Archived decisions

HAMPSHIRE COUNTY COUNCIL

Decision Report

1. Executive Summary

1.1. The purpose of this paper is to inform the Executive Member for Adult Social Care of the budget forecast outturn position and associated performance improvements as at the end of July 2009.

1.2. This paper seeks to:

· Explain the movement in forecast outturn between the 31 May 2009 (period 2- break-even) and 31 July 2009 (period 4 - +£2.1m) and the reasons for areas of potential pressure and under-spend

· Explain the management actions put in place to ensure that the service continues to provide effective critical and substantial support to our clients within our resources.

· Identify the performance achievements that the budget has supported during this period

· Report the progress in appointing to new posts as identified in the budget report to Executive Member for 2009/10¹

· Identify any financial or performance risks that may impact on Adult Services over the remaining financial year.

2. Introduction

2.1. The Adult Services budget is showing signs of mid year pressure. This report provides an update on the budget position as at the end of July 2009 and sets out the key external and internal pressures and the management action that is being taken to achieve a balanced budget in 2009/10 and to facilitate a sustainable budget position for future years. Further information is set out in Section 3.

2.2. Performance targets have now been revised by the Departmental Management Team for 2009/10 to take into account the performance of comparator councils in 2008/09, whilst ensuring improvement is within budget. Further information is contained in section 16. An area of medium risk is national indicator NI 130 Self Directed Support, which includes Individual Budgets and Direct Payments. Incremental improvement will be achieved in 2009/10, with significant improvement planned as part of the roll out of Self Directed Support in 2010/11.

2.3. The Budget Report agreed by the Council in January set a three year budget strategy for Adult Services. As part of that process key risks as well as demographic pressures were identified and considered. These have been monitored as part of the budget and performance management processes within the department.

2.4. Adult Services produce monthly management budget monitoring information and report regularly to the Executive Member. The first budget monitoring report was presented to the Executive Member on 24 July 2009 and showed a balanced budget position with the proviso that the figures needed to be treated with caution with only two months spending incurred. Potential risks were also identified.

2.5. Between period 2 and period 4 some of the pressures highlighted in previous reports have begun to have an impact on our forecasted outturn which now includes an additional pressure of £2.1m (0.7% of the budget). Although this figure in isolation is manageable the potential trends which some of the pressures could follow would lead to medium and longer term pressures on the budget, particularly in future financial years when the full year effects occur.

2.6. The department is therefore proposing action to manage the budget in line with the cash limit in the current financial year as well as preparing to manage the likely additional pressure in future financial years.

2.7. These pressures are being exerted from both external and internal sources. The external pressures are ones which the service will have less direct control over and are set out below:

3. External pressures

These fall into three main categories:

· Demography and complexity

· Ordinary residence

· Continuing health care

Demography and Complexity

3.1. A net increase of £8.4m was agreed to cover demographic and dependency pressures in the 2009/10 budget, this equated to 17,063 client care packages an increase of 632 on the revised 2008/09 budget, the part year effect of which was absorbed in the 2008/09 outturn. As at the end of July 2009 the number of client care packages is 17,925, a further growth of 862 (5.1%) above the budget. Further detail shown in Appendix 2.

3.2. This is potentially the area of greatest concern because on the basis of numbers of clients we are supporting to date we are already close to using up the additional monies provided for in the budget.

3.3. The demographic increases are particularly impacting on Domiciliary care budgets, where the growth has been 636 service users over and above the 2009/10 budget. This supports the policy to keep people at home for longer, but the increasing needs of individual service users is impacting on average cost per client which is for example showing an increase of £35 (27.5%) per week over budget for older persons.

3.4. Complexity is continuing to increase across all care types. Evidence is showing that people are living longer with more complex needs putting pressure on operational budgets for our current service users across all client groups. This can be evidenced in the increasing average cost per client and reduced attrition rates. The rate of attrition for clients since March 2009 has been lower than previously, which compounds the increase in number of clients joining the service leading to unforeseen demographic growth and pressures on 2009/10 and 2010/11 budget settlement.

3.5. As the demography and complexity increases there is a corresponding increase in the number of reported safeguarding incidents. The number of incidents reported to Adult Services during 2008/09 was 797 a 62% increase on the previous year² .

Ordinary Residence

3.6. Under current rules, the deregistration of homes from residential to non residential changes the place of ordinary residence for the residents from their home county to the county where the home is located.

3.7. Hampshire is pursuing cases where we have placed clients in homes within other authorities' boundaries: this will offset the costs but Hampshire is a net importer of ordinary residence cases. Ongoing commitments are shown below:

· Current net impact on the budget £358,000

· Potential additional future net impact £567,000

· Total impact £925,000

3.8. The potential future impact changes on a regular basis as discussions between authorities progress, Legal Services are actively involved in these discussions.

3.9. A net one off provision of £850,000 has been made to cover the potential costs of ordinary residence, to date £200,000 has been used to cover claims for the previous years.

3.10. The service will continue to monitor and manage this pressure during the financial year with a view to minimising the impact. The Council has also responded to Department of Health consultation on ordinary residence suggesting that the current rules should be re-examined.

Continuing Health Care

3.11. NHS Hampshire currently have a backlog of cases lodged with them awaiting continuing health care assessments or decisions. These total £1.5m, which is potential lost income compared with the assumptions made in the budget. It is anticipated that £1m of this will be achieved and this is included in the forecast outturn. However it is judged that £0.5m is at risk of not being achieved. The longer these cases are delayed the more the financial pressure will increase for the County Council. This is an area that remains under close scrutiny by the Care Quality Commission to ensure people's entitlement to local services is upheld. Discussions have been held with the Chief Executive of NHS Hampshire and action has been agreed for 10 outstanding cases to be resolved in the first instance.

3.12. There is a potential risk that if there are additional pressures on budgets within Health that the process could be further slowed down so that costs remain longer with the County Council so cases will be monitored on a regular basis.

4. Internal pressures

4.1. Internal pressures can be managed directly within the department.

4.2. The focus for internal pressures relates to the Self Directed Support (SDS) pilot in the North of the county which has seen the launch of a Resource Allocation System to identify Personal Budgets. This has led to an increase in spend compared to care management .We need to do further work to refine the weighting of the Resource Allocation System to ensure that we remain within budget.

5. Actions being taken to resolve the position

5.1. To ensure that the service continues to provide effective critical and substantial support to our clients but remains within our resources, the department is proposing to invoke a formal financial focus, similar to our financial recovery process in 2006-08.

5.2. The experience from financial recovery will enable us to continue to manage our core business whilst introducing the Hampshire Model. This will ensure that there is full understanding of the financial impact of the implementation of the transformation projects for example SDS and enable the necessary adjustments to management processes before rolling out county wide.

6. Further actions that are being planned:

Targeted Vacancy Management

6.1. The targeting of the vacancy management would need to take into account the implementation of the Hampshire Model and front line services so there is no impact on service users.

6.2. In the 2009/10 budget report an additional 138.5 full time equivalent (FTE) positions were agreed. An additional 6 FTE positions were agreed in the period 2 budget monitoring report, which along with 10.5 FTE deleted posts gives a revised budgeted figure of 134.0 FTE.

6.3. Of these, 61 FTE have been recruited as at the end of period 4 and 21.3 FTE are already being held as part of management action for in-house residential and nursing. The savings for these posts being held are included in the period 4 outturn.

6.4. 18.5 posts are in the process of being recruited. It is proposed to defer the recruitment of 15 of these posts for three months which will result in a part year saving of £112,000.

6.5. Following the reviews of the service plans incorporated in the original 2009/10 budget plan 10.5 posts have been deleted as these will not be required.

6.6. Following the review of the remaining 33.2 posts that are still vacant it is estimated, a further part year saving of £102,000 could be achieved through planned delay in recruitment.

Use of grants

6.7. The department currently receives £53.7m in grants. The majority of these grants are being forecast to be fully spent, work is on-going to identify what has been committed, the remaining unspent portion of the grant could be held and used to offset the budget pressures. To date £263,000 has been identified as being unspent and available to offset pressures. Work is also underway to review grant conditions to identify rules around flexibilities.

Further use of contingencies

6.8. The department currently has contingencies totalling £7.8m. Of these £3m is either committed or is actual expenditure (of which £750k is committed for winter pressures and £33k for section 117 client). A further £1.9m has been allocated to offset period 4 potential pressures, this includes £1.2m inflation growth and £0.5m previously unallocated demography growth. A strategic approach is being taken to the remaining £2.9m, balancing the risks against the real increases in numbers and complexity. The use of the contingency to offset any further pressures, will be a last resort

7. Future Budget Strategy 2009/10

7.1. The strategy is to take the necessary action in the current year in order to remain within our cash limit by using savings from the action outlined above. In addition if, as a result of the above actions, we under-spend in the current financial year, it would be very helpful to be able to carry forward the under-spend to offset the expected full year effect of those pressures in 2010/11 and help position the department for 2011/12 which is expected to be a particularly challenging year financially.

7.2. This approach to the budget is supported by the performance strategy to plan for and achieve incremental improvements that benefit Hampshire residents. This means the department will continue to perform well in delivering good outcomes compared to its comparators, but does mean it may not feature in the top quartile for all national indicators. The need to balance budget and performance remains a key challenge for the department, whilst meeting the needs of the population of Hampshire.

8. Grants carry forwards

8.1. It is proposed to carry forward £3.1m Supporting People grant to offset pressure in 2010/11 and up to 25% of Learning Disability campus programme grant according to the terms of the grant, see section 13.

9. Movement in cash limit

9.1. Over this period the cash limit has increased to £305.7m, due to the receipt of an HIV/Aids support grant of £103,000.

	£'000
Cash limit as at 30 May 2009	305,596
HIV/AIDS support grant	103
Cash limit as at 31 July 2009	305,699

9.2. The HIV/AIDS support grant will be used to provide grants to third party organisations who will provide specialist services (information, counselling, advocacy and, training) to those infected by HIV countywide.

10. Movement in forecast outturn

10.1. Table 1 below sets out the movement in the forecast outturn between 31 May 2009 and 31 July 2009 for each care group.

10.2. Over this period the forecast outturn has moved from a breakeven position to a potential pressure of £2.1m. The reasons for the movement in each of the care groups are explained in paragraphs below.

Performance and business management

10.3. The pressure of £62,000 relates mainly to increased demand in the equipment requirements for occupational therapy clients of £135,000 offset by saving within Business and Performance Information (£67,000) related to staff turnover.

Older people and physical disability

10.4. Older people and physical disabilities is showing a movement of £1.6m on period two. In period 2 a pressure on in-house services was offset by an underspend on purchased services to produce a breakeven position.

10.5. Table 2 sets out the movement between period 2 and period 4 for each of the care types.

Operations Director residential and nursing

10.6. In-house has, with effective management, improved considerably with activity increasing and new beds opening. Whilst there are still risks associated with the budget (see more details in paragraph 17.5), progress to date has been excellent. This has resulted in the in-house position moving from a pressure of £1.2m in period 2 to a breakeven position in period 4.

Older People and Physical Disabilities

10.7. The impact of increasing demographic pressures, rising complexity and higher average cost per client (especially in the north of the county) are all contributing towards the pressure on purchased services, in particular purchased domiciliary care. This has lead to a £1.6m pressure in period 4.

10.8. Over this period client care packages in older people and physical disabilities are continuing to increase with a growth of 290 across the county, 271 of who receive purchased services. The number of client care packages that relate specifically to purchased domiciliary care are 166, 16% over budget.

10.9. The growth in the numbers of client care packages in purchased domiciliary care when combined with increased complexity is seeing an increase in unit costs over and above the average unit costs used to set the budget. This has caused a £4.4m pressure with the purchased domiciliary care budget. This is being offset by savings with purchased residential care (£2.1m) and nursing care (£1.9m) budgets, supporting the policy for keeping people at home for longer. The 2009/10 performance target for the total number of older people supported to live at home was set at 85.5 per 1,000 population aged 65 years plus. This was planned to maintain performance while keeping pace with population growth. The impact of the additional demand being experienced by the department has seen actual performance increase as at July to 86.59. Whilst the data is not directly comparable to budget, monthly performance monitoring provides additional evidence of the increasing demand for help to live at home from vulnerable residents seeking care and support.

10.10. Direct payments in this care group has continued to grow this period, in line with the need to improve performance, with an additional 39 client care packages, but the impact has been increased pressure on the budget £0.7m.

10.11. Whilst purchased nursing is predicting an under-spend, this has reduced since the last report by £797,000. The increase in costs relates to increasing client care packages (52 since period 2) and rising unit costs. Performance monitoring confirms the number of older people admitted to residential or nursing care homes has increased since April. Should this trend continue the target, to reduce numbers, will not be achieved.

10.12. Action is in place to maximise the use of In-house resources to alleviate the pressure on purchased services.

10.13. A number of virements were agreed in the period 2 report to Executive Member, these will be implemented during period 5.

Learning Disability

10.14. Learning Disabilities has seen an overall movement of £529,000 from a breakeven position in period 2 to a pressure in period 4.

10.15. The movement mainly relates to three key areas, purchased home care (£1.1m) purchased day care (£286,000) and direct payments (£384,000), which is offset by an increase in purchased residential under-spend of £1.3m.

10.16. The movement in purchased home care, is primarily due to increasing complexity of needs which impacts on unit costs and when combined with people living longer is creating budgetary pressure.

10.17. Direct payments has shown an increase of 41 client care packages at an additional cost of £384,000. This is supporting NI 130, Direct Payments, which looks at the number of people receiving direct payments on a rolling year.

10.18. Performance improvement is planned to keep pace with demography and is on target to achieve 2.8 per 10,000 people helped to live at home. Performance currently stands at 2.74.

10.19. Action is being taken to review high cost placements; vigorously pursue outstanding continuing health care cases with Hampshire Primary Care Trust and to ensure that income streams, such as, the Independent Living Fund, are being maximised.

10.20. There are two significant risks, ordinary residence and additional savings from Continuing Health Care. They are covered in more detail in section 17.

Mental Health

10.21. The mental health forecast has moved from a breakeven position at the end of period two to a pressure of £71,000. This mostly relates to purchased domiciliary care pressures where the average cost of packages has increased to 14% more than budgeted. There is also pressure on the residential care budgets in the North East of the county.

10.22. Action is being taken to review high cost placements and there has been a further tightening of the County Panel for Mental Health to the effect that all new residential care packages regardless of value will have to be submitted for scrutiny.

Centrally held budgets

10.23. The centrally held contingency for 2009/10 stands at £1.9m. Of this, £750,000 is being held for winter pressures, £250,000 used to offset some of the pressure with OP/PD purchased services and £33,000 is being used to repay client contributions to a section 117 client (paragraph 6.8).

10.24. Other central contingencies are being released pro rata on a month by month basis, showing an under-spend of £175,000 at the end of period 4.

11. Income monitoring

11.1. Adult services receives income from a number of sources;

· Non residential charges

· Client contributions to residential and nursing care

· Health

· Grants

· Recharges

· Other income

11.2. There is potential for the current economic climate to impact on the ability of service users to contribute towards their care. As the income received from service users offsets the cost of care, any reduction in income will impact on the overall budget position.

11.3. As at the end of July 2009 the department is forecast to exceed the income target by £4.1m, this includes any debts that may be written off via the debt write off process. Virements are planned to be implemented in period 5 to realign income budgets. A further update will be brought to the Executive Member in period 6 report.

11.4. Table 4 provides a high level summary of the overall position, a detailed breakdown of the sources can be found in Table 5.

Table 4 - Summary of budget including income
	Budget	Forecast	Variation
	£,000	£,000	£,000
Gross expenditure	394,597	400,785	6,188
Income	88,898	93,014	4,116
Net position	305,699	307,771	2,072

11.5. The 4.6% forecast variation on the budget is comparable with the increase in overall client care packages compared to budget (5.1%).

11.6. The two sources of income forecast to exceed the budgets are related to service users. The non residential charges that relate to domiciliary care are showing an increase of 5.6% over budget. Further analysis is being undertaken to understand why this is lower than the 8.6% increase in service user activity to budget. There are a number of actions within the report that may impact on the number of service users. Income forecasts relating to client contributions are likely to fluctuate accordingly.

11.7. The increase in client contributions for residential and nursing care of 3.8% reflect the increase in service user activity (4%).

11.8. Action: Work needs to be undertaken to understand the impact of the policy of keeping people in their own home for longer will have on income budgets.

11.9. As the number of service users in Basingstoke who have migrated on to self directed support increase, and the move is towards the provision of either domiciliary care or a support service, analysis is being undertaken to identify any impact that movement has on income.

12. Debt monitoring

12.1. The Write Off Panel is currently managing outstanding debt relating to client contributions to the value of £586,000, of which £157,000 is at high risk of being written off.

12.2. As at the 30 May there were no debts requiring formal write off by the Executive Member, as at the end of July, this has moved to 4 debts over £5,000 totalling £35,582 requiring formal write off.

12.3. So far this year 143 debts with an individual value under £5,000 have been written off, totalling £59,377, an increase of £40,514 on period 2.

12.4. The year to date figure suggests a projected annual total of £273,100 which is showing a decrease on the 2008/09 figure of £340,100. The number of write offs is increasing, but there is no indication that this is due to the economic climate.

12.5. Since the debt write off report to the Executive Member⁴ regular monitoring of the write off targets has been undertaken. The Table 6 below gives an indicative position based on information as at the end of period 4, including any debts that have yet to receive formal write off.

12.6. The final position regarding the percentage of income written off as bad debt in 2008/09 was 0.7%. We are currently predicting that forecast write offs will be 0.6% of the overall income budget, whilst this is a marked increase over and above the target of 0.42%, it is lower than 2008/09. The forecast extrapolates the debts written off to date over a 12 month period, as there isn't a regular pattern to debts write offs, the forecast should be treated with an element of caution at this early stage of the year.

12.7. The debt write off process is being reviewed to identify any potential improvements that will make the collection of outstanding debts more effective and reduce the forecast position. The value and number of the write offs will continue to be monitored and if required a request to increase the targets will be made to the Executive Member.

13. Grants

13.1. The total grants available to Adult Services for 2009/10 total £53.7m, these are summarised below.

13.2. Specific grants have increased by £103,000 since period 2 with the receipt of the HIV/AIDS support grant. This increase was anticipated in the Grants to Voluntary Organisations report to Executive Member on 1 May and a full spending plan is in place.

13.3. Whilst the majority of grants are projecting to be fully utilised, two grants are predicting planned under-spends, and two are predicting an unplanned under-spend, these include;

· Supporting people; £3.1m planned under-spend as part of a strategy agreed by the Supporting People County Core Group in January 2009 to manage the reduction in grant in 2010/11.

· Learning Disabilities Campus Programme grant; planning to carry forward up to 25% of the total grant (£0.7m) The grant allows for 25% to be carried forward for the three years of the grant, which will provide a fourth year of funding. The business case for the LD campus programme sets out the time table over four years.

· Social Care Reform Grant (SCRG); showing an under-spend of £109,000. This is due to staff turnover within the Self Directed Support project.

13.4. Action: In light of the risks identified within this report expenditure on grants is being monitored carefully to identify if there is any potential within the criteria to utilise any under-spend to offset any pressures elsewhere.

14. Drug and Alcohol Action Team

14.1. To mitigate the reduction in funding in 2010/11, the total Treatment Budget managed by DAAT is still forecasting a planned underspend of £592,731 as per the report to Executive Member (26^th June 2009). The carry forward will enable the current treatment system to be maintained whilst new services are re-commissioned.

14.2. DAAT funding does not form part of Adult Services cash limit, but Adult Service does contribute towards the support costs by way of grants.

14.3. DAAT performance results for 2008/09 show the total numbers in effective treatment have over achieved the target of 1655 by 57 (4%). Performance results for 2009/10 will not be available until September 2009, and will be reported in future reports to the Executive Member.

15. Progress on recruitment

15.1. The department continues to monitor the overall headcount, as at the end of July 09 a total of 69.8 fte have been appointed. Of these 61 fte relate to the new posts identified in the 2009/10 budget report, the remaining 5.8 fte relate to staff turnover.

15.2. Staff sickness levels are monitored monthly. The percentage of time lost due to sickness between period 2 and period 4 increased by 0.6% to 5.68%. During this period there were a number of cases of influenza, but these tended to be isolated rather than widespread, in line with the business continuity plan staff sickness continues to be monitored on a weekly basis.

16. Performance⁷

16.1. The new National Indicator Set (NIS) of around 189 indicators seeks to measure a broad range of public sector performance at many levels - county, district and organisational. They also vary from measures of longer term strategic intent, such as reducing health inequalities, to specific measures of business activity such as waiting times for services. Many NIS are not `owned' by the County Council, but by partner organisations; with several NIS results collated and reported by national bodies on behalf of government.

Adult Services Performance Priorities 2009/10

16.2. Priorities for `stretched' improvement are those NIS which are included in the LAA, in particular Theme F (Health and Wellbeing) which Adult Services lead in partnership with NHS Hampshire. The Theme F targets are set out in Appendix 1. The department has also set incremental improvement targets for each of the NIS for which it has a direct delivery responsibility; and NI 131 Delayed Transfers of Care, which is a joint health and social care indicator. These are set out in Appendix 1. The department's Performance Management Steering Group, lead by the Assistant Director, is responsible for monitoring performance, identifying risk and agreeing action.

16.3. An area of medium risk is national indicator NI 130 Self Directed Support, which includes Direct Payments. Current performance in this area is below that of other councils, but additional evidence has enabled the Care Quality Commission to acknowledge the county-wide roll out of SDS in 2010/11. Target setting for 2010/11 is being integrated into the budget planning process.

Targets for 2009/10

16.4. A number of the NIS for adult social care are based on measures of volume which has financial implications for the Council. The performance strategy for the department is to set targets which demonstrate incremental improvement and as a minimum, keep pace with demographic growth planned through the budget setting process.

16.5. Performance targets have been set with partners for the LAA and are included in the table below. Targets for the NIS that are the delivery responsibility of Adult Services have been set by the Departmental Management Team for 2009/10 to take into account the performance of comparator councils in 2008/09, whilst ensuring improvement is within budget. An `internal target' for Delayed Transfers of Care has also been set by the Departmental Management Team pending formal agreement with the PCT.

17. Budget and performance risks

17.1. A number of risks were identified as part of the budget report to Executive Member in January 2009, these are listed below. The some of the risks have been revisited as part of this report.

Economic Climate

· Inflation

· Provider stability

· Fewer employment opportunities for younger adults with disabilities

· Monitoring and improving performance (paragraph 17.17)

· Procurement and market management

· LD pressures from re-tendering Supporting People contracts (paragraph 17.3)

· Capacity to manage unforeseen and/or unquantifiable events through contingencies, e.g. pandemic flu, double running costs (paragraph 15.2)

Structural changes

· Relationship with Health

· Governmental and regulatory changes impact on service plan

· Transformation of services

· LD transfer of responsibilities

· SDS and Charging policies

· Strategic review of substance misuse services.

Other

· Pressures in acute hospitals

· Workforce - increasing costs of independent sector

· Ordinary residence (paragraphs 17.8 to 17.13)

· New immigration tests for foreign making it harder to come to work in Britain under new Government immigration scheme

· Safeguarding clients (paragraph 17.4)

· Delivering saving plans

· Impact on the ability of service users to contribute towards their care.

17.2. Specific risks identified as part of period 4 budget monitoring process are covered below

LD pressures from re-tendering supporting people contracts

17.3. In period 2 a potential risk of £965,000 regarding the savings required from the reinvestment fund set aside by Supporting People for Adult Services as part of the Supporting People strategic review of the learning disability sector. Since this was reported, Adult Services and Supporting People have been working closely together to maximise the effectiveness of the reinvestment fund and the savings required have reduced from £965,000 to £650,000. There is still a risk that these savings won't be achieved, and in acknowledgement of this a pressure of £200,000 has been included in period 4 budget monitoring.

Safeguarding

17.4. Safeguarding pressures especially in external homes where there is the potential to re-house service users are continuing to be a challenge. Performance monitoring is evidencing an increase of 62% on 2007/08 with 797 safeguarding incidents reported in 2008/09.

Older Persons and Physical Disability

17.5. Previously it was reported there was a potential risk of a pressure of £1.2m for OP/PD in-house services, but that Management action had been put in place to manage the risk down. A workshop with In-house Service Managers has resulted in a financial focus plan being developed, this includes an agency reduction strategy. To date the action plan has contributed to reducing this risk to £0.8m a reduction of £0.4m. Due to the progress made to date this risk is not included in the forecast position for period 4 as it is assumed that the budget will be balanced by the end of the year.

17.6. As reported in paragraph 3.1, client care packages numbers are increasing which in part relates to lower than expected client attrition, this could, when combined with higher unit costs lead to further pressures on operational budgets. It is hoped that management action examining high cost placements and understanding the reasons for "hot spots" of high costs around the county will help to manage this risk down.

17.7. The economic position is potentially having an impact on staff turnover savings which would normally occur between a member of staff leaving and being replaced. The annual target is a 5% saving, whilst there is some concern that this isn't going to be met, vacancy management is being implemented across the service, but particularly in the South West where there are specific pressures.

Learning Disability

Ordinary residence

17.8. Activity from other local authorities looking to reclaim ordinary residence costs for clients who have taken out a tenancy in Hampshire, has continued to increase since the beginning of the year.

17.9. A net one-off provision for £850,000 was made at the end of 2008/09 for clients that were potentially going to become an ongoing responsibility of Hampshire County Council or that Adult Services was pursuing with other authorities. There is a risk that this may not cover the full amount, currently approximately £200,000 has been used to cover backed dated claims.

17.10. Action: The Head of the Integrated Learning Disability Service is continuing to work closely with Legal Services to ensure that all cases raised against Hampshire are robustly challenged and that all potential cases that could result in a saving to Hampshire are vigorously followed through. Ongoing cost will be considered in 2010/11 budget preparation.

17.11. Table 8 summarises the current position as at the end of July

Table 8	Ordinary Residence forecast as at the end of July 2009
		Total Actual	2009/10 Commitments	Total Forecast	No. of clients
		£	£	£
Costs of service users now the responsibility of Hampshire		536,692	827,185	1,363,877	27
Successful cases (savings and income)		(179,048)	(259,815)	(438,863)	15
Net pressure/(savings)		357,644	567,370	925,014

17.12. Whilst the actual position has not changed since period 2 the number of potential calls against Hampshire has increased as have the potential savings giving a net growth of £228,083.

17.13. Action: There is no certainty that the department will incur the costs or savings in 2009/10 and they are not included in the forecast outturn. Only those costs that have been agreed (actual column) are included. The risk is monitored on a monthly basis and should there be any change in the risk then the position will be reviewed.

Continuing Health care

17.14. The Learning Disability transition service user budget includes a £1m provision for the gross cost of transition clients. This is largely sourced from achieving Continuing Health Care income from qualifying service users. The current backlog amounts to potential income of £1.5m. Discussions have taken place between the Director of Adult Services and the Hampshire Primary Care Trust's Chief Executive, the PCT has shared their list of cases and agreement has been reached to pursue 10 cases in the first instance, before progressing to further cases.

17.15. The LD budget forecast is assuming that £1m saving will be achieved, and the £0.5m is at risk of not being achieved.

Health

17.16. The PCT is still reporting a pressure and has significant management actions to balance their budget by the year end. This includes a demand management plan of £57.8m. This reflects ongoing overheating in the Hampshire health economies. They are reporting £21m of their cost reduction and demand management actions to be at risk, only part of which can be met from contingencies. This significantly affects the environment for partnership. Many of the demand factors affecting health have a subsequent effect in social care.

Performance risks

17.17. Risks to performance are in those areas where increased volume is regarded as improvement; and competition from Councils with higher levels of deprivation and funding . All performance targets for 2009/10 have been set to be achieved within the current budget. This period has seen a growth in performance especially direct payments and `help to live at home' indicators, but this has corresponded with pressures on these budgets. The impact on future performance will need to be considered when developing action plans to address the pressure.

18. Hampshire model

18.1. Work continues around the implementation plan for the Hampshire Model. There is a risk that the impact of the economic climate on HCC budgets could lead to delays in implementing the Hampshire Model within 3 year time plan.

18.2. Progress is continuing on all work streams; in particular on the Free Crisis Care regarding the time to think beds, where the emphasis has moved from commissioning beds to using in-house beds to maximise the use of internal resources and minimise the impact on purchasing budgets

18.3. Funding of £3.3m has been identified from the Social Care Reform Grant (SCRG) and currently this is supporting the implementation of a number of projects:

· Self Directed Support

· Community innovation teams

· Time to think beds

· Care choice

· Learning disability integration

· Integrated Community Equipment store (ICES) system replacement

· Front line staff development

18.4. Standardised budget monitoring of Hampshire Model projects will begin from period 5, coupled with budget preparation this should give a much clearer understanding and monitoring of costs and budgets. This is not a risk at present because impact is purely on the costs reflected in the project plans rather than the projections in the financial system. Therefore planned costs are expected to fall by Period 6.

19. Update on action plan

19.1. Since period 2 a record of the actions identified as part of the regular monitoring to DMT and the Executive Member have been kept and progress monitored

20. Client Care Packages Analysis

20.1. Activity levels here are presented using the "Average weekly cost" data source from SWIFT. This method counts some clients more than once if the client receives more than one type of care.

20.2. The current client care packages are currently 862 above budgeted level which shows complexity is increasing against all care types. The significant variances are:

· Domiciliary care 636 above budgeted level, reflecting Personalisation and clients choosing to live in their own homes.

· Day Care 178 below budgeted level, primarily OP clients, which is reflected by a small underspend on this care type.

· Direct Payments 147 above budgeted level. The SDS Phase 1 in Basingstoke and County wide management action to increase take up of Direct Payments to promote personalisation and meet performance targets, has resulted in the targeted client activity being exceeded.

20.3 The movement in the individual client groups is summarised below and further detail can be seen in Appendix 2.

21. 2009/10 Capital Programme Position

21.1. The total capital cash limit for 2009/10 is £11.8m. This includes £1.7m transferred from revenue, and £5.8m carried forward from 2008/09, as agreed by Cabinet. An additional grant has been awarded for Common Assessment Framework £1.2m which is included within the £11.8m cash limit.

21.2. The Capital programme position is summarised in Table 9 below. The capital programme is currently planned 59% at the end of period 4. The summary shows a significant commitment for investment in Older Peoples Homes (OPH) Improvements, Extra Care Housing and the Common Assessment Framework.

OPH:

21.3. 2009/10 is the final year of the four year Capital Strategy, approved by Cabinet in July 2006, which has seen investment of over £12m in Adult Social Care facilities. A primary focus of the strategy has been the continued modernisation of the older persons' residential estate. Expenditure on minor improvement works and the upgrading of furniture and equipment across the estate also continues, as does the programme for the establishment of joint learning disability management team bases with the Hampshire (NHS) Partnership Trust..

21.4. Whilst the programme to modernise the County Council's older persons' homes is now well advanced, it is not yet complete and a further investment strategy to achieve that, together with the modernisation of facilities for other service-user groups will be brought forward in as part of the budget setting process..

Extra Care Housing:

21.5. The development at Brighton Hill, Basingstoke is progressing well and progress is also being made on new sites for investment. Details of these proposals will be taken to the Executive Member in the November report.

Common Assessment Framework:

21.6. Work started in April on the DoH grant funded Common Assessment Framework for Adults demonstrator site. Initial phases of this 2 year programme are looking at analysis of the business process with development of the IT solutions planned towards the end of the financial year.

Other:

21.7. Expenditure on minor improvement works and the upgrading of furniture and equipment across the estate also continues, as does the programme for the establishment of joint learning disability management team bases with the Hampshire (NHS) Partnership Trust.

21.8. Investment in IT projects continues to strengthen existing systems. SWIFT is being worked on including the upgrade to the latest version of the application. Tools are being developed to sit alongside SWIFT to support the requirements for the rollout of SDS. Other IT projects include investment to support Hampshire Workstyle through purchasing of mobile solutions and training and support to the Hampshire Model.

* Carried forward from 2008/09 Revenue

22. Recommendation(s)

22.1. It is recommended that

· The forecast position as at the end of July 2009 be noted (paragraph 2.5)

· The actions being planned to further control the forecast position and the proposed financial strategy for carrying forward any under-spend should the actions be successful be agreed (sections 5, 6 and 7)

· The external and internal pressures identified in the report are noted (section 3)

· The £3.1m Supporting People planned under-spend as agreed by the County Core Group in January 2009, is carried forward to meet the reduction in funding in 2010/11 is agreed. (paragraph 13.3)

· It is planned to under-spend by up to 25% of the Learning Disability Campus Programme grant and carry forward as per the conditions of the grant that allows funding to be carried forward over the three years of the grant is agreed. This will provide a fourth year of funding as per the implementation plan is agreed. (paragraph 13.3)

· The Performance and Human Resource results as detailed in the report are noted (sections 15 and 16)

· The Hampshire Model resource plan update be endorsed (section 18)

· The capital programme position as at the end of July 2009 be noted (section 21)

Appendices - Executive Member Decision day

Appendix 1 - Performance

Appendix 2 - Client Care Packages Analysis

CORPORATE OR LEGAL INFORMATION:

Links to the Corporate Strategy

IMPACT ASSESSMENTS:

1. Equalities Impact Assessment:

1.1. The Department's budget and performance strategies are developed in accordance with the Council's Equalities Policy and target the most vulnerable in society.

1.2. How budgets are used have a significant impact on the most excluded. The operational directors have lead responsibility to ensure that impact assessments take account of the needs of these groups. The head of finance is a member of the Departmental management team, and part of her role is contribute to these impact assessments. This budget monitoring report provides information on the progress of spending plans of the Directorate and will contribute to better outcomes for all.

2. Impact on Crime and Disorder:

2.1. The County Council has a legal obligation under Section 17 of the Crime and Disorder Act 1998 to consider the impact of all the decisions it makes on the prevention of crime. The proposals in this report have no proven impact on the prevention of crime.

3. Climate Change:

a) How does what is being proposed impact on our carbon footprint / energy consumption?

All relevant developments within the revenue budget and capital programme are subject to specific, detailed assessments. Energy conservation, and where applicable enhancing biodiversity, are priorities for all major building schemes and the revenue budget includes an allocation to specifically encourage sustainability initiatives.

b) How does what is being proposed consider the need to adapt to climate change, and be resilient to its longer term impacts?

Where appropriate capital schemes are planned with adaptation to climate change in mind, such as the inclusion of passive cooling through building design, rain-water and grey-water harvesting, drought resistant planting etc.

Appendix 1 - Performance

Local Area Agreement Theme F Health and Wellbeing

NIS for which Adult Services has a direct delivery responsibility

Appendix 2

Client Care Packages Analysis by Care Type

Activity levels here are presented using "Average weekly cost" data source. This method counts some clients more than once if the client receives more than one type of care.

Client Care Packages by Care Type and by External & Internal Provider

Activity levels here are presented using "Average weekly cost" data source. This method counts some clients more than once if the client receives more than one type of care.