Agenda item

Mr L. Breckon CC, the Lead Member for Resources, has been invited to attend for this item.

The Commission considered a report of the Director of Corporate Resources which provided an update on the 2022/23 revenue budget and capital programme monitoring position as at the end of period 6 (end of September) and an update on the approach to reviewing the County Council’s property assets.  A copy of the report marked ‘Agenda Item 10’ is filed with these minutes.

The Chairman welcomed Mr L. Breckon CC, Cabinet Lead Member for Resources, to the meeting for this item.

Arising from discussion, the following points were made:

(i)       The situation looked very depressing as a result of the rise in inflation and the continued increase in demand and costs, particularly regarding Special Education Needs and Disability (SEND) services.  It was recognised that SEND was the single biggest issue facing the Council with the High Needs Block (HNB) cumulative deficit currently at £39m, with demand still rising.  
 

(ii)      Whilst it was recognised that this was a national issue, some Members commented that SEND services had become dysfunctional and were simply no longer working.  This was demonstrated by the rising number of complaints received by the Council and by Members individually.  The County had previously had one of the best records for SEND, but the position had deteriorated significantly in recent years and Members questioned why and what was being done to address this.

(iii)      Members noted that following the reforms introduced by the Care Act in 2014 it quickly became apparent that demand would increase but no additional Government funding would be provided to support this.  A Member commented that the Children and Family Services Department had done its best, but that it had been very difficult given the vast rise in demand for Education and Health Care Plans (EHCP) which could not have been foreseen up to that point.  This was a national issue, but Leicestershire had also seen a 30% higher rise than other areas.  Pressure on staff recruitment and retention also impacted the ability of the service to respond as quickly as it would like to that rise in demand. 

(iv)     The latest Green Paper did not look to change the position any time soon.  It was suggested therefore that the Council had to try and address the continued pressures itself through improved local systems and practices. The Director reported that the Council had applied for grant funding of £1m to support the Council’s Transforming SEND and Inclusion in Leicestershire programme.  It had also brought in external strategic partners, Newton Europe, to help bring forward this programme.  The total investment into improving the Council’s SEND services was in the region of £9m. 

(v)      The Director confirmed that the SEND funding for the Authority was roughly mid-tier in terms of spend per capita, so it was thought that more could be done to ensure the overall budget was targeted more effectively.  The Leicestershire SEND Programme would work to deliver this.

(vi)     Members noted that the Children and Family Services Overview and Scrutiny Committee had recently received a report on the programme at its meeting in September, and progress updates would be received regularly throughout next year.  It was suggested that a copy of that report be circulated to Scrutiny Commission Members for information.

(vii)     A Member commented that a number of children were placed with independent providers which was more expensive and questioned what was being done to reduce this.  It was noted that the Council was seeking to increase its own local provision which would be significantly cheaper.  Funding for a new special school in Quorn was being sought but this would only provide limited spaces and whilst helpful would in no way address demand pressures.  The DfE bidding process would also take time.  The Director emphasised that whilst creating more local SEND places would play a part, the key aim of the Council’s Transforming SEND and Inclusion in Leicestershire programme would be addressing demand and to shift resources so that less children were placed in independent special schools, instead being supported in mainstream education. 

(viii)    Whilst this approach was welcomed, a member commented that an added difficulty would be that Leicestershire primary and secondary schools were also under significant pressure, being lower funded than most other areas in the country.  Reductions in education funding in recent years did not help the Council’s position and addressing fair funding for schools, as well as for the County Council would therefore be important.

(ix)     A Member commented that it was worrying given its current financial position, that the Council might be asked to contribute to the reduction of the HNB deficit.   Members noted that the DfE was running two programmes.  One was called the ‘Safety Valve’ programme which targeted those local authorities with the biggest HNB deficits.  In this scheme the Government provided a package of support including money to help address that deficit.  Such authorities were, however, still required to put in significant amounts of their own resources, including reserves.  Members noted that the Council was not in this programme at present, but had been placed in the lower level, ‘Delivering Better Value’ programme.   Members acknowledged that some local authorities in this programme, including the County Council, might at some point in the future be moved into the ‘Safety Valve’ programme if their position deteriorated.  A Member suggested that more should be done to ensure MPs were fully aware of the Council’s position and that current circumstances were simply not sustainable.  More Government support was needed.

(x)      Whilst it was recognised that progress against the Council’s Transforming SEND and Inclusion in Leicestershire programme would be monitored through the Children and Families Overview and Scrutiny Committee, it was suggested that more detailed consideration of SEND service pressures by the Scrutiny Commission would be beneficial given its wider impact on the Council’s overall budget, transport services, risk and complaints.

(xi)     In response to questions raised, it was noted that property clean-up costs for Firs Farm had been accounted for in the previous financial year.  The income shown in the report which was net of operating costs was therefore a fair figure to use in terms of showing the Council’s return on a revenue basis.

(xii)     Members acknowledged that the Council operated a sinking fund to cover costs arising from its property portfolio from time to time.  This was standard practice to deal with big spikes in expenditure.  In response to questions raised, the Director confirmed that this fund was financed by income generated by the Corporate Asset Investment Fund and was offset against the income generated by those assets in the accounts.  It did not come from the Council’s central budget and no new money had been added to compensate any spikes in cost as had occurred last year as a result of Firs Farm.

(xiii)    When planning permission was obtained on any part of the Council’s rural estate, the value of that land was revised in the Council’s accounts as appropriate.  These sites were then assessed to determine the best approach in terms of sale or retention to ensure the best gain for the Council, balancing both short and longer term benefits.

(xiv)    If the County Hall campus were to be sold, the capital value for the site, whilst still substantial would be affected by the cost of demolition and re-development.  The site was also complex providing a range of services and alternative premises would need to be sourced requiring a significant multi-million-pound capital investment (likely more than might be generated from the sale of the site).  Members were assured that care was taken to keep the position under review and to ensure rental income was maximised where possible to make sure retention of the site was justified from a financial and operational perspective.

(xv)    A Member suggested that whilst a Scruitny Review Panel on the Ways of Working Programme had been carried out the previous year, an update with regards to its impact on the Council’s property assets might be beneficial.

(xvi)    Regarding the forecasted net slippage of £12.6m on the Corporate Asset Investment Fund, Members noted that this had resulted from the Council’s decision not to pursue a proposed site purchase. 

(xvii)   The Corporate Asset Management Plan covered primarily the Council’s operational assets.  Whilst they might generate an income in part, this was not the focus of the Plan.  The focus was to ensure the Council continued to make the best use of those sites and to ensure these continued to meet its operational needs.

RESOLVED:

(a)  That the update on the 2022/23 revenue budget and capital programme monitoring position as at the end of period 6 (the end of September) be noted;

(b)  That the update on the Council’s approach to reviewing its property assets be noted;

(c)  That a copy of the report presented to the Children and Families Overview and Scruitny Committee in September regarding SEND and Inclusion be circulated to Scruitny Commission Members for information;

(d)  That consideration be given to the presentation of an item on SEND to the Scrutiny Commission having regard to its wider impacts on the Council’s budget, transport services, risk and complaints;

(e)  That the Director of Corporate Resources be requested to provide an update on the Ways of Working Programme and its impact on the Council’s property assets.