Agenda item

Officers introduced the report.

The Medium-Term Financial Strategy (MTFS) had been published just before Christmas, reflecting a challenging financial climate for local authorities, including Hillingdon. Primary cost drivers included rising demand for services; market pressure in social care and placements; and inflation that exceeded CPI inflation.

Central Government’s revised funding methodology had acknowledged that Hillingdon has been historically underfunded. Additional funding was forthcoming but would be phased over three years and will not be received until 2026/27.

It was noted that financial reserves had been significantly depleted in recent years to sustain services. Hillingdon cannot balance the budget without EFS. It was noted that EFS was not free money – it required Government approval and had to be repaid.

Savings identified within the report were owned by senior officers and services leads, and had been challenged through a series of ‘challenge sessions’ which included Corporate Directors, Cabinet Members and Finance colleagues. Savings were intended to be realistic, not aspirational. Some Directorates would be required to prepare detailed delivery plans, particularly for higher risk or high value savings.

A six-week public consultation was ongoing until early February before the budget is considered by Cabinet on 19 February and Council on 26 February.

The Committee welcomed the reported £12.13 growth and sought clarification on whether this came predominantly from the new fair funding allocation from Government (spread over three years) or relied on possible EFS. No specific growth item was attributed solely to either Government funding or EFS. The Council did not segregate sources of funding in that manner.

Members highlighted a saving proposed through “ceasing SEND key working” and asked for clarity on what would replace it, and how escalation to tribunals or complaints will be avoided. Officers clarified that the SEND key working service had already been discontinued this year. It was non-statutory. It was a ‘nice to have’ but not financially sustainable. An impact review had showed some impact but not sufficient to justify continuing. It was emphasised that families will not lose support as early help and SEND support was now embedded within the family help model; social care pathways; and a more integrated early-intervention structure. A small part-year saving had already been realised this year while the full year effect will materialise next year.

Members asked how confident officers were that the new proposals were realistic rather than aspirational. Officers noted that this year’s process was more rigorous than previous years. Service managers had been involved in the process. Growth was based on data, known pressures, and existing savings trajectories. Officers expressed high confidence but acknowledged some uncertainty inherent in social care demand. Monitoring will be continuous and monthly.

Members asked what impact growth in the Education, Health & Care Team will have. Officers advised that posts had been funded already through the capital transformation programme. This would enable establishment of an in-house tribunals team which was more cost-effective; more efficient management of increased caseloads; and improved ability to meet statutory EHC deadlines.

Members asked about the nature of the SEND brokerage role included in the growth proposals. Previously an agency role, the new growth funds a permanent brokerage officer to support negotiating placement costs; identifying appropriate and cost-effective settings for young people; strengthening commissioning intelligence; and monitoring placement quality and financial compliance. This role had recently been recruited.

Members asked about strengthening local provision and reducing out-of-borough placements, including how this will improve outcomes; how dependency on expensive out?of?borough placements will be reduced; and how this will be monitored. Officers highlighted several points in clarification: decisions were driven by ensuring value for money, quality of provision, improved outcomes through expanding in-house provision. On the fostering offer, new placements were reviewed regularly. There were continuous checks on suitability, outcomes achieved and financial efficiency. Governance structures included a Family Help Transformation Programme; strong partnership executive oversight; monthly outcome tracking; and external scrutiny from Ofsted and others.

Members asked about relationships between Directorates, and how leadership culture and staff capability were being aligned with these goals. The Corporate Directors of Children’s Services and Finance described a relationship based on high challenge and high support, transparency, and joint accountability. Directors described a clear vision, widely understood across services and partners; staff who are passionate, motivated and committed to positive outcomes; weekly internal leadership meetings (e.g., SMT); and strong communication across a 600-person workforce, all while ensuring that there was no compromise on what was delivered for young people. There was a strong vision across Children’s Services along with strong governance, high challenge and high trust. Officers asserted that better outcomes often correlated with lower costs. Evidence based decision making was being embedded throughout teams. Teams worked well together, find solutions together and celebrate achievements together.

It was noted that comments would be made to Cabinet, and that this budget was unlike others that had been considered previously. There were some unanswered questions about EFS and the deficit position at the end of the financial year. Officers were commended on their achievements but the comments should reflect being mindful of the unanswered questions.

Members thanked officers for their work.

RESOLVED: That the Committee:

1. Noted the draft revenue budget and Medium-Term Financial Strategy proposals for 2026/27 to 2030/31 relating to services within the Committee’s remit; and

2. Delegated comments to Council to the Democratic Services Officer in conjunction with the Chair and in consultation with the Opposition Lead