County Council plans to fill £37m budget shortfall

A report published today (September 28) describes how Kent County Council (KCC) aims to fill its forecast £37m budget shortfall in 2023-24.

KCC’s Budget Recovery Plan, which will be discussed at a Cabinet Meeting on 5 October, looks at the actions needed to bring this year’s budget back into balance and to set the course for getting the council back to financial sustainability, securing the services that residents in Kent need the most, within the resources available from central government and local taxation.

The council is facing an enormous rise in the cost of, and demand on, its services. The most significant pressures are in adult social care, home to school transport, and children’s services.

The most significant overspends were:

• £30.5m older persons residential and nursing care
• £16.1m home to school transport
• £9.9m children in care

The report highlights that, although making the necessary savings this year is achievable, these are mostly one-off measures. The key challenge is putting in place actions to minimise future spending increases.

Work is underway to tackle the areas where budget pressures and overspend are most acute, which is primarily in social care services and home to school transport. A concentrated focus now includes:

• Every area of KCC to restrict spending where possible.
• All services to identify future targeted savings.
• Review of spending from reserves.
• Review of all assets with a view to possible disposal (surplus property already identified).
• Review of spending growth and savings opportunities in adult social care and children’s services.
• Review of strict compliance with existing policy.
• Managers to avoid non-committed spending for remainder of this financial year.

Some of the shortfall has been brought down by using £25m of council reserves and a grant from the Market Sustainability and Improvement Fund amounting up to £9.4m.

‘Reach stability and continue to deliver services’

Deputy leader Peter Oakford said “Our plan to Secure Kent’s Future sets out a clear path to ensure that we do everything within our power to reach stability and continue to deliver services that residents need.

“However, the enormous financial pressures faced by local authorities across the country need to be addressed by central government. Our message to government is very clear. The current mix of the funding county councils receive, and the responsibilities they have, is unsustainable.

“Government needs to fully fund rising cost pressures on social care. If they were to do that, we, and a lot of other local authorities, would not be in the position that we are in today.  Additional funding needs to be sustainable as the increased costs we have faced relate to ongoing care and transport packages for individuals which are unlikely to reduce during their duration.  One-off funding will not address the structural deficit we currently have on care and home to school transport spending.

“I believe that if government don’t start looking at funding in this area, then an awful lot of upper tier authorities across the UK will be in a death spiral, because they will just have to stop providing any service that isn’t statutory.

“It is really important to all of us that we continue to deliver a good service to everyone in Kent, that we fight the battles that we have to fight, and that we bring this council out of the other side of the challenges that we currently face.

“If we work together, we can do it but, as this report shows, it’s going to be very difficult indeed, with some difficult choices along the way.”

Unique pressures

KCC’s challenges as a council are similar to, but proportionately larger in scale given Kent’s size, to many upper-tier local authorities the length and breadth of the country.

As the Gateway to Europe, there are some pressures unique to Kent that collectively compound the pressures KCC is facing. The border challenge and asylum system create additional pressure on the county’s children’s services compared to other local authorities. KCC has a range of important responsibilities for Unaccompanied Asylum Seeking (UAS) Children under the Children’s Act.

The well documented failings with the National Transfer Scheme for UASC therefore place additional pressure on Kent, as it holds the corporate parenting responsibility when the stated policy intent of the Government is for all local authorities nationwide to share that responsibility.

‘Secure the future of the county’

Leader of KCC, Roger Gough said “My priority as Leader is to make sure that we not only deliver on this budget recovery plan but, in doing so, we absolutely ensure that we secure the future of the county, continue to provide the services that our residents need and, most importantly, set KCC on a path to financial stability and resilience in the future.

“The government needs to understand that the rapidly rising cost of providing vital statutory services has had an enormous impact across everything that we do. As a local authority we are having to direct funds away from the areas that residents tell us they most value, in order to fund social care and all the other services that we legally have to provide.

“For now, we are doing the very best that we can with the money we have, and I am confident that the actions being taken in every part of the council will ensure we manage to balance the budget into 2024-25 and beyond.”

Cllr Oakford added “The media myth that we are close to declaring an S114 is just that – a myth. There is no getting away from the stark reality that our finances, like every local authority up and down the country, are massively challenging.

“However, when you manage an annual budget of £1.3 billion, a gap of £37 million, although a very substantial amount, is something that I know we can control.”

The council aims to save £11.4m for the remainder of the year by avoiding nonessential spending in areas such as recruitment of staff to vacant roles, agency staff, use of external venues for meetings, professional fees, and supplies and services.

Prevention cheaper than cure

County councillor Karen Constantine, who represents Ramsgate, said: “Kent County Council does indeed face significant challenges.

“Any further cuts in services will be felt by members of the public who have no choice but to rely on these vital services. A very large part of this problem has been caused by the Conservatives insisting on cuts to funding. Central Government have systematically axed grants to Local Authorities. They ‘fell by 17.5% between 2009/10 and 2019/20, before partially recovering. However, in 2021/22 it was still 10.2% below 2009/10 levels.’

“It’s proved impossible for authorities to move successfully into income generation. Along with a culture of contracting out and commissioning, services have been disrupted and fragmented. This means – despite the best efforts by of those employed to undertake valuable care work and other roles, there is confusion, duplication and ultimately residents do not get the services they need and pay for.

“When services fail people, then often the cost of putting matters right further down the line, proves to be even more costly. It’s better to deliver a great service and get it right first time. It’s time to accept that public services are an investment that will all benefit from. Prevention is better – and cheaper – than cure.”

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