Contact: Sheila Little, (01962) 847545; [email protected]

1 Summary

1.1 This regular revenue budget monitoring report for the financial year 2006/07 shows there has been a reduction of -£651,000 in the projected overspend for Children's Services at period 10 (end of January 2007) compared with the last report to the Executive Lead Member on 18 January 2007 on period 8, largely reflecting a net reduction in IFA numbers from 133 to 129. However, the impact on the overall projected overspend figure is only a reduction of -£251,000. The difference between the reduction and the impact reflects the latest estimate that there is £400,000 less eligible expenditure to off-set against GSSG than was predicted in the period 8 figures.

1.2 At its meeting on 1 March 2007, the Schools Forum confirmed the budget distribution for use of Headroom in 2007/08 and this included funding the Schools Budget carry forward overspend from 2006/07 based on the period 10 figures of £214,000 and the under spend on Basingstoke School Plus (up to £320,000) and the Locality Teams (£100,000).

1.3 The reduction in the overspend of -£251,000, gives a forecast outturn overspend of £310,000 for period 10, compared with a forecast outturn overspend of £561,000 reported for period 8. It is important to remember that this most recent projected overspend is after applying the following resources to what would otherwise have been a greater overspend:

· Recovery Plan (achieved) £1,183,000

· Business Units Contribution £ 300,000

· Agreed use of General Sure Start Grant (GSSG) £ 500,000

· Provisional agreed use of GSSG £ 100,000.

1.4 Although the scope for identifying eligible expenditure to use against the GSSG which reduces the `bottom line' overspend is more limited than originally hoped, other proposals will help to reduce any potential grant repayment. Nonetheless, the DfES are also being contacted again to seek to carry forward the remaining grant into 2007/08 to meet the known pressures for early years and children's centres.

1.5 This overspend has been incorporated into the revised budget approved by Cabinet on 9 February. This means that the 2006/07 budget has been increased on the basis that the £561,000 will be repaid from the 2007/08 budget. The revised budget has also been increased to bring into account the LPSA 1 Reward grant of £224,000.

1.6 The forecast variations (comparing against adjusted original cash limits, rather than revised budgets) can be summarised as follows:

	Period 8	Period 10	Change
	£'000	£'000	£'000
Schools	+328	+214	-114
LEA	-813	-915	-102
Social Care	+1,846	+1,411	-435
	+1,361	+710	-651
Less Business Units	-300	-300	0
Sub Total	+1,061	+410	-651
Less GSSG	-500	-100	+400
Total	+561	+310	-251

1.7 Details of the projected outturns compared with both original adjusted cash limit and the approved revised budget are shown in Appendix 1. Appendix 2 shows the latest activity data. Variations discussed in this report relate to forecast outturns against original adjusted cash limit in order to provide meaningful comparisons with previously reported variations.

1.8 As part of the revised budget work, management and support budgets and expenditure have been re-classified against the appropriate service headings. This means that the figures reported for each service will be affected by any variances on these budgets. However, for the purposes of this report, variances are reported against original adjusted budgets and exclude these allocations and apportionments of management and support costs.

2 Recommendations

The Executive Lead Member for Children's Services is recommended to:

1 Note the projected outturn position for 2006/07 for the department

3 Revenue Budget Monitoring 2006/07 as at 31 January 2007 (Period 10)

3.1 Details of the main variances and changes since period 8 are shown in the table below and summarised in the following paragraphs:

	Adjusted Original	November 2006	January 2007	Movement
	Budget	Variation	Variation	Nov - Jan
Cash limited expenditure	2006/07
	£'000	£'000	£'000	£'000
Schools Budget
LMS contingency	3,349	+64	+275	+211
EOTAS	7,121	+150	-100	-250
Statemented Pupils	7,454	-400	-400	0
Out-County	7,461	+480	+480	0
Inter LEA Recoupment net	634	+225	+225	0
SEN Support Services	1,895	0	-100	-100
Assistance to voluntary & private providers	2,023	-160	-160	0
School Catering	133	-6	-6	0
Recovery Plan		-25	0	+25
Total Schools Budget		+328	+214	-114
LEA Budget
SEN Audit moderation	54	-24	-24	0
Interest on balances and other misc	-671	-127	-140	-13
Home to School/ College Transport	21,440	+417	+392	-25
Pupil Support	400	0	-33	-33
Access Support	5,321	0	-115	-115
Standards Fund non-devolved	6,934	-9	-9	0
Other continuing education	561	-8	-8	0
Youth Service	6,648	+23	+150	+127
Strategic & Support Services	1,915	-186	-212	-26
Unallocated budget adjustment	116	-115	-116	-1
Recovery Plan	800	-784	-800	-16
Total LEA Budget		-813	-915	-102
	Adjusted Original	November 2006	January 2007	Movement
	Budget	Variation	Variation	Nov - Jan
Cash limited expenditure	2006/07
	£'000	£'000	£'000	£'000
Children's Social Care Budget
Commissioning and social work	18,246	+335	+284	-51
Children Looked After	31,700	+2,165	+1,662	-503
Family support services	6,592	+480	+570	+90
Youth Justice	2,388	-111	-124	-13
Other children and families services	5,979	-568	-405	+163
Management and support	0	-81	-202	-121
Recovery Plan	374	-374	-374	0
Total Children's Social Care		+1,846	+1,411	-435
Other Sources
Unconfirmed use of GSSG	0	-500	-100	+400
Contribution from Business Unit reserves	0	-300	-300	0
Total Other Sources		-800	-400	+400
Total Children's Services		+561	+310	-251

Schools Budget +£214,000

As compared with the cash limit, the following variations are forecast:

Local Management of Schools (LMS) Contingency +£275,000

3.2 An overspend of £64,000 had previously been reported (period 8) in respect of £20,000 adjustments for temporary classroom rentals relating to 2005/06, £41,000 for extra 2006/07 costs associated with extra pupils admitted to Elvetham Heath Primary School, and£3,000 in respect of retrospective pupil number claims for special schools. The revised budget was adjusted as a result of this. However, a balanced budget was reported in period 9 as a result of funds which had been set aside for the proposed new Whiteley Primary School not being needed in 2006/07.

3.3 There are four elements making up the projected overspend of £275,000:

· +£375,000 - additional allocations to be made to schools to match actual business rates costs incurred. The latest information shows that the actual level of costs is above the amounts allocated in budget shares, as a result of the effects of revaluations that have only recently been carried out by the rating authorities

· -£57,000 - additional income from funds relating to excluded pupils i.e. clawback from schools for having fewer pupils. In the first two terms of 2006/07 there have been 18 more exclusions than the corresponding period in 2005/06.

· -£30,000 - funding set aside for infant class sizes not required

· -£13,000 - funds set aside for schools growth not required.


Education Otherwise Than At School (EOTAS) -£100,000

3.4 This represents 1.4% of the cash limit of £7,121,000 and is a reduction of £250,000 compared with period 8.

3.5 There is a pressure of £150,000 relating to additional supply cover, required as a result of long-term sicknesses and to meet the requirements of individualised packages. £140,000 of the pressure is from the Havant area, and £10,000 from Winchester. .

3.6 Against this pressure there is a projected underspend of £250,000 at Basingstoke School Plus. A number of developments planned for 2006/07 have not materialised. Schools Forum have agreed to carry forward this underspending and meet it from 2007/08 DSG.

Statemented Pupils -£400,000

3.7 No change from period 8.

3.8 Based on updated pupil numbers at the beginning of the Autumn Term, a £400,000 saving (5.4% of the cash limit of £7.454m) is forecast. This is in line with the outcome for the 2005/06 low incidence statement budget, which was not identified until after the budget for 2006/07 was set. This saving is proposed to be used to off-set the pressures on the Out County Special Schools budget.

Out County Special Schools +£480,000

3.9 No change from period 8.

3.10 This represents 6.4% of the cash limit of £7.461m. The main pressure is fee increases in 2006/07 which have ranged from 5% to 17%. Placements and expenditure are closely scrutinised by the County Placement Group.

Inter Local Authority Recoupment +£225,000

3.11 No change from period 8.

3.12 The budget of £634,000 reflects the net cost of the movement between Hampshire and other local authorities for special school and special unit places. The variation represents 35% of the net budget or 8% of gross payments (approximately £2.8m).

3.13 The pressure has arisen due to a combination of reasons, but is primarily as a result of late notification of pupil movements in 2005/06 (+£100,000) and above inflation charge increases for 2005/06 by other local authorities, (+£110,000).

SEN Support Services Recharge -£100,000

3.14 This underspend is 5.3% of the budget of £1,895,000 and relates to delayed appointments within the newly-established locality teams.

Early Years and Childcare -£160,000

3.15 No change from period 8.

3.16 This saving has arisen as a result of expenditure from the Grants to Voluntary Organisations budget being charged to the Sure start budget (which is GSSG grant funded).

Catering -£6,000

3.17 No change from period 8.

3.18 This reflects an adjustment to the expected saving and is the result of an anticipated increase in income from milk sales.

LEA Budget -£915,000

3.19 There is a reduction in the underspend of £51,000 (from £966,000 to £915,000) since the end of December, as detailed in the paragraphs below:

SEN Audit Moderation -£24,000

3.20 No change since period 8.

3.21 The projected underspend is 44.4 % of the cash limit of £54,000. The SEN Audit for which this budget is intended has stopped, hence this estimated saving.

Interest on Schools' Balances and other misc. -£140,000

3.22 No change since period 8.

3.23 The extra income is a result of increases in balances and interest rates.

Home to School/College Transport +£392,000

3.24 There is a reduction of £25,000 compared with period 8, mainly as a result of lower than anticipated costs on escorts.

3.25 This forecast represents 1.8% of the cash limit of £21.440m. The significant elements are:

· increased contracted hours for escorts +£60,000 (changes to routes, and an increase in the number of escorts for set routes)

· Increased contract costs +£841,000 (inflation, catchment schools being full, net effect of pupil movements, and complex needs, offset by spend to save savings)

· Season tickets and income +£33,000. A £7,000 pressure on season tickets, and £26,000 less income from other local authorities.

· Applying the Home To School Transport contingency -£517,000.

Pupil Support -£33,000

3.26 The underspend is 8.3% of the cash limit of £400,000.

3.27 This is a newly reported underspend, which arises from there being fewer claims for uniform allowances for secondary school pupils, £314,000 of the £400,000 budget relates to this.

Access Support Services -£115,000

3.28 This is 2.2% of the cash limit of £5,321,000.

3.29 This saving is on staff costs and additional income on the Education Welfare Service

Training & Curriculum Development (Standards Fund) -£9,000

3.30 No change since period 8.

3.31 The saving reflects a number of minor adjustments.

Other Continuing Education -£8,000

3.32 No change from period 8.

3.33 A saving of £8,000 is in respect of costs related to enhanced pensions for Further Education and Higher Education staff for early retirements when they were part of the County Council (prior to the changes in 1989 and 1993).

Youth Service +£150,000

3.34 This variation has increased by £127,000 since period 8. The Youth Service is responsible for the ongoing costs of £79,000 relating to its former accommodation in Wessex Way. This was not included in previous forecast. £48,000 relates to a contribution to Wessex Youth Offending Team that had not been accounted for in the original budget.

Departmental strategic and support services -£212,000

3.35 This represents 11.1% of the cash limit of £1.915m and is an increased underspend of £26,000 since period 8.

Unallocated Budget Adjustment -£116,000

3.36 No change since period 8.

3.37 This represents the full balance of the budget and will be used to offset overspends elsewhere within the Children's Services Department.

Children's Social Care +£1,411,000

3.38 There is a decrease of £435,000 since period 8 as detailed in the paragraphs below. As part of the revised budget work, management and support budgets and expenditure have been re-classified against the appropriate service headings. However, variances are reported against the cash limit in order to facilitate comparison with previous periods..

Commissioning and Social Work +£284,000

3.39 The projected overspend is 1.6% on a cash limit of £18,246,000. This has reduced by £51,000 since period 8.

3.40 Pressures previously reported had arisen due to a number of factors, including the on-going cost of the seconded Data Quality Project Officers until March 2007, the net effect of pressures from staff being appointed above the budgeted midpoint on the pay scales, recruitment bonuses and market supplements.

Children Looked After (CLA) +£1,662,000

3.41 This represents a pressure of 5.2% on a budget of £31.7m and is reduction of £503,000 compared with period 8.

3.42 A paper presented to the Children and Young People Policy Review Committee on 12 December 2006 (Non County Placements & Independent Fostering Provider Placements) presents an up-to-date summary of trends in CLA in detail, while the graph below shows the recent trends:

3.43 This graph demonstrates that the number of CLA have reduced from 1,091 in August 2006 to 1,030 in January 2007.

3.44 The overspend has decreased by £503,000 since period 8, and is made up of the following:

Non-County Placements (NCPs) +£754,000

3.45 This pressure represents 8.6% of the cash limit of £8,754,000 and reflects the growing complexity, and consequently costs, of children's needs.

3.46 There has been a reduction of one NCP placement since period 8 from 59 to 58. There is also a further agreed contribution to children's social care from SEN in respect of one particularly high-cost placement. In addition a reduction in the estimated costs of one other high-cost placement, together with some small variations to other packages, has resulted in the overall decrease of £83,000 since period 8.

Independent Fostering Agencies (IFAs) +£430,000

3.47 This represents a pressure of 7.8% on a cash limit of £5,503,000. This is a reduction of £355,000 since period 8.

3.48 The number of IFA placements has reduced by four overall since period 8 from 133 to 129. Within this net reduction, four new placements have been made, and eight have ended.

3.49 The reduction in forecast is partly as a result of the net reduction in placements and partly as a result of reviewing commitments.

3.50 There has been a net reduction of eleven NCPs, and a net increase of eighteen IFA placements since the start of the financial year. This is illustrated within the following table, while the average number of NCPs and IFAs has been 64 and 132 respectively:

Residential Children's Homes +£95,000

3.51 This represents a pressure of 1.2% on a cash limit of £7,951,000 and is a decrease of £16,000 compared with period 8. A significant amount is due to increased operational costs in 2006/07 following reduced occupancy levels during 2005/06, as a result of some homes operating with a reduced number of beds, partly due to staff vacancies and sickness during the year. An increase in pay costs has occurred as a result of many staff vacancies now being recruited to, with homes now operating to their full bed capacity.

3.52 Work is being undertaken to explore the extent of the use of agency, casual and overtime payments, to cover vacancies and sickness levels within the units.

Fostering Service +£440,000

3.53 This is a pressure of 5.0% on the cash limit of £8,828,000 and is a decrease of £55,000 compared with period 8. The majority of this pressure relates to a review of the estimates of allowances paid to foster carers

3.54 The number of children placed within in-house foster placements remained relatively stable at the start of the financial year at approximately 590 placements, but has since reduced from 588 in October to 541 in January.

3.55 The authority's desire to increase in-house foster care capacity has also led to further pressure within the family placement teams as they try to recruit to all vacancies in order to maximise support and capacity for the in-house carers, therefore reducing dependency on external providers.

Other Residential -£57,000

3.56 This represents a projected underspend of 15.0% on a cash limit of £380,000 and is a decrease in the forecasted underspend of £6,000 compared with period 8.

3.57 The majority of this expenditure relates to care leavers who are placed in supported lodgings and other accommodation. Where these are asylum seekers a significant proportion of the spend is reclaimable from the Home Office.

Family Support Services (Direct Payments, Day Care, Under 8s, Home Care, equipment and adaptations) +£570,000

3.58 This represents a pressure of 8.6% on a cash limit of £6,592,000, a net increase in pressure of £90,000 since period 8.

3.59 Most of these budgets are used to support children with disabilities. The main variations relate to an increase in projected expenditure through Direct Payments (£178,000), home care services (£207,000), and other preventative family support services (£296,000). There are savings on management and support, day care, services for under eights and equipment and adaptations, as summarised below:

Service	November 2006 variation	January 2007 variation	Movement in variation
	£'000	£'000	£'000
Direct payments	+175	+178	+3
Day Care	-2	-23	-21
Under 8s	-23	-20	+3
Home Care	+178	+207	+29
Equipment & Adaptations	-69	-62	+7
Other Family Support	+221	+290	+69
Total	+480	+570	+90

3.60 Within the `other preventative family support services' there has been an increase in pressure of £75,000 since period 8. This relates primarily to the following:

· Increase in residence order and special guardianship order allowances (£30,000), partly offset by decreases in fostering allowances. Since the start of the financial year there has been an increase of 23 (from 353 to 376) in the numbers being paid either through kinship care, adoption, residence order or special guardianship order.

· Increase in preventative and support services of £60,000 across the three areas - £27,000 Winchester FSS team, £10,000 Eastleigh/ Romsey and New Forest, £24,000 North.

Youth Justice -£124,000

3.61 This represents 5.2% on the cash limit of £2,388,000 and is an increase in underspend since period 8 of £13,000.

3.62 The overall underspend reflects a reduction in agency staff at Swanwick Lodge Secure Unit, the use of more casual staff and the continued reduction in long-term sickness.

Other Children's Services -£405,000

3.63 The under spend is 6.8% of the cash limit of £5,979,000 and is a reduction in underspend of £163,000 since period 8. This underspend largely reflects three areas where budgets were set up at the start of the year that have been be re-allocated within the revised budget process (Youth Justice, Quality Protects and Asylum Seekers).

3.64 The reduction since period 8 mainly relates to an increase in expenditure within the Leaving Care Service (£123,000) as a result of additional supported lodgings placements being made, and increases to the original estimated cost of some support packages.

Management and support -£202,000

3.65 This is an increase in underspend of £121,000 since period 8.

3.66 The underspend has arisen mainly from holding vacant some senior manager posts, additional income, unclaimed backfill and by reduced training provision as a result of operational reasons.

4 Consultation

4.1 The forecast outturns are based on ongoing financial monitoring in consultation with partner organisations where appropriate e.g. Youth Offending Team.

5 Legal implications

5.1 None.

6 Financial implications

6.1 The financial implications are summarised at paragraph 1.

7 Personnel implications

7.1 None.

8 Impact assessment

8.1 The proposals contained in this report are not considered to be discriminatory although work will be developed to ensure that the implementation of the recovery plan does not have an adverse impact.

9 Crime prevention issues

9.1 None.

10 Views of the Local County Councillor

10.1 No specific consultations or views sought.

11 Conclusion

11.1 The latest revenue monitoring position shows an improvement against that previously reported

Section 100 D - Local Government Act 1972 - background documents

The following documents discuss facts or matters on which this report, or an important part of it, is based and have been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works.

2. Documents which disclose exempt or confidential information as defined in the Act. - none