English councils overspend on children’s services by £800m

23 Aug 18

Government figures out today revealed the pressures on children’s services as English councils overspend by £800m in this area last financial year.

English local authorities forked out around £8.85bn on providing services for vulnerable children in the 2017-18 financial year, according to provisional figures from the Ministry of Housing, Communities and Local Government.  

Although, the budget for these services outlined in June 2017 was £8.03bn.

The overspend comes despite increasing the children’s services budgeted expenditure for 2017-18 by 2.5% compared to the year before.

Paul Carter, chair of County Councils Network and leader of Kent County Council, said counties had “little choice” but to overspend on children's services. 

He said: “In a climate of rising demand, inflation and substantial funding reductions imposed by central government, counties have delivered extraordinary efficiencies, but without extra resource the worst is yet to come in service cutbacks to prevent huge margins of overspent in statutory services.”

The CCN said in English counties the number of children taken into care stood at 26,000 in 2017, compared to 22,600 in 2011 - a 15% increase.

The organisation said county councils overspent the most in children’s services - £264m more than they budgeted.

Paul Dossett, head of local government at consultancy firm Grant Thornton, said: “Children’s services have faced challenging savings targets over a number of years.

“These figures demonstrate the extent to which local authorities are struggling to cope as demand continues to rise, which is heavily linked to pressure on council resources and the wider impact of austerity and benefit reform on the more deprived parts of the country.”

Director of the New Local Government Network Adam Lent told PF: “This will just add more focus to the fact that children services are now as much, if not more, of a financial pressure on councils as adult social care.”

He called for more investment from government so councils could focus on preventative children’s services.

He told PF: “We know that those councils that have moved to a preventative model have had better performance and have saved money, but the problem is that requires up front investment”.

He believed the MHCLG figures should be evidence to the government that council's needed a long-term financial settlement for all services, similar to the NHS.

“I think this is another piece of evidence that piles yet more pressure on the chancellor to change the situation in local government in the autumn budget,” Lent explained. 

“Constant, short-term, stopgap solutions are unsustainable as a way of funding local government.” 

Finding up front investment is difficult, Lent said, in a sector that has seen a 50% reduction in government funding since 2010-11m, as highlighted by the National Audit Office earlier this year. 

A recent study by the think-tank Localis found that councils were struggling to meet demand for children’s social care.

A CIPFA survey, released in November last year, found children’s social care was now the biggest concern for council chief financial officers.

Despite the overspend on children’s services, MHCLG’s local authority revenue expenditure and financing figures showed councils underspent in some areas. 

Councils underspent on highways and transport to the tune of £340m, while there was a £270m underspend in adult social care.

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