Agenda item

To note the latest budget monitoring information and approve any necessary changes to the budget.

Cabinet received a report providing the budget monitoring position up to 31 July 2016-17 for both revenue and capital budgets and including an update on key activity data for the Council’s highest risk budgets. The budget monitoring report was the first to be received in the new format.

The Deputy Leader and Cabinet Member for Finance and Procurement introduced the item for members, in particular he referred to the following in relation to the revenue budget:

1. That the current predicted overspend was £9.67million rising to approximately £10.5million once expected roll-forwards and other factors were accounted for.  This was approximately £2.5million higher than at the last report. 
2. That this variation was partly attributed to the following factors:

o   Social Care, Health & Wellbeing

o   Specialist Children’s Services: increased activity in Children in Care (Looked After) Services including secure accommodation, residential care, fostering and SGO’s.

o   Asylum: continued to create a considerable pressure and was considered in more detail later in the report.

o   Adult Social Care: increased pressure on Learning Disability and Mental Health Services; increased demand for equipment services.

o   Growth, Environment and Transport: increased journeys on the Young Persons Travel pass and costs associated with the dry recyclate contract and the costs of waste disposal.

3. The Schools delegated budget had also reported a predicted overspend of £6.7million, partly attributable to the costs associated with converting to academy status.

And the following on the Capital Programme:

1. That there was a reported variance of £10.6million on a total budget of £306million of which £4million were ‘real’ variances and £6million rephrasing.

He concluded that he was concerned by the difficult position reported and emphasised the importance of delivering a balanced budget to members and officers present.

The Corporate Director for Finance and Procurement, Andy Wood spoke to the item, he reported that a moratorium had been considered but owing to the fact that he had been assured by the Corporate Directors responsible for GET, E&YPS and Adult Social Care that the overspends in these areas could be managed back to a balanced position without such intervention it had not been considered necessary at this time.

That would leave overspends to be addressed in Children’s Services and Asylum budgets and discussions were due to take place the next day on how these positions might be improved.  It was, Mr Wood continued, unlikely that a balanced position could be reported in these areas but with a 50% reduction bolstered by underspends elsewhere and with good management action an overall balanced budget was still possible.

The Leader commented on the pressures of the asylum budget and identified the importance of obtaining a better settlement for the 18+ young people in the asylum category and an effective dispersal scheme nationally.  He reported that a letter was being sent to the new Home Secretary to this end.

The Cabinet Member for Specialist Children’s Services, Mr Peter Oakford spoke to the item, he reported that although the dispersal programme had not worked as well as hoped to date, 60 young people had been moved out of Kent and that necessitated a discussion as to whether any fixed costs could now be reduced. He also highlighted the other particular issues impacting on the Directorates ability to reduce overspends such as the higher than anticipated number of children in residential care, a reliance on IFA’s owing to a lack of in-house foster carers and long-running difficulties with the recruitment and retention of Social Workers that had led to a costly reliance on agencies.

Andrew Ireland, Corporate Director for Social Care, Health and Wellbeing also commented on the matter of unaccompanied asylum seeking children.  He said that although the dispersal scheme was almost keeping pace with new arrivals it was not making an impact on the number of children already in the care of KCC.  That, as the Leader had highlighted, left the authority open to tremendous risk as hen these children turned 18 the budget pressures would increase significantly and the current funding regime would not be able to adequately cover those costs.  It was crucial that this risk was mitigated as soon as possible,

It was RESOLVED that: