Councils in England overspend by over £800m on children’s care services as local authorities struggle to meet escalating demand

CCN Latest News, CCN News 2018 | 23 August 2018

New figures released today by the government have revealed that councils in England overspent by £816m on protecting vulnerable children in the last financial year, as demand for children’s services continues to rise.

A County Councils Network (CCN) analysis of the figures show that in 2017/18, county authorities overspent the most in children’s services, spending £264m more than they budgeted. Overall, councils spent 10% more than they had budgeted for that year on the service.

Councils say the overspends are due to escalating demand for children’s care services, meaning that resources are having to be diverted from other services. Nationally, expenditure on highways, transport, and libraries fell.

CCN figures show the extent to which demand has risen within children’s services over the past few years, driving overspends. The number of vulnerable children in county areas placed under a child protection plan – which means they are at significant risk of harm – was 25,259 in 2017, compared with 18,702 in 2011 – a 35% rise.

The number of children taken into care in England’s counties stood at 26,000 in 2017 (over half of the country’s entire total), compared to 22,600 in 2011 – a 15% increase.

Responding to today’s figures Leaders of England’s largest councils have said that faced with rising demand for services they have had “little choice” but to overspend millions on vital care services to protect the vulnerable and elderly.

Cllr Paul Carter, chairman of the County Councils Network, and leader of Kent County Council, said:

“Today’s figures show the stark reality facing counties, who have had little choice but to overspend millions on vital care services to protect the vulnerable and elderly.

“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 such huge margins of overspend in statutory services.

“Demand-led costs largely beyond our control mean that county authorities face funding pressures of £3.2bn over the next two years. This is compounded by the fact our councils receive 62% less funding per head compared to London. Overspending on certain services means that cuts will need to be made to other vital services, or taken from reserves. These two approaches are unsustainable.”

These figures come following a recent warning from CCN that plans to strip back services and offer only a basic ‘core offer’ of services to local residents could be become the norm in county councils, with these councils facing a funding shortfall of £3.2bn over the next two years.

Services for children’s and adult social care represent 65% of county authorities’ budgets, higher than all other types of councils.

Due to growing demand-led pressures in these areas, figures produced by the network showed their councils face funding pressures amounting to £3.2bn over the next two years alone, £1.8bn of which is due to projected demand and future inflationary pressures.

To prevent overspends in areas such as children’s and adult social care, county authorities need to deliver £1.39bn worth of savings by 2020.

A survey of county leaders recently showed that unless Government provides additional funding there are rising concerns they will not be able to deliver balanced budgets in the coming years. With no detail on the long-term funding plans for councils beyond 2020/21 just one third (33%) were confident they will be able to deliver a balanced budget that year without an extra cash injection. In total 66% are ‘not confident’ or ‘neutral’.

Cllr Carter added:

“With county authorities spending on average two-thirds of their budgets on adult social care and children’s social care, they are undoubtedly under the most intense pressure, as evidenced by Northamptonshire and East Sussex recently. Counties have delivered the largest efficiencies in the public sector, but there is a limit as what can be delivered with current resource. To prevent catastrophic consequences, it is essential that government responds to our calls for additional resource in advance of the social care green paper, the spending review, and fair funding review.”

Notes to editor