Cheshire West and Chester Council is already facing a £6.7m hole in its annual budget just a third of the way through the new financial year.
A rise in mental health care needs and spending on agency social workers to plug staff shortages in its children’s department are two key drivers of the overspend, the council’s ruling cabinet will be told this week.
The figures cover the four months between April 1 and July 31 and show an overall deficit of £13m, which has been offset by cost-saving actions and underspends in some departments to reduce the figure by £6.3m.
A report to the cabinet also revealed an additional overspend of £9.6m on the dedicated schools grant (DSG) - ringfenced money earmarked for education, with pressures on special educational needs provision being one of the reasons cited.
The report said adult social care has seen an overspend due to wider continued pressures on services, specifically what it called a ‘significant increase’ in the external care costs relating to mental health, with an 11.4 per cent increase in care packages.
Children’s social care spending has gone over budget due to what the report said was employing agency social workers to cover vacant roles at a cost of £2.7m.
The report said there were also continued long-standing budget pressures in other areas such as homelessness services, park and ride, markets income, commercial property income and parking and enforcement income and that ‘further actions’ were required to permanently address these pressures.
It said that council departments had identified £6.3m of potential savings.
Measures include:
- Reducing the use of agency staff in the services with highest usage.
- Reviewing 2024-25 savings proposals to ensure delivery in year and considering if any future year savings proposals can be delivered earlier.
- Developing strategic plans to reduce income shortfalls within markets, parking and enforcement, and property.
- Developing a commissioning framework between adult social care and VIVO (the council’s supported living service) to ensure services provided by VIVO can be delivered within the agreed budget.
- Reviewing opportunities to reduce the cost pressure and demand on Adult mental health services.
The authority is also planning to scrutinise all non-pay related spending over £5,000 and may not fill some vacant staff posts.
The report said the council currently had £26.2m in reserves and that if the overspend was not tackled, this would reduce that amount to below the level of acceptable financial risk, requiring further cuts or savings further down the line.
The report added: "This would seriously affect the financial resilience of the council and a plan would be required to return the general reserves balance to an appropriate level in the next financial year."
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