Agenda item

RESOLVED: 

1.         That the forecast revenue budget outturn for 2016/17 is a +£22.4m overspend (Annex, paragraph 1 of the submitted report) be noted.

2.         That the forecast efficiencies and service reductions for 2016/17 is £60.3m (Annex, paragraph 32 of the submitted report) be noted.

3.         That the quarter end positions for: balance sheet, earmarked reserves, debt and treasury management (Appendix, paragraphs App 8 to App 32 of the submitted report) be noted.

4.         That the Section 151 Officer’s commentary, Financial and Value for Money Implications and the Monitoring Officer’s Legal Implications commentary (main report, paragraphs14 to 18 of the submitted report) be noted.

5.         That Members and officers should act urgently to identify, agree and implement actions to reduce the 2016/17 overspend (Annex, paragraph 4 of the submitted report)

6.         That the Cabinet and other leading members to bring the council’s budget issues to the attention of Surrey’s MPs (Annex, paragraph 5 of the submitted report)

7.         That a request to reprofile Surrey Fire & Rescue Service’s capital budget (Annex, paragraph 42 of the submitted report) be approved.

Reasons for Decisions

This report is presented to comply with the agreed policy of providing a monthly budget monitoring report to Cabinet for approval and action as necessary.

The Budget Monitoring report was introduced by the Leader of the Council who reiterated the significant challenges which existed to SCC’s long term financial sustainability which included a forecast overspend of £22.4 million for 2016/17. He highlighted that urgent action would be required to tackle this overspend and to present a balanced budget to Full Council at its meeting in February 2017.

The Cabinet Member for Adult Social Care, Wellbeing and Independence indicated that increased demand for services presented significant budget challenges for the Adult Social Care Directorate. ASC had successfully reduced the average cost of social care packages which had achieved savings for the Directorate but advised that these had been offset by the increase in volume of those requiring social care packages from the Council. The Cabinet Member stated that forecast spend for ASC in the financial year would be around £389 million but this would be contingent on winter demand as well as the financial resilience of residential and home-based care providers.

The Cabinet Member for Children and Families Wellbeing advised that the Children’s Services had a projected overspend of £4.3 million for the 2016/17 financial year. She highlighted that it was vital to maintain strong child protection and social work services despite demand for these service growing faster than anticipated. This was compounded by the fact that Children’s Services was also providing for young people with increasingly complex needs some of whom required care packages that could cost the Council up to £300,000 annually. Child asylum seekers also represented an additional financial burden on SCC as the funding that the Government provided for asylum seeking children placed in Surrey did not fully cover the costs that the Council incurred by looking after them.

The Cabinet Member for Schools, Skills and Educational Achievement detailed the financial challenges that were being faced by schools in the County. Surrey receives the lowest funding per pupil of any local authority in England which meant that many schools were struggling to present balanced budgets. The Cabinet was informed that Schools were also finding it challenging to recruit and retain teaching staff  as a result of the high cost of living in Surrey and the fact that schools in London could afford to pay teachers much more competitive salaries. The Cabinet Member did, however, advise that savings were being made through the implementation of the SEND 2020 strategy which would create an improved and more cost-effective service.

The Cabinet Member for Business Services and Resident Experience drew attention to significant underspends in a number of service areas that had been delivered by the Council and which demonstrated the extent of the action that would be required in order for SCC to achieve a balanced budget. This could include considering the possibility of SCC only delivering on its basic statutory duties. The Cabinet Member further highlighted the impact of quantitative easing which was having an adverse impact on the Council’s ability to accrue savings.

Other members of the Cabinet made the following comments:

·         Surrey Fire and Rescue Service (SFRS) was in the process of re-profiling a capital funding grant which it had received from Central Government to facilitate widespread service transformation. Utilising this grant effectively would enable SFRS to deliver significant savings.

·         The Environment and Infrastructure Directorate was also facing significant cost pressures and was projected to have a very small budget overspend for 2016/17. Services provided were  being looked at to consider how the Directorate could achieve further savings in the future.

·         The Highways and Transport Service was on target to meet its budget for 2016/17 although there was a risk of overspending as a result of adverse weather conditions.

RESOLVED: 

1.         That the forecast revenue budget outturn for 2016/17 is a +£22.4m overspend (Annex, paragraph 1 of the submitted report) be noted.

2.         That the forecast efficiencies and service reductions for 2016/17 is £60.3m (Annex, paragraph 32 of the submitted report) be noted.

3.         That the quarter end positions for: balance sheet, earmarked reserves, debt and treasury management (Appendix, paragraphs App 8 to App 32 of the submitted report) be noted.

4.         That the Section 151 Officer’s commentary, Financial and Value for Money Implications and the Monitoring Officer’s Legal Implications commentary (main report, paragraphs14 to 18 of the submitted report) be noted.

5.         That Members and officers should act urgently to identify, agree and implement actions to reduce the 2016/17 overspend (Annex, paragraph 4 of the submitted report)

6.         That the Cabinet and other leading members to bring the council’s budget issues to the attention of Surrey’s MPs (Annex, paragraph 5 of the submitted report)

7.         That a request to reprofile Surrey Fire & Rescue Service’s capital budget (Annex, paragraph 42 of the submitted report) be approved.

Reasons for Decisions

This report is presented to comply with the agreed policy of providing a monthly budget monitoring report to Cabinet for approval and action as necessary.