Agenda item

To receive a report which provides an overview of the Cheshire East Council final outturn for the financial year 2024/25.

The Committee received the report which provided an overview of the Cheshire East Council final outturn for the financial year 2024/25 and the financial performance of the Council relevant to the committee remit.

There had been an improvement of £1.9m since quarter 3 in Children and Families closing with an overspend position of £3.5m.

The contributing factors behind the overspend in Children and Families included children’s social care placements, the use and cost of agency staff, home to school transport costs and school catering.

The overall DSG deficit was £112.1m at the end of the year which was an improvement on the budget gap as determined by the Council’s DSG Management Plan that was reported to Children and Families Committee in April 2024.

During discussions concerns were raised in respect of the implications if the statutory override was not extended. Officers report that if that was the case and the council had to pay back the reserve the council would instantly be in S114 territory. Cheshire East Council was not alone in this, and officers agreed to share a list of other Local Authorities who were in a similar position.

It was noted that the DSG management plan spanned 7 years, with the plan that income would match expenditure, but that 5 years remained, and risks would persist.

Concerns were expressed in respect of the 59% capital spending figure and there was a request for a breakdown of this figure. Officers clarified that Children & Families capital items were primarily grant-funded and that the 59% figure was council-wide.

Members hoped that the upcoming spending review would provide some clarity which would support better decision-making and discussed the importance of having certainty in the direction of travel to inform future planning and budgeting.

RESOLVED (by Majority)

That the Children and Families Committee

1. Considered the overall financial performance of the Council in the 2024/25 financial year, as contained within the report, as follows: a) A Net Revenue Overspend of £17.6m against a revised budget of £365.8m (4.8% variance) funded by conditional Exceptional Financial Support (Capitalisation Direction) via borrowing. b) General Reserves closing balance of £6.3m. c) Capital Spending of £88.4m against an approved programme of £215.8m (59% variance).

2. Considered the contents of Annex 1.

3. Approve the new Reserves in the Reserves Section (Annex 1, Section 5, Table 1) which includes proposed movements to reserves.

4. Recommend to Council to approve the Supplementary Revenue Estimate (SRE) Request for Allocation of Additional Grant Funding over £1,000,000 as per Annex 1, Section 3, Table 1.

5. Approve the Children and Families Committee Supplementary Revenue Estimates (SRE) Request for Allocation of Additional Grant Funding (Specific Purpose) over £500,000 up to £1,000,000 as per Annex 1, Section 3, Table 2.

6. Approve the Supplementary Capital Estimates (SCE) and Capital Virements between £500,000 and £1,000,000 in accordance with Financial Procedure Rules for the following Committee’s as detailed in Annex 1, Section 4, Table 4

7. Recommend to Council to approve the Supplementary Capital Estimates (SCE) over £1,000,000 in accordance with Budget and Policy Framework Rules as detailed in Annex 1, Section 4, Table 5.