Agenda item

Consideration was given to a report which detailed the financial position for the Revenue Budget at the end of July, 2017 based on actual costs and income for the first four months of 2017/18 and forecast for the remainder of the financial year.

It was reported that, as at July 2017, the Council had a forecast overspend on General Fund of £3.4m. The majority of the £24m budget savings approved within the 2017/18 were being achieved, with £11.9m of those savings being Directorate budget savings. However, it was reported that, in addition to those budget savings, Directorates also had to achieve £5.4m of budget savings in 2017/18 which were agreed in previous budgets. Total Directorate savings for 2017/18 therefore were £17.3m. The current position indicated that around £5.2m of those total savings were at risk of not being achieved in the current financial year (and were reflected in the current overspend projection).

It was further reported that work would continue to identify alternative or additional savings in order to maintain a balanced budget position. Management actions would also continue to address areas of overspend. The overall budget position would continue to be monitored closely with regular updates on progress in maintaining a balanced budget position reported regularly through financial monitoring reports.

The forecast overspend should be set against a backdrop of the Council having successfully addressed cost pressures of £138m over the last 6 financial years and having to save a further £24m in the current year and to deliver an additional £42m in efficiencies and savings in the following two financial years in order to balance the Council’s General Fund Revenue Budget by 2019/20.

It was noted that a significant in-year pressure of £6.460m on the Dedicated Schools Grant (DSG) High Needs Block continued to be an issue. A recovery strategy set in place last year would, however, resolve £3m of the deficit and mitigate the in-year pressure through a series of measures including: a revised Special School funding model; a review of high cost out of authority education provision with a view to reducing cost and moving children back into Rotherham provision where possible; and a review of inclusion services provided by the Council. Whilst the pressure would not directly affect the Council’s financial position, it was considered imperative that the recovery strategy was implemented in order to address the position and avoid any risk to the Council in the future.

Control over spending was critical to maintaining a robust Medium Term Financial Strategy and avoiding unplanned spending impact on the Council’s reserves. All services would continue to develop mitigating actions and alternative savings to compensate for financial pressures and delays in delivering the full amount of savings.

Discussion ensued with the following issues raised/clarified:-

·                Some of the savings achieved during the financial year were not achieved in the areas as previously agreed as part of the budget exercise.

·                Savings would not be achieved due to the delay of the Phase 2 restructure of Early Help.

·                Work was taking place on “fine tuning” the joint ‘Fusion Centre’ bid for Government funding.  There was still confidence that the Children’s element of the bid would be successful, but this could be affected by any Government Ministerial post changes.  If unsuccessful it would have to be managed through normal services but with consideration as to how compliance would be achieved, the length of time to process work, statutory thresholds.

·                Where the NCA had concerns these were thoroughly investigated to ensure protection of the children concerned.

·                The money being sought through the bid was nowhere near enough for what would have to be put into services.

·                Currently there were insufficient education placements for the children with significant needs.  The Sufficiency Strategy was under review aiming to better map children with significant educational needs and with a view to the commissioning of additional placements.

·                The consultation on the Early Years restructure would commence in January, 2018.  The estimated cost of the delay was approximately £175,000.

·                The further delays on achieving budget savings were in respect of Care Enabling within Extra Care Housing and the review of Rothercare and Assistive Technology provision.

·                Savings to be re-profiled to ensure they were achieved and where this was not possible plans put in place to ensure savings were achieved from other projects or new pieces of work.

·                Numbers of children in high cost out of authority education provision.

·                Sufficiency strategy and special education provision.

·                Pupil projections and the numbers of available places.

·                Consultation process for Early Years commencing in January, 2018.

Resolved:-  (1)  That the current forecast overspend for 2017/18 of £3.4m be noted.

(2)  That management actions be noted and they continue to be developed to address areas of overspend and to identify alternative and additional savings to mitigate shortfalls in achieving planned savings in 2017/18.

(3)  That the detailed Dedicated Schools Grant (DSG) Recovery Strategy be noted which will transfer £3m in 2017/18 to reduce the forecast High Needs Block deficit and mitigate the in-year pressure through a series of measures has been set in place.    

(4)  That the current forecast outturn position on the approved Capital Programme for 2017/18 and 2018-2022 be noted.