Agenda item

Cabinet Portfolio:-                Corporate Services and Finance

Strategic Directorate:-          Finance and Customer Services

Consideration was given to a report which set out the financial position of the Council as at the end of September 2018, which was based on actual costs and income for the first half of the financial year with forecasts for the remaining six months of 2018/19.

It was reported that at September 2018, the Council needed to identify a further £3.1m of cost reduction actions by financial year-end in order to achieve a balanced financial outturn, after taking account of the £10m budget contingency approved within the 2018/19 budget. The overspending against budget in the Children’s and Young People’s Services directorate had continued in the current financial year as a result of demand for services outstripping budget capacity. The number of children in care had continued to increase and the forecast overspend on Children’s Services had increased to £15.7m.

The increased number of Looked after Children also placed significant pressure on Legal Services within the Finance and Customer Services directorate. The forecast overspend for Legal Services was £1.488m. The Finance and Customer Services directorate overall had forecast to outturn within budget after putting into place a range of mitigating actions to compensate for the legal service forecast overspend. The Adult Care, Housing and Public Health directorate remained on track to bring its overspend down to £6.221m. A combination of increased client numbers, the rising cost of care packages, and delays in delivery of savings plans had led to pressure on budgets across all client groups. A recovery plan had been developed to address previously undelivered savings and project plans were being finalised with the expectation that further savings would be identified from that activity. The Regeneration and Environment directorate had forecast a balanced budget, although it was facing challenges from a combination of declining business from the School Meals service and challenges with delivery of budget savings, including transport and property savings.

Members referred to the report stating that initial target levels of children in care not being achieved as planned and sought clarification as to who was monitoring and discussing progress and what was actually taking place. In response, officers explained that this did not mean that activities were not having the correct effect, but there were higher numbers of referrals to the Council. A significant number of senior officers from Finance and Children and Young People’s Services were analysing data and information, whilst the Chief Executive and Cabinet Members were also reviewing this on a regular basis to check that the service is doing what it should do and needs to do and then to check what else was happening beyond that which meant that the cost of the service was not reducing.

Further clarification was sought in respect of the delays in delivering savings from the Regeneration and Environment directorate. In response, it was confirmed that there was a rigorous process to monitor actual and approved savings. Where savings had not been delivered they had been mitigated and alternative actions.

Members queried how many children had been estimated to be referred to the Council for the current financial year. In response, it was confirmed that a budget was in place for between 460-480 children, yet the current figure was 657 looked after children. Following on, Members queried how many looked after children were being budgeted for in the 2019-20 financial year. In response, officers explained that the Medium Term Financial Strategy was in the process of being updated, however the service did not expect to see a significant reduction in numbers. Members then sought clarity in respect of the impact on the budget if spend continued to rise or be maintained its current level. In response, officers explained that financial figures were based on what was happening with the service. In broad figures, the cost per looked after child varied between £40-50k per child, and with approximately 200 more children in care than some years ago, that represented a significant increase in cost. Ultimately, if children needed to be protected, the authority had a statutory duty to provide that protection. With regard to the budget, this would mean a further reduction of budgets for other Council services if it continued, however work was ongoing to ensure that a balanced budget could be set.

Members accepted that it takes time for children to progress through services and therefore the savings to be accrued will take time to be realised, so it was not surprising that targets were initially missed. Assurances were sought that savings would be followed up, even where initiatives were not progressing to timescale, to ensure that they reach their target. Officers confirmed that there would always be opportunities to improve the process of following up on savings delivery. Within Children and Young People’s Services, numbers are planned and monitored, however it is the unpredicted demand which had caused problems.

Members referred to progress in respect of customer and digital services and the use of vacancy management. Reflecting the experience of the roll out of new green waste bins, it had caused questions to be asked around whether big service changes could be met as residents had been unable to get through to the Council. In response it was acknowledged that work was ongoing to better understand and anticipate demand for services.

Resolved:-

That the Cabinet be advised that the recommendations be supported.