|
|
|
|
|
|
|
|
|
Children, Culture and Communities Scrutiny Committee |
3 September 2024 |
|
Report of Richard Hartle, Head of Children & Education Finance and Ian Cunningham, Head of Business Intelligence |
|
2023/24 Finance and Performance Outturn
Summary
2. Reports to Executive throughout the year have outlined the Council’s serious financial position as we continue to see significant, recurring pressures across both children’s and adults social care budgets.
3. Whilst there have been some improvements in the outturn, due to the significant work undertaken by officers across the Council to reduce spending and carefully control all costs, the underlying position is still a significant overspend that is of serious concern. It remains the case that the Council cannot afford to keep spending at this level. The general reserve is £6.9m and, whilst we have other earmarked reserves that we could call on if required, continued spending at this level would quickly see the Council exhaust its reserves.
4. The recurring overspends across both adult and children’s social care are significant and, despite investment made in the 2024/25 budget process, we expect to see a continued pressure into the new financial year.
Background
Financial Summary
5. The draft outturn position is an overspend of £3.7m, compared to a forecast at Monitor 3 of £5.6m. This improvement arises from the significant amount of work undertaken by officers across the Council to identify savings and mitigations across all service areas. In Childrens, for example, this has resulted in a recurring improvement of some £2m in the outturn position.
6. Alongside this, the strict cost control measures implemented at the start of the financial year have also had a significant impact in reducing the overspend. Whilst it is positive that the significant amount of work undertaken by staff across all Council services has reduced the overspend position, it is important to note that there remains a significant overspend across social care that will need to again be carefully monitored with in-year savings identified.
7. The underlying position is an overspend of £8.6m, offset by underspends in Corporate and Place. Most of the areas of underspend (parking income and savings due to delaying borrowing) have already been assumed as 2024/25 budget savings, and therefore will not recur at the same levels.
8. Members will be aware that the financial position of local government is a national challenge and that the pressures being seen across both Adult and Children’s Social Care are not something that is unique to York. Many Councils are experiencing significant financial pressures and struggling to balance their budgets now, so it is vital that we continue to take the necessary action to reduce our expenditure down to a sustainable level.
Financial Analysis
9. The Council’s net budget is £141m. Following on from previous years, the challenge of delivering savings continues with c£6m to be achieved to reach a balanced budget. An overview of the latest forecast, on a directorate by directorate basis, is outlined in Table 1 below.
|
Service area |
Net budget |
2023/24 Net Q3 Forecast Variation |
2023/24 Draft Outturn |
|
|
£’000 |
£’000 |
£’000 |
|
Children & Education |
32,701 |
3,690 |
2,609 |
|
Adult Social Care & Integration |
50,093 |
4,712 |
6,051 |
|
Place |
33,206 |
-1,040 |
-2,310 |
|
Customers & Communities, Public Health & Corporate Services |
8,935 |
830 |
-89 |
|
Central budgets |
17,189 |
-2,600 |
-2,600 |
|
Sub Total |
|
5,592 |
3,661 |
|
Contingency |
-500 |
-500 |
-500 |
|
Use of earmarked reserves |
|
-4,250 |
-3,161 |
|
Target for further mitigation |
|
842 |
|
|
Net total including contingency |
141,624 |
nil |
nil |
Table 1: Finance overview
Children, Culture & Communities Analysis
10. The draft outturn position for those areas covered by this committee is an overspend totalling £2,323k and the table below summarises the position by service area.
|
2023/24 Monitor 3 Variation £000 |
|
2023/24 Latest Approved Budget |
2023/24 Actual Outturn Variation |
||||
|
Gross Spend £000 |
Income £000 |
Net Spend £000 |
|||||
|
£000 |
% |
||||||
|
|
Children & Education |
|
|
|
|
|
|
|
+3,113 |
Children’s Safeguarding |
23,826 |
1,149 |
22,676 |
+2,863 |
+12.6% |
|
|
+1,641 |
Education & Skills |
20,135 |
5,039 |
15,097 |
+272 |
+1.8% |
|
|
+119 |
School Funding & Assets |
170,894 |
178,536 |
-7,642 |
-103 |
-1.3% |
|
|
+7 |
Director of C&E & Central Budgets |
8,421 |
5,851 |
2,570 |
-423 |
+16.4% |
|
|
-1,190 |
Mitigations |
|
|
|
|
|
|
|
+3,690 |
C&E Directorate Total |
223,276 |
190,575 |
32,701 |
+2,609 |
+8.0% |
|
|
-30 |
Culture & Communities |
14,867 |
7,097 |
7,770 |
-286 |
-3.7% |
|
|
+3,660 |
CC&C Scrutiny Total |
238,143 |
197,672 |
40,471 |
+2,323 |
+5.7% |
|
11. There has been significant progress made in reviewing and reducing the expenditure across Children & Education, with a substantial reduction in the use of agency staff and the cost of placements. This is extremely positive and is against the national trend of ever increasing overspends in Children’s Services. However, costs are increasing due to inflation, an increase in safeguarding activity reflecting greater complexity of needs and the challenges of a dysfunctional children’s social care market.
12. As previously reported, the number of Children Looked After (CLA) in York has consistently been at a higher level than the budget was built to accommodate. The number at the beginning of the financial year was 267, at the end of March it was 245. Placement budgets overspent by a total of £3,027k, which is a significant improvement from the 2023/23 outturn which was £5,651k overspent. However, the pressure on this budget continues and is partly due to the limited market for children’s placements and the statutory requirements placed on local authorities to meet children’s needs, coupled with inflationary pressures which could worsen the position.
13. The Safeguarding Interventions & Assessment Teams budget has underspent by 246k due to vacancies held by the various teams throughout the year.
14. Staffing & other budgets within Children’s Social Work Services have underspent by £241k. The majority of this underspend is due to additional income. Legal fees have overspent by £163k.
15. There is a underspend of £48k in the MASH & Targeted Intervention teams. The reason for underspend is due to vacancies held by the various teams throughout the year.
16. The Disabled Children’s Services overspent by £746k mainly due to overspends on direct payments £387k, £157k for home support for a specific young person & £70k for Childcare services. A specific project reviewing historic direct payments and the process of future payments is being carried out and this is predicted to clawback some unspent payments and reduce future expenditure. This will affect 24/25.
17. Innovation and Children`s Champion budgets underspent by £137k due to the ability to fund some expenditure from the Family Hubs grant without increasing the establishment.
18. Home to School Transport overspent by £620k. This continuing overspend is due to an increase in numbers for post 16/19 plus the provision of more specialist education provision locally. This is a much more cost-effective alternative to expensive out-of-city provision but has a consequent effect on this budget as we have had to provide more transport to establishments such as York College, Askham Bryan, Choose 2 and Blueberry Academy. The change in legislation to allow EHCPs up to the age of 25, resulting in significantly more students accessing this option, has also significantly increased our transport spend.
19. Staff resourcing issues and turnover in the SEND Statutory Services Team, and the need to resource this work to progress the Safety Valve targets has resulted in a small number of agency staff being appointed into this team over the period under consideration, resulting in an overspend of £191k (a significant improvement on the £405k overspend in 2022/23). The Educational Psychologists Service has underspent by £132k mainly due to vacancies in the team.
20. The Effectiveness and Achievement Service has overspent by £125k mainly due to one-off unexpected expenditure (York MIND), unachieved vacancy factors and also a delay in the implementation of a saving.
21. An overall underspend of £111k was achieved within the Virtual School and Inclusion service, due to a vacancy and one-off savings in non-staffing expenditure.
22. The Dedicated Schools Grant (DSG) is ahead of the target position set out in the Safety Valve recovery plan agreed with the DfE. The local authority is now in the second year of this four year agreement and has exceeded the financial targets for this year.
23. The main pressure continues to be experienced within the High Needs Block and is due to the continuing increase in High Needs numbers, and increasing complexity, requiring expensive provision, especially in Post 16 and Post 19 provision and the education element of Out of Authority placements.
24. The brought forward balance on the DSG at 1 April 2023 was a deficit of £2,723k. The current year end projection is a deficit of approximately £700k, although this is still being finalised.
25. The Safety Valve agreement commits the local authority to bring the DSG into an in-year balanced position by 2025/26. Further payments are conditional on the local authority meeting the targets set out in the Management Plan, and reporting quarterly to the DfE on progress, with the eventual aim of eliminating the in-year deficit by the target date, with additional payments by the DfE eliminating the historic deficit at that point.
26. General Fund budgets within School Funding and Assets have underspent by £108k. This is due to the use of unspent grant funding of £160k and an over-achievement of income on interest charges to schools on early payment of BAFS funding of £71k. These have been offset by the £144k cost of writing off the revenue deficit of Naburn Primary School following conversion to an academy under the sponsored conversion route.
27. Finally, senior officers in the Directorate and Finance reviewed all budgets and identified a number of in-year mitigations to reduce the headline overspend of £4,880k at Monitor 3. An amount of £1,212k has been achieved to assist with the headline overspend, mainly from reserves and grants brought forward that can be allocated to fund expenditure in the year, plus a small amount of unallocated growth and a contingency budget.
28. Within Communities there was a saving from commissioning grants (-£100k) and also from maximising charges to grants and external funding. There was an underspend in relation to Ward Committees of £16k and it was agreed to refocus this funding to YFAS for 2024/25.
Performance – Service Delivery
29. This performance report is based upon the city outcome and council delivery indicators included in the Performance Framework for the Council Plan (2023-2027) which was launched in September 2023. Wider or historic strategic and operational performance information is published quarterly on the Council’s open data platform; www.yorkopendata.org.uk
30. The Executive for the Council Plan (2023-2027) agreed a core set of indicators to help monitor the Council priorities and these provide the structure for performance updates in this report. Some indicators are not measured on a quarterly basis and the DoT (Direction of Travel) is calculated on the latest three results whether they are annual or quarterly.
31. A summary of the city outcome and council delivery indicators by council plan theme are shown in the paragraphs below along with the latest data for all of the core indicator set.
32. Number of children in temporary accommodation – at the end of Q3 2023-24, there were 39 children in temporary accommodation in York which, which is a reduction from 47 children in Q2 and from 63 at the end of 2022-23. The majority of these children are in stable family setups, do not show evidence of achieving worse outcomes, and York continues to report no households with children housed in Bed and Breakfast accommodation.
33. %pt gap between disadvantaged pupils and their peers achieving 9-4 in English and Maths at KS4 – In 2020 and 2021, all GCSE, AS and A Level exams were cancelled and replaced by a combination of teacher assessment, mock exam results, course work and a standardised calculation. Summer 2022 saw a return to the familiar testing methods.
34. The gap at age 16 widened in York and Nationally to 43% in summer 2023. A legacy of Covid-19 is that school attendance of disadvantaged groups has been slower to recover, and has been worse than for the same group nationally. The work currently being undertaken through the Attendance Graduated Response is seeing improvements in attendance.
35. Reducing the attainment gap between disadvantaged pupils and their peers is a key priority in all phases of education across 0-19 years. Our long-term strategy re closing the gap is linked to the early identification of speech, language and communication needs in the early years through Early Talk For York (ETFY). Early communication and language development is particularly important in helping to tackle inequalities between disadvantaged children and their peers. Data shows that the ‘gap’ between non disadvantaged children nationally and disadvantaged children in the ETFY area reduced by 32%, from 34.5% (2018) to 2.5%, during the pilot. The scale up of the programme is designed to reduce the long-standing attainment gap and will focus on supporting the transition of children from the early years in to school.
36. % of reception year children recorded as being overweight (incl. obese) – The participation rates for the National Child Measurement Programmes (NCMP) in York for 2022-23 were 97.2% for reception aged children and 95.1% for Year 6 pupils.
· The 2022-23 NCMP found that 19.9% of reception aged children in York were overweight (including obese), compared with 21.3% in England and 22.5% in the Yorkshire and Humber region. York has the second lowest rate of overweight (including obese) for reception aged children in the Yorkshire and Humber region.
· Of Year 6 children in York, 32.5% were overweight (including obese) in 2022-23 compared with 36.6% in England and 38.1% in the Yorkshire and Humber region. York has the lowest rate of overweight (including obese) for Year 6 children in the Yorkshire and Humber region.
37. % of adults (aged 16+) that are physically active – The latest data from the Adult Active Lives Survey for the period from mid-November 2022 to mid-November 2023 was published in April 2024. In York, 515 people aged 16 and over took part in the survey, and they reported higher levels of physical activity, and lower levels of physical inactivity, compared with the national and regional averages. Positively:
· 69.8% of people in York did more than 150 minutes of physical activity per week compared with 63.4% nationally and 61.7% regionally. There has been no significant change in the York value from that 12 months earlier.
· 18.8% of people in York did fewer than 30 minutes per week compared with 25.7% nationally and 27.7% regionally. There has been no significant change in the York value from that 12 months earlier.
39. Children subject to a Child Protection Plan – 147 children were the subject of a Child Protection Plan at the end of March 2024. The number of children on plan in York was consistently within our expected range (111-141 child protection plans) throughout 2023-24. As a rate per 10k population, York is currently below the most recently released National average.
40. % of working age population qualified to at least L2 and above – In 2023-24, 90% of the working age population in York were qualified to at least L2 and above (GCSE grades 9-4), which is higher than the national and regional figures (86.5% and 85.1% respectively). This result ranks the city of York first regionally. This latest figure is a slight decrease from 2022-23 (94.2%). It should be noted that there has been a slight change in methodology from 2022-23.
41. % of working age population qualified to at least L4 and above – In 2023-24, 53.8% of the working age population in York were qualified to at least L4 and above (certificate of higher education or equivalent), which is higher than the national and regional figures (47.3% and 41.2% respectively). This result ranks the city of York fourth regionally. The 2023-24 figure is a decrease from 2022-23 (60.3%) but higher than in previous years.
42. % of pupils achieving 9-4 or above in English and Maths at KS4 – DfE data shows strong performance for York pupils when compared with National averages. In 2022-23, 70.2% of York’s Year 11s achieved grades 9-4 in English and Maths (considered a standard pass), compared to 65.3% Nationally.
43. % of children who have achieved a Good Level of Development at Foundation Stage – 69.7% of our 5-year-olds achieved a Good Level of Development compared to 67.2% Nationally, and 66.2% in Yorkshire and Humber.
44. Performance in York and nationally has not yet returned to 2019 levels. Studies which are analysing the impact of the pandemic on Early Years Development broadly suggest that we could see similar performance for several cohorts whilst the children “catch up” following the disruption of the pandemic.
45. Number of homeless households with dependent children in temporary accommodation – The overall number of households in temporary accommodation has been reducing during 2023-24, from 73 in Q1 to 64 in Q3. The number of those with dependent children has reduced from 28/30 households in Q1/Q2 to 26 at the end of Q3 and these continue to be less than the 35 households at year end 2022-23.
46. Of the 26 households with children in temporary accommodation at quarter end, most were recorded as accommodated in hostels with one accommodated within Local Authority housing stock. York continues to report no households with children housed in Bed and Breakfast accommodation.
47. During Q1-3 2023-24, an upward trend in overall numbers can be seen both nationally and regionally, however York has been moving in the opposite direction. When looking at the total number of households in temporary accommodation per households in area (000s), York continues to perform positively compared to benchmarks (0.73 in York compared to 4.7 Nationally, 1.3 Regionally and 17.4 in London). It should be noted that these figures are snapshot figures and therefore may fluctuate between the snapshot dates.
48. % of Talkabout panel satisfied with their local area as a place to live - The second biannual resident satisfaction survey taken by the Talkabout panel took place during Q3 2023-24. Results from the Q3 2023-24 Talkabout survey showed that 80% of the panel were satisfied with York as a place to live, and 80% were satisfied with their local area, both consistent with results from Q1 2023-24. A slight decline in satisfaction with the local area can be seen over recent years but York continues to perform well against the latest national figure of 76% (Community Life Survey 2021-22).
49. % of Talkabout panel who give unpaid help to any group, club or organisation - Results from the Q3 2023-24 Talkabout survey found that 60% of panellists had given unpaid help to any group, club or organisation within the last 12 months. This is a slight decrease from Q1 2022-23 (62%), but higher than the latest national figure of 55% taken from the government's Community Life Survey 2021-22.
Consultation
50. Not applicable.
Options
51. Not applicable.
Analysis
52. Not applicable.
Council Plan
53. Not applicable.
Implications
54. The recommendations in the report potentially have implications across several areas. However, at this stage:
· Financial implications are contained throughout the main body of the report.
· Human Resources (HR), there are no direct implications arising from this report.
· Legal the Council is under a statutory obligation to set a balanced budget on an annual basis. Under the Local Government Act 2003 it is required to monitor its budget during the financial year and take remedial action to address overspending and/or shortfalls of income. Further work is required to develop and implement proposals that will allow the Council to bring its net expenditure in line with its income. There may be legal implications arising out of these proposals that will be considered as part of the development and implementation of those proposals. If the Council is unable to set a balanced budget, it is for the Chief Financial Officer to issue a report under s114 of the Local Government Finance Act 1988 (‘a section 114 notice’).
· Procurement, there are no direct implications arising from this report.
· Health and Wellbeing, reductions in spend in some areas could impact on the health and wellbeing of both our staff and residents. The impact of any reductions in spend will continue to be carefully monitored so that implications can be considered and mitigated where possible.
· Environment and Climate action, there are no direct implications related to the recommendations.
· Affordability, are contained throughout the main body of the report. Where decisions impact on residents on a low income these impacts will be recorded in the individual Equalities and Human Rights analysis referred to below.
· Equalities and Human Rights, whilst there are no specific implications within this report, services undertaken by the Council make due consideration of these implications as a matter of course.
· Data Protection and Privacy, there are no implications related to the recommendations.
· Communications, the information set out in this report necessitates both internal and external communications. With ongoing interest in the current state of Local Government funding, we anticipate this report will attract media attention. A comms plan has been prepared to help make the information about the forecast overspend and the controls proposed clear and understandable, with opportunities to facilitate staff discussion arranged.
· Economy, there are no direct implications related to the recommendations.
Risk Management
55. An assessment of risks is completed as part of the annual budget setting exercise. These risks are managed effectively through regular reporting and corrective action being taken where necessary and appropriate.
56. The current financial position represents a significant risk to the Council's financial viability and therefore to ongoing service delivery. It is important to ensure that the mitigations and decisions outlined in this paper are delivered and that the overspend is reduced.
Recommendations
57. The Committee is asked to note the finance and performance information.
Reason: to ensure expenditure is kept within the approved budget.
Contact Details
|
Author: |
Chief Officers Responsible for the report: |
||||||
Richard HartleHead of Children and Education FinanceExt 4225
Ian Cunningham Head of Business Intelligence Ext 5749 |
Martin KellyCorporate Director of Children & Education
|
||||||
|
Report Approved |
ü |
Date |
22 August 2024 |
||||
|
Pauline Stuchfield Director of Housing & Communities |
|||||||
|
Report Approved |
ü |
Date |
22 August 2024 |
||||
|
|
|||||||
|
|
|||||||
|
Wards Affected: List wards or tick box to indicate all |
All |
ü |
|
||||
|
|
|||||||
|
For further information please contact the author of the report |
|||||||
Background Papers:
None.
Annexes:
Annex A: CCC Q4 23-24 Scrutiny Committee Scorecard.