Agenda item

Officers introduced the report, noting that it was the third time this report had been presented to the Committee.

There had been an adverse movement of £200k, primarily due to the increased cost of care rather than an increase in demand. The Dedicated Schools Grant (DSG) had shown no further adverse movement, which was considered positive, and forecasting was described as accurate and robust at this stage.

Officers expressed confidence in the savings plan, noting that the vast majority of planned savings were expected to be achieved.

£273,000 savings remained under review, linked to increasing residential provision. Officers anticipated that, subject to Ofsted registration of the new provision, these savings would be achieved by the end of the financial year. Ofsted had visited the new provision, and the Council awaited their decision.

Members asked if the service area would need to declare a budget deficit for the next year, noting that savings had been made but offset by overspends, particularly in care costs. Members also asked about the plan of action leading up to December Cabinet and February budget. Officers noted that the situation was challenging, with the cost of care being the main driver of overspends. Officers were going through STAR Chambers, and efforts were ongoing to increase residential provision and to reduce costs. Regular meetings and proposals were in place to address the overspend, but the final budget position was still uncertain. Officers expressed reasonable confidence in reducing costs but could not confirm the final outcome at this stage.

Officers confirmed that the budget for 2026/27 was being prepared for Cabinet consideration on 18 December, with a further report scheduled for the Select Committee in January. There was uncertainty regarding government funding allocations, with final figures expected after the Cabinet meeting. This was typical of recent years and made it difficult to predict the budget position.

Members referred to the DSG overspend of £12 million and requested an audit of in-house SEND capacity and capital works, noting that a lot of work had been ongoing in this area. Officers advised that there was an annual update on the SEND Sufficiency Strategy upcoming, with capital projects underway, particularly in secondary provision.

Members also asked about progress on the inclusivity agenda and support for schools. There had been positive trends in mainstream placements and ongoing work with schools to support inclusion, including outreach projects, and work with the Centre for ADHD and Autism.

Members asked about feedback from the DfE regarding Hillingdon’s progress in reducing the DSG deficit. Officers noted that the Council had received positive recognition from the DfE for its financial efficiency and improved outcomes. While the safety valve project had closed to new Local Authorities, further information on payments and new programmes was expected. The Committee commended officers and the team for their achievements.

Members asked whether schools were delivering the same service with less money due to changes in banding. Officers explained that the new banding model, developed with school leaders and a specialist consultant, focused on group support, where appropriate, rather than one-to-one provision, which was no longer considered effective as the standard approach to support, and recognised feedback from young people who reinforced this. Funding per hour had increased, but the approach was more flexible and needs-based. Some schools had seen decreases in funding, others had seen increases, depending on individual needs. All children will have transferred over to the new banding by the end of the financial year, which would help with future planning. The transition had generally been well received by schools, though some out-of-borough schools had found it more challenging due to not being part of the development of the framework.

Members asked about the use of capitalisation to reduce overspend and plans to phase this out. Officers clarified that transformation capitalisation was used for activities generating ongoing savings. The government had extended the use of these powers to March 2028. The Council reviewed this provision often to ensure compliance and value for money, with ongoing review in line with government policy.

Members asked how the Council ensured that concentrating on in-borough provision did not dilute quality for vulnerable children. Officers advised that in-borough provision allowed for closer oversight and partnership with schools, leading to high standards. Independent provision did not necessarily equate to higher quality, and in-borough placements also reduced travel and maintained community links for young people.

Members asked about providing additional accommodation, including the distribution of children’s homes across the borough. Officers explained that location assessments were rigorous, considering safety, access to transport, and education. The needs of young people were always considered. Not all children could be placed in-borough for safety reasons. The current and planned provision was expected to balance the need for in-borough placements and reduce reliance on external providers, with benefits for children’s wellbeing and community integration. In-borough provision often mean young people can be closer to their school, GP and families.

RESOLVED: That the Committee noted the 2025/26 Month 5 budget monitoring position.