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Children’s Services heading for £5m overspend

Created on 07/11/2019 @ 10:19
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By Elgan Hearn, Local Democracy Reporter

The spiralling costs at Children’s Services is continuing to cause concern for Powys County Council, (PCC) as they could be £5 million overspent by the end of the financial year.

And if things stay as they are, PCC could be spending more of their reserves to produce a balanced budget than is safe for them to do so.

Portfolio holder for finance Cllr Aled Davies told the latest cabinet meeting that there was a slight improvement with the projected overspend being £62,000 less than it was at the end of August, said to be £3.398 million.

This financial year PCC need to make savings worth £21.692 million and of that total, £9.171 million still needs to delivered. But assurances have only been given that £3.438 million can be delivered.

Cllr Aled Davies said: “Of the £9 million we need to deliver, £3.4 million can be and we have concerns over the other part.

Cllr Davies explained that PCC holds £9.1 million in a general reserve fund and if the position stayed as it is until the end of March 2020, the overspend would need to be financed from that fund.

This would leave the general reserve at £5.432 million which would be just under the council’s target of 3% of total net revenue budget. Cllr Davies added that unachievable savings had grown to £5.733 million.

“The efficiency savings are a crucial part of trying to balance the budget to the end of year,” said Cllr Davies.

Children’s Service budget is now forecast to be £25.550 million, over £5 million more than its budget of £20.331 million.

Portfolio holder for Children’s Services, Cllr Rachel Powell, defended the department: “I need to emphasise that this is an unpredictable service, we have lots of strategies in place to bring our children closer to home for all the right reasons.

“The additional spending is down to workforce and placement costs.”

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