Agenda item

To consider and note the latest monitoring position on both the revenue and capital budgets and seek agreement to changes to the capital programme cash limits.

Cabinet received a report providing the budget monitoring position for July 2015-16 for both revenue and capital budgets, including an update on key activity data and seeking approval of necessary changes to the Capital Programme.

Deputy Cabinet Member for Finance and Procurement, Mrs Susan Carey introduced the report, and in particular referred to the following:

      i.        The report contained information available to the end of July 2015 and the predicted final position for the 2014/15 budget; currently an overspend of £12.958million, following management action identified. 

    ii.        The Corporate Management Team had been tasked with urgently identifying further management action in order to deliver a balanced budget and would review areas of spend for reduction that would not affect front line services.

   iii.        Each Directorate had significant pressures to which Ms Carey referred in turn, contained within the report, at para.3.6 and included asylum costs, increased demand for adult social care services, increased waste volumes and higher levels of emergency highway repair than predicted.

In relation to the Capital budget Ms Carey made the following comments:

      i.        That the working budget for the 2015/2016 capital budget was £367million and included the usual rephasing of projects.  Once this rephasing had been taking into account most projects were in time and on budget.

    ii.        ‘Real’ variances were contained in section B of the report and related to additional costs on the Trinity School build, some highways work and the Incubator Development are all of which would be met by contributions from other agencies. 

   iii.        Rephasing to which she drew particular attention included

a.    Special School review which had been rephased to reflect delays at the planning, acquisition and cost renegotiation stages

b.    Seven Oaks Grammar School Annex which had been deferred awaiting a decision from the Secretary of State on the legality of the proposals

c.    The single system for Early Help

d.    Various SELEP projects and integrated transport schemes.

In conclusion, Ms Carey reminded members that the forecast was concerning and that it was imperative that action were taken to regain control of spending and deliver a balanced budget.

The Leader thanked Ms Carey for her comprehensive overview and referred to the pressures on the asylum budget.  He stressed the importance of securing a refund from the government of the reasonable additional costs incurred by the council in supporting the increasing number of unaccompanied young people seeking asylum.  These costs were currently approaching £7million and must be set out in a comprehensive manner in order to ensure that Government could see that these costs were reasonable.

Andy Wood, Corporate Director of Finance and Procurement responded at the request of the Leader; he explained that some of the difficulties and perceived inconsistencies identified by the home office related to changes in unit costs that occurred over time, when services reached saturation point, for example when in-house foster placement capacity was exhausted and alternative placements must be arranged or the number of staff supporting those placements increased.  This had been set out in a clear and exhaustive manner but had not yet been sufficient to overcome all obstacles to securing a refund from Government. A further discussion with the Home Office was scheduled for later in the week.

The other matter to which Mr Wood referred as a considerable pressure was Home Care costs within Adult Services, an area in which local government and the NHS were both experiencing pressures owing to a significant increase in demand despite good work being undertaken in the area of reablement, in addition to atypical inflation compared to CPI / RPI.  Home care hours were included within the report and had increased by 10% in the last 6 months against a predicted reduction of 40% by March 2016.  It was important that work was undertaken to understand why this was the case in order to control and reduce any overspend.

The Cabinet Member for Specialist Children’s Services, Mr Oakwood spoke on the matter of unaccompanied asylum seeking children.  He reported that despite entering a time of year when arrivals would traditionally be expected to decline the number continued to increase. At the time of the meeting, there were 872 unaccompanied asylum seekers under the age of 18 in Kent of whom 60% - 70% were 16 & 17 years old which meant that the 18+ care leavers budget would soon come under considerable pressure.

The Leader agreed and reiterated the importance of seeking a solution from government, in particular he regarded projections on the 18+ care leavers budget as critical to negotiations for a sensible solution with government, which was needed urgently.

Andrew Ireland, Corporate Director of Social Care, Health and Wellbeing spoke on the matter of unaccompanied asylum seeking children, he referred to the fact that 77 new arrivals had presented in the last weekend and that this was equal to the caseloads of 5 social workers, almost a full team.

He also referred to the issue of home care; he reported that a significant portion of the demand increase could be attributed to patients discharged from hospital following admission last winter who needed double and sometimes triple handed care packages.  This had also placed a significant pressure on domicillary care agencies and so some out of contract arrangements had been undertaken in some areas of the County which inevitably put the unit costs up.  The Leader remarked that the pressures in this area, on Kent and other counties with larger elderly populations were greater than in some other areas of the country and that he hoped that this would be reflected in the Government’s spending review due on November 25^th.

It was resolved that: