Agenda item

Officers introduced the Budget & Spending report, which covered the 2024/25 outturn position and the 2025/26 month 4 position.

In the previous year, services in this Committee’s remit had experienced an overspend of £2.5 million, primarily due to increased costs in children’s care placements and pressures on Section 17 budgets, often related to accommodation.

Some anticipated savings, particularly those linked to the fostering offer, had been delayed due to the time required to recruit and assess new foster carers. These savings had been carried forward into the current year.

Other savings, especially those reliant on income generation from services such as the music service and adult learning, had not been achieved and had been written off.

For the current year, at month four, similar pressures persisted. There had been no significant increase in the number of children entering care, but a notable rise in the cost of care placements. On the Council’s residential project, part of the Care Offer savings plan, a further twelve beds were expected to be registered soon. This expansion was anticipated to bring the savings plan back on track.

Officers noted that while some savings were rated as ‘amber’, many were on track and would likely move to ‘green’ in month 5. The main risk identified related to the Charville residential site and the Care Offer, which depended on timely registration and occupancy of new beds.

Members queried the impact of savings plans on the quality of early years and music services. Officers responded that work was ongoing, with a focus on wraparound and sufficiency. The music service review had shown that pressures were due to overestimated income rather than overspending. There was a new Head of Music, and efforts were underway to modernise the offer.

Members commended the tables in the report as very informative, and asked about the sustainability of using capital receipts to offset overspends. Officers explained that transformation capital had been used for several years to support major programmes, such as the expansion of care provision, and that this approach was in line with government policy, with Government confirming this policy as a funding mechanism for transformation activities for the next five years. Officers reassured the Committee that the Council’s asset base continued to grow despite disposals. Officers also commended the education team for reducing the in-year DSG deficit.

Members raised concerns about overspending on accommodation, particularly in relation to temporary accommodation pressures. Officers clarified that there was a distinction between accommodation for care leavers and temporary accommodation for families, noting improvements in sufficiency for care leavers and ongoing work to address pressures in both areas. Officers also highlighted the Staying Close project for care leavers. There had been a reduction in the number of young people in semi-independent accommodation.

Members asked about plans to address the DSG cumulative deficit, which stood at £65.6 million. Officers acknowledged the challenge, noting that while the in-year deficit had reduced, the long-term recovery plan depended on upcoming SEND reforms and continued lobbying of government. The Council was actively engaged with the DfE and pan-London networks to advocate for fairer funding. The focus was on meeting the in-year budget.

Members asked if any resources had been specifically allocated to the education needs of families in temporary accommodation as a result of destitution. Officers confirmed that this was not the case, though the issue was recognised and had been raised in feedback on local government funding formulas.

Members asked about barriers to savings plans for the Stronger Families programme and fostering offer. On fostering, this was about lead-in times for recruiting foster carers. The Stronger Families programme was about the reduction of children coming into care and evidencing this. Improved tracking measures had since been implemented.

Members asked for an update on the Safety Valve agreement. Officers stated that the Council was awaiting government guidance on the future of the agreement and any additional payments, with modelling underway for various scenarios.

Members discussed persistent patterns of overspending in children’s social care, attributed to rising placement costs and market pressures. Officers outlined efforts to expand in-borough provision, including fostering, residential, and Staying Close projects, and emphasised the importance of supporting children to step down from residential to family-based care.

Officers highlighted progress in reducing out-of-borough placements, with significant investment in local provision and positive outcomes in keeping young people in the borough. This included developing Designated Units and SRPs. Other developments included Pinn River and further developments at Meadow High School. Work was ongoing on EBSNA to try to prevent issues from escalating.

Members asked about ongoing work with schools to improve early intervention and prevention. Officers noted that primary schools tended to be more inclusive than secondary schools, and noted initiatives such as the Centre for ADHD and Autism project to prevent placement breakdowns. Inclusion was expected to be a key element of upcoming SEND reforms.

The Committee also discussed SEND transport costs, which were reported to be on budget for the current year.

RESOLVED: That the Committee:

1. Noted the 2024/25 outturn position; and

2. Noted the 2025/26 Month 4 budget monitoring position