Agenda item

The Director of Finance submits a report, which sets out the Council’s financial performance against its revenue budget in the financial year 2015/16.

The Director of Finance submitted a report which set out the Council’s financial performance against its revenue budget in the financial year 2015/16.

The Chair made reference to the serious budget pressures within the Children’s Services and Adult Social Care Departments. Issues around the increase in the number of Look After Children (LAC) and the difficulties in the recruitment of social workers were recognised.  The Chair added that the budget deficits were due to legitimate reasons but hoped that the shortfalls were being addressed in the 2016/2017 budget.

The Director of Finance responded that within Adult Social Care and Children’s Services there were increasing numbers of people in need of support and the Council had a statutory duty to provide help. The budget was however robust in its response to meeting those needs, taking into account the best data the Council had at the time the budget was set.

The Chair referred to the overspend on the Housing Benefit budget. The Director of Finance explained that this was due to a number of issues. Overpayment in Housing Benefit could be made to people who failed to report a change in their circumstances and such overpayments were difficult to recover as people receiving housing benefits were on some of the lowest incomes. It could take time to recover such overpayments; they might for example be repaid through an attachment to earnings.  Universal Credit started to roll out in January 2016 in Leicester and had started with single people. Couples and families would be included by 2018 and pensioners would remain on Housing Benefit.

A Member noted that there had been difficulties in recruiting suitably experienced staff in Revenues and Customer Services and queried the implications of this, particularly in the light of the continuing Universal Credit roll out The Director of Finance responded that there was a lack of experienced benefit staff generally, but the Council were trying to train and develop their own staff as much as possible. 

The Director of Finance added that Directors in all divisions were achieving savings by managing staffing issues carefully and considering options where a vacancy arose.  A Member praised efforts to make financial economies but expressed concerns that savings came with a cost to staff and services. Officers were asked whether there was any follow up to those staff made redundant.  The City Mayor responded that unfortunately, because of the financial pressures and the numbers of staff involved he had concerns that this would not be realistic, nor could such a follow up be carried out with any credibility. He would however raise this with colleagues. 

A Member referred to section 5.1 of the report which stated that there were difficulties in recruiting to vacancies in Legal, Registration and Coronial Services, and queried whether such vacancies affected Children’s Services, where there was a need for experienced solicitors. The Director of Finance responded that the private sector offered higher rates of pay to Solicitors than Local Government did and an option was to either look at market pay or a scheme whereby the Council would develop their own legal staff. Where necessary, locums or the private sector were brought into fill gaps. The Director added that she would find out and let Members know whether the difficulties in recruiting Legal Officers affected Children’s Services.

The Director of Finance added that Universal Credit was a Department of Work and Pensions (DWP) benefit and would be administered by them; however this presented a concern in that the DWP paid the tenant and the tenant then paid rent to the Council. The payment was made monthly in arrears, with the intention for people to manage their budget monthly, but there were concerns that many people were unused to this and would find it challenging.  The Council commissioned the provision of comprehensive budget advice and people could apply for the housing element of their benefit to be paid direct to the landlord if significant vulnerability could be demonstrated.  The meeting heard that some local authorities had reverted to collecting rents at the door to alleviate the risk of the tenant building up debts.

A Member questioned the help that might be available for people who were in financial difficulty. The Director of Finance explained that the Council worked with Citizens Advice and other advice providers to give advice to service users and advice sessions were held around the city on a regular basis. A suggestion was made that where there were free sessions at community facilities, they should be used to offer advice on budget management. It was noted that the Council had switched its bank to Barclays Bank and it was suggested that they might be able to help those people who were reluctant to or had difficulty in opening up a bank account. A Member expressed concerns however that people with learning difficulties might be given a bank overdraft which they would find difficult to manage.

A Member noted the income pressures at the new household waste recycling centre at Gypsum Close (Para 8.2 of the report) and expressed a hope that the Neighbourhood Services and Community Involvement Scrutiny Commission would look at this if the problem continued.

The Chair of the Housing Scrutiny Commission referred to the Housing Revenue Account and noted that there was a decrease in the number of void properties and a shorter void time per property (Para 11.3 of the report). He added however, that the Commission still had concerns and would be looking into this issue in more detail.

The Chair of the Adult Social Care Scrutiny Commission queried the reason for the £6m additional costs within the Adult Social Care budget for 2015/16. The Director of Finance responded that with the Council’s Liquid Logic I.T. system, it was possible to track the pattern of service users.  It could be seen that there was a high percentage of service users of working age who had mental health issues. It was possible that some of these service users could remain within the system, needing support, for some considerable time. It could also be seen that the cost of the package for about 20% of service users had increased by 60% over the year. There was a need to ascertain the reason for this and to understand what was happening with the caseloads.  Members commented that reduced funding for essential services resulted in stress and a breakdown within families and communities. This led to increased care needs.  The Chair of the Health and Wellbeing Scrutiny Commission commented that individual care packages could have increased because people were not receiving effective care early enough from the Health Service. The Scrutiny Commission would be looking at this issue.

The Chair of the Children, Young People and Schools Scrutiny Commission noted a reference to a Health Nurseries scheme in section 13.5 of the report and queried what this was about. The Director of Finance confirmed that she would look into this and let the Member know.

The Chair of the Health and Wellbeing Scrutiny Commission expressed concern at the reduction in spend on research and development as detailed in section 13.5 of the report. This was an issue that Scrutiny Commission would be looking at, because effective research and development could result in savings in the long run.  Members heard that consideration was being given as to how research and intelligence teams across divisions could be used more effectively.

Concerns were expressed relating to the numbers of L.A.C and the resulting costs of their care.  The Director of Finance responded that there had been an increase in numbers but a contributing factor in the increased costs was that the council needed to look further afield to find suitable providers. Some children had complex issues and providers were becoming more cautious and ‘risk aware’.

A Member commented that as well as the costs of L.A.C. and the continuing use of social workers, increased costs had been incurred as a result of the Ofsted improvement notice. The Director responded that £2.2m had been made available to Children’s Services in respect of the Improvement notice and a report would be presented to the Children, Young People and Schools Scrutiny Commission to explain how the money had been spent and what work had been carried out.

In response to a question, the Director explained that the cost of a L.A.C. could be as much as £10k to £20k per week. Some children needed very intensive support.  The City Mayor explained that costs had been looked at in detail and in response to a request, offered to provide some anonymised case studies to Members. A Member sought assurances that the council were pursuing the Health and Education Services for their share of the costs of providing for LA.C, so that the Council’s contribution was not the largest part of the total cost. The Director confirmed that the Council were now more vigorous, than they had been, in pursuing health and education funding.

A Member referred to Section17.5 of the report and sought assurances that investment in the city centre was not at the expense of the outer estates. The City Mayor responded that a very high proportion of capital expenditure was directed at the neighbourhoods and areas where people lived and this was becoming an increasing priority.  At the same time it was right to invest in balance in the city centre; it was in effect the Leicester’s ‘shop window’ and had been shown to the world during events such as King Richard III and the Leicester City Football Club celebrations. Potential investors such as IBM were shown around the city centre and subsequently had chosen to bring their business to Leicester.

AGREED:

that the overall position presented within the report be noted.