Agenda item

(To receive a report from Tony Warnock, Head of Finance, Children's and Specialist Services, which invites the Children and Young People's Scrutiny Committee to consider a report on Children's Services budgets for 2013/14 and 2014/15.  The views of the Scrutiny Committee will be reported to the Executive prior to finalisation of the 2014/15 budget proposals for the full Council's consideration in February 2014)

Consideration was given to a report by the Executive Director of Children's Services, which invited the Children and Young People Scrutiny Committee to consider a report on Children's Services budgets for 2013/14 and 2014/15.

The views of the Scrutiny Committee would then be reported to the Executive prior to the finalisation of the 2014/15 budget proposal for full Council consideration in February 2014.

The Executive Director advised that overall, Children's Services remained on course to deliver £27.5m of savings in full and on time, despite the continued growing pressures around children's social care. In the fourth year of the Comprehensive Review, the savings target for 2013/14 was £5.113m and although there was a degree of uncertainty around the budgets for social care and home to school/college transport, the Departmental Management Team remained confident that this year's savings would be delivered in full.

It was reported also that the savings target for 2013/14 had been increased from the original Comprehensive Review saving target of £1.782m to help respond to the reduction in the Early Intervention Grant and the conversion of schools to academy status.  It was noted that in recent years, Children's Services had managed to carry forward an underspending of 1% which had provided a welcomed degree of flexibility to respond to a number of small, one-off budget pressures that tend to emerge.  Despite all the uncertainty Children's Services remained confident that an underspending would arise at the end of the financial year.

The significant budget pressures for 2014/15 were:

·         Insurance costs – As a result of high value claims, insurance costs had risen steeply over the last few years.  Despite re-aligning other budgets, a shortfall of £0.197m was still expected next year;

·         Budget pressure relating to frontline social care.  It was highlighted that Children's Services was experiencing a greater demand on child protection services.   Caseloads had increased by over 30% from 2,842 in 2008 to 3,802 in 2013.  As a result of work pressures, it had been proposed to increase the number of social workers and that the Council had been requested to make available additional funds to address this.  The estimated cost for this would be £0.403m; and

·         That the Council had been requested to fund the additional part-year transport costs of £0.1m which was expected to arise when the Lincoln's new University Technology College opened in September 2014.

Other unquantified budget pressures for 2014/15 included:-

·         Out of County residential care – Due to identified pressures, budgets had been re-aligned and £0.193m had been added to the budget in July 2013. It was noted that there had been an increase in the number and complexity of out of county placements;

·         Special Guardianship Orders – Due to changes in legislation there had been an increase in the number of orders which required placements with friends and relatives to come 'under looked after' status. 2012/13 saw an increase of 30 orders and in the current year there had been a further 12;

·         Social Care Regulated Services -  There had been an increase in the number of Regulation 24 payments and, out of county fostering placements;

·         SEN Code of Practice – It was highlighted that due to impending legislation changes, there would be radical changes to the learning difficulties and disabilities system in England from September 2014;

·         Raising the Participation Age – The Local Authority's aim was to secure 100% participation in post-16 education and training; and

·         Troubled Families – It was reported that the Government had indicated that the scheme would be extended in 2015/16 and that it would be providing 40% of the funding. The Local Authority and partner agencies would be expected to finance the difference up front which would create a significant challenge.

Full details of the saving requirements and proposals for delivering the revenue savings for 2014/15 were detailed in the report.  The Executive Director made particular reference to:

·         2013/14 efficiencies, for which various savings had been identified as a result of the budget setting exercise which totalled  £0.305m;

·         Part of the short break development initiative relating to children with disabilities had ceased delivering a proposed saving of £0.019m;

·         Fees for the CfBT management had been re-profiled making a proposed saving of £0.203m;

·         The phasing out of the essential care user allowance, creating a proposed saving of £0.197m;

·         A review of Connexions buildings, giving proposed savings of £0.050m;

·         The dis-establishing 4 ftes (Early Years Sufficiency Team) plus reduction in grants – which would deliver proposed savings of £0.634m;

·         The Food in Schools Team (2 ftes) being transferred to Public Health.  It was highlighted that the budget would not be transferring which created a saving a proposed saving of £0.057m;

·         A reduction in the number of transport days per annum from 195 to 189 transport days over the next two years giving a proposed saving of £0.748m; and

·         Extended provision transport costs.  Proposed savings of £0.250m.

In conclusion, the Executive Director advised that the Directorate had worked extremely hard to manage internally a number of budget pressures, through reducing costs and re-aligning budgets, and the £2,636m savings target for 2014/15 could be delivered by the proposals detailed in the report presented. However, a request had been made for the Council to fund investment in front line social care work (£0.403m) and the transport costs for the University Technology College (£0.1m).  Looking ahead, the financial outlook for 2015/16 was that the Council would be required to make very significant savings again.

Supporting documents appended to the report were:--

·         Appendix 1 – Children's Services current non Dedicated Schools Budgets 2013/14; and

·         Public Health Budgets relating to Children's Health 2013/14.

During discussion, the Scrutiny Committee raised the following issues:-

·         Business mileage savings – The Committee was advised that following consultation, the buying out of the essential car user allowance had been agreed, which had resulted in the savings;

·         Staff reduction – The net effect on staff was as per pages 6/7 of the report, namely - the dis-establishment of the Property and Technology post and the four fte's from the Early Years Sufficiency Team.  It was noted that some of the four fte staff would be redeployed;

·         Increase in funding for social care front line staff – The Committee expressed their support for the extra funding.  It was noted that it is council policy that 1% of underspends could be carried forward to the following years budget;

·         The impact of Free School meals on the budget.  It was noted that for the universal offer for free school meals the council had been awarded capital grant and would receive revenue into the dedicated schools budget – a proposed spend of the capital grant was under development;

·         Pupil premium – It was reported that this funding was additional to the budgets that schools receive from the Dedicated Schools Grant.  The government was planning to introduce a national, fair funding formula in 2015/16 and as Lincolnshire's funding was comparatively low at present, it was hoped that the county's share of national funding for schools would increase;

·         Cost of insurance – The Committee was advised that due to one high value claim, the cost of insurance had risen steeply over the last few years.  As a result external premiums had risen, and the costs of the insurance internally were recharged to each directorate.  It was noted that there was a degree of self-insurance by the Council, which helped reduce costs;

·         Home to School Transport – The Committee was advised that a report would be presented to a future meeting of the Scrutiny Committee.  It was agreed that the report should also include the effect of providing transport to the Technical College;

·         Troubled Families – The Committee was advised that the government provided £10,000 to turn a family round with a reward of £4,000 where work was completed.  Therefore the more success, the more money coming in; 

·         Out of County Placements – A question was asked whether the figure in the report included CAMHS (Child & Adolescent Mental Health Services).  The Committee was advised no, as CAMHs at Tier 4 was commissioned by the regional team not the Local Authority.    At the moment work was underway to look at the complex needs of Tier 3 cases;

·         The DfE's Section 251 benchmarking information relating to planned spending of safeguarding children.  Lincolnshire's planned spending of £136 per pupil compare to the England mean of £162 per pupil;

·         Carry Forwards – The Committee was advised that only 1% of underspends could be carried forward;

·         Performance Indicators – Congratulations were extended to Children's Services for being in the top quartile for many indicators.  Members were advised that further work was needed to improve exclusion figures;  Key Stage 2 narrowing the gap and Key Stage 4 narrowing the gap;

·         With regards to Appendix 2, the Public Health budgets relating to children's health, some discussion was held on the amount of budget for teenage pregnancies and whether the remaining budget would be spent in three months.  Some Members felt that they required further clarification in relation to the Public Health budgets and how much money would be available to take things forward to support the health part of Children's Services;

·         Concern was expressed regarding the SEN Code of Practice.  Members were advised that potential costs were currently unknown.  Lots of work was currently going on, and that it was hoped that the financial implications would be clearer by the end of March 2014.  The government had made available £75,000 of funding for the first year, with further funding of £75,000 promised for 2014/15 to help implement the reforms.  It was stressed that a communications plan was to be put into place for parents and carers.  Members were advised that children currently on a statement would stay on it for a while whereas any new applications in the next academic year would lead to the issuing of a health, education and care plan as opposed to a statement; and

·         Questions were raised as to when the Committee would have the opportunity to input into the fundamental review for 2015/16.  Members were advised that nothing had yet been agreed by the Corporate Management Board.

RESOLVED

That the Children and Young People Scrutiny Committee considered the budget proposals for 2013/14 and 2014/15 and offered the following comments to the Executive:

a)    Support for the proposed additional funds of £400,000 for social workers;

b)    Support for the additional capital of £200,000 for the foster care service;

c)    The Committee discussed the potential transport costs arising from the opening of the University Technical College and requested that the funding of these additional costs does not come from existing budgets;

d)    The Committee also discussed the integration of services around health, and questioned how much funding would be coming from health and whether there would be a pooling of budgets; and

e)      The Committee raised concerns over future financing for 2015/16 and requested early involvement of the Committee in the decision making process.