an update on the main areas of variance and outlined the main pressures and areas of under-spend and/or over-spend for each Service.

A number of continuing budget management actions were being taken to avoid costs: -

·           Proactive management concentrating on avoiding costs relating to placements for Looked After Children, the Fostering Framework and through block commissioning and negotiation of placements was taking place.  These efforts had achieved savings of £714,000 to February, 2014;

·           The Multi-Agency Support Panel was continuing to make efficient multi-agency management actions and decisions, and continuing to avoid costs wherever possible;

·           The Invest to Save Programme in Fostering and Adoption Services was continuing to be effective and increase the number of in-house fostering placements and adopters;

·           Agency costs had increased compared to the same period in the previous year primarily as a result of covering vacant posts within Safeguarding Children and Families’ Service, and covering sickness absence and maternity leave to ensure that safe staffing ratios were maintained.  Recruitment was underway in relation to vacant posts to save on agency costs;

·           The recruitment of Social Workers and Team Managers was also considered.  The timescales involved often meant that posts could not be filled as soon as they became vacant.  However, the recruitment and retention of Social Workers was not currently uncontrolled or unpredictable in Rotherham.  The Department for Education’s data had shown that Rotherham’s turnover of social care staff and use of agency was one of the lowest in the region; 

·           Non-contractual overtime for Children and Young People’s Services had increased compared to the same period in the previous year as a result of the need for fully trained staff to maintain cover in residential homes.  Agency staff could not cover these posts due to training requirements and service-users’ need for consistency;

·           Consultancy costs had decreased compared to the same period in the previous year.

Based on previous Budget Monitoring feedback from the Cabinet Member, the January 2014 report contained a breakdown of the different placement types that existed for the years 2011/12, 2012/13 and 2013/14 to February, 2014.  The breakdown noted the number of out-of-authority placements that existed, the average placement cost, independent fostering agencies and in-house fostering placements. 

The report informed the Cabinet Member of current risks and uncertainties relating to the Service’s budget: -

·         The recruitment of in-house fosterers and adopters was a continuing focus for the Service, but these could only go forward if the quality of the placement was sufficient;

·         It was intended that placement costs were reduced, however, the decisions around selecting a placement were always made in the best interest of the child/children.

The Cabinet Member was disappointed that Children and Young People’s Services’ estimated over-spend position had once again increased after continued work had reduced it to £768,000.  He referred to the legislation that compelled local authorities to be responsible for the deficits of schools that were becoming sponsored academies and was mindful that the overall Children and Young People’s Services’ over-spend increase was due to Rawmarsh Community School not being able to reduce their budget deficit within the period agreed. 

Resolved: - (1)  That the latest financial projection against the budget for the year based on actual income and expenditure to 28^th February, 2014, be noted.

(2)  That a report be presented to a future meeting of the Cabinet Member for Children, Young People and Families’ Services outlining individual school’s budget monitoring reports.