Agenda item

To consider the level of spending against the Council’s Revenue and Capital budgets for the first seven months to 31 October 2016.

The Committee considered the financial performance monitoring report, which set out the summary revenue budget position for the Council and its individual directorates for month 7, the period April 2016 – October 2016, together with an outlook for the remainder of the year. The report was complemented with an assessment of progress to date against the latest capital programme.

The report was presented by Mr Thompson, Director of Resources. He provided an overview of the current situation, which was a month 7 forecast overspend of £2.628k for 2016/17. He explained that the main focus was on Children’s Services, the financial situation for which had become progressively worse over the course of the year. The reason was largely due to the increased number of looked after children, of which there had been a 10% increase in the last year to 509, together with an increase in associated costs. As a result, a £3.988m overspend was forecast within Children’s Services.

Mr Thompson went on to explain that all other directorates were delivering on their financial targets and in some cases, further savings were being made. Income collection was an area of high priority and Mr Thompson explained that by the end of the financial year, he anticipated a positive increase in business rates collection. He added that following the approval to review the Council Tax Reduction Scheme, there would be a new policy to protect the most vulnerable people.

Mr Thompson responded to a number of questions from the Committee. Noting the savings that had been achieved in a number of directorates, the Committee asked about the possibility of achieving a target position at year end. Councillor Blackburn explained that it would be impossible to recover from an almost £4m overspend within Children’s Services and that any deficit would be built into the budget model for coming years.

The Committee pointed out that compared with the current figure of over 500, that in March 2010, there had been approximately 370 looked after children from Blackpool. In view of that increase, it was asked whether it would have been prudent to assume that more money would have been needed, year on year. Mr Thompson explained that the situation was a very difficult balancing act and if wrong assumptions were made, such action might lead to further unnecessary cuts and/or redundancies in other areas.

The Committee noted the unsuccessful innovation bids that were submitted to the Department for Education, as detailed in the report. Questions were asked as to the reasons for the failure of the bids and the costs associated with the submission. Councillor Blackburn explained that any costs were associated with staff time, although an initial analysis would normally be carried out to assess the possibility of success. He agreed to find out the reasons for the bids not being successful and to circulate the information to Committee Members.

The Committee discussed further the escalating costs in relation to Children’s Services and questioned whether it was now time for the Council to invest more in its own children’s homes, with a view to reducing the costs paid to the private sector. Councillor Blackburn explained his belief that children thrive better in foster care and therefore additional children’s homes were not considered to be the best solution. He explained an ambition to undertake more work with the voluntary and third sector to explore possibilities for small therapeutic units within the town. He went on to acknowledge the huge costs associated with out of town placements and added the need to be realistic in terms of timescales for improvements, which should be considered in terms of years rather than months. On the subject of the ability to further increase council tax rises in forthcoming years to offset costs, Councillor Blackburn pointed out that the projected increase in coming years might raise approximately £2.5m against the projected overspend of £4m. He added that the greater the increase in tax would be met by an increase in the amount of people who struggled to pay.

The Committee expressed concern that the welfare of vulnerable children might be put at risk as a result of the mounting financial pressures and asked for assurance that no child would suffer as a consequence. Councillor Blackburn responded by explaining that such an assurance had been given following the Ofsted report into Blackpool’s Children’s Services in 2012. Decisions were based upon need and not finance, a situation that remained the case in the current time.

The Committee raised the issue of ward budget funding, pointing out that certain wards had reserves of between 25k and 30k. It questioned whether it was time to consider placing restrictions on ward budget spending with a view to the funds being diverted into Children’s Services. Councillor Blackburn responded by explaining the reasons for resisting the removal or further erosion of the ward budgets, in that the money was used to fund projects that could not be funded via other means and such projects delivered real positive change at local level. He encouraged Members to make the most of the budgets and explained that if the money remained unspent, it was likely to be removed.

The Committee discussed the current status of the former Tower Lounge premises that had previously been occupied by Harry Ramsdens and was now vacant. It questioned why such a prime and important site had not yet attracted new occupants. Councillor Blackburn pointed out that Harry Ramsdens were now occupying premises rented by the Council which was more in keeping with the tenants heritage and brand. He added that tenants were currently being sought for the Tower Lounge who understood the seasonal pressures of occupying such a site, although he was confident that due to the site’s prime location and commercial value, that it would not remain empty for a lengthy period of time.

The Committee agreed to note the report.

Background papers: None.