Agenda item

Councillor Vaughan welcomed Hitesh Jolapara, Strategic Finance Director and Emily Hill, Head of Corporate Finance.  In addition to providing a corporate perspective, the presentation provided an overview of the MTFS for Adult Social Care (ASC).  The national real terms department budget changes indicated significant growth. For example, ASC increased by 10% starting in 2010, with everything else in decline.  Funding in real terms from the Department for Communities and Local Government (DCLG), had decreased significantly over 2010-16.  Local Government expenditure GDP (Gross Domestic Product) was 6.5% in 2010, decreasing to 4.5% in 2016, with a downwards trend continuing to 2022 and beyond. 

Pension budgets nationally increased by 34% in cash terms, but cash for ASC nationally had flatlined and reduced slightly. Since 2010/11, a reduction in government grant of £70 million reflected a 54% reduction in real terms. Plans to localise national non-domestic rates (NNDR) had been shelved, however London was one of several areas within a pilot scheme, which was on-going and NNDR for London had just been agreed (a potential benefit of £2.6 million).  Review of fair funding for local authorities analysed all key parts of the funding formula and was briefly explained.  Loss of funding for London, was often a gain to the shires.

Budget papers were subject to formal agreement at the February Budget Council meeting.  The approach was to freeze Council Tax again, and not to apply the ASC precept.  Nationally there were assumptions around this, Government modelling for the 2018/19 LGFS assumed 3% Council tax increase, which was likely to be the case with most other local authorities.

The Westfield Expansion would bring in £2.2 million; and statutory fees and charges for parking, children, adults, and housing would be frozen, unless a statutory increase was levied.  Developer contributions from S.106 funding amounted to £1.7 million and would fund more police officers in the borough.

Referring to the H&F resources forecast, a 2% increase had been budgeted for with assumed expenditure such as pay inflation.  For financial planning, a headroom of £6 million per annum was assumed from 2019/20 onwards, to allow for increased costs of care packages and in costs imposed by providers. 

Hitesh Jolapara explained that budget setting was not just about income or efficiencies, but allowed for growth, highlighting the £1.3 million Better Care Funding (BCF) input. Focusing on a high-level summary of income for next year, it was explained that there was £2.9 million in growth across all departments.  The Finance and Development Policy and Accountability Committee had considered a full set of budget papers. This was a balanced budget, but cumulatively there was a huge challenge of meeting a £40 million funding gap.

Lisa Redfern, Director for Adult Social Care presented the MTFS for ASC, providing an overview of challenges and achievements. ASC’s key purpose was to promote independent care for residents and to keep people at home for as long as possible. Funding for ASC had decreased since 2010 but demand for services had increased.  More people lived alone, with greater acuity of need, requiring a high level of care to enable them to live at home which was costly as the cost of care continued to rise.  ASC wanted to ensure high quality of care standards, which required an enhanced performance framework, aiming for outstanding care rather than just good. Public perceptions of what constituted a good standard of care had also changed. Delayed discharge was being addressed to ensure that people spent less time in hospital. People came out of hospital with huge care needs, but the cost was lower to the NHS, although this created new challenges for the ASC budget.  Ensuring a high quality workforce was a challenge in ASC across the board. 

Lisa Redfern said that she was very proud of what had been achieved by ASC, delivering successes with less money and more demand.  No resident in the Borough had been charged for home care since 2015, and this had been achieved within a balanced budget and with efficiencies.  Services addressing delayed discharges had been both responsive and high performing.  CIS had been nominated for two Local Government Chronicle awards. 

Lisa Redfern said a balanced budget continued to be increasingly demanding but had been managed for 2017/18; and despite obstacles and with continuous improvement, many good achievements had been possible.  She said the savings strategy consisted of four overall strands:

1.    FDDM – Joint Front Door Demand Management, less siloed working across service teams; and smarter working, utilising new technology;

2.    Commissioning strategy – Redesign of care pathways, for example; 

3.    Whole systems and integrated service offer – Considerable work was required to shift the focus to integrated care; and

4.    Review of workforce costs – Efficient working. 

Prakash Daryanani, Head of Finance (ASC) provided a corresponding financial perspective.  The ASC Medium Term Transformation and Savings Strategy amounted to 19% of the total strategy.  He said there were opportunities to make savings, arising from the disaggregation of the tri-borough services. To illustrate, there could be closer working with Public Services Reform (PSR) and Children’s Services and services such CIS, which had worked well.  The risk to the ASC budget was that it was a demand-led service. This had to date been managed well.  However, the year-on-year increase in demand, the risks around health budgets, increased inflationary costs and the London Living Wage presented significant challenges. 

Prakash Daryanani provided budget headlines for 2018/19, highlighting ASC net expenditure budget 2017/18 of £59.353 million, and extra Council funding to cover London and national wage increases and market pressures of £1.249 million.  In terms of the ASC gross spend, 15% was spent in-house for services, with staff and back office running costs amounting to 4% of the spend, and 70% used to fund externally provided community services.  The overall trend analysis indicated an 11% increase in spending, with a reduction in the baseline budget and an increase in direct payments.  There was no change to fees and charges.

At 9.58pm, the Committee agreed to suspend the guillotineand the meeting was extended to 10.30pm, to allow for the conclusion of remaining business.

Councillor Carlebach sought clarification regarding the reasoning behind the non-application of the social care precept. He was surprised, given that other councils of all political colours were applying this. Councillor Coleman responded that the Administration at the last election had promised to reduce council tax and keep it low, and it was keeping its promise.

Bryan Naylor highlighted concerns about social isolation and loneliness.  He stated that there were 195,000 older people living in the Borough, which was estimated to grow by 34%, by 2040.  The Older People’s Commission (OPC) recognised that 75% of older people said they were lonely.  The cost of addressing this would fall to ASC, with the financial benefits being accrued by the NHS.  He observed that health services took the view that older people “bed block” and increased costs as a result.  The perception amongst older people was that the number of step-down beds was being reduced and he asked if this was a trend. 

Lisa Redfern explained that they were working with health colleagues and carers, to enable greater prevention measures.  She acknowledged that they needed to get better at tackling issues earlier, including how cases were identified. It was becoming increasingly important to look for more creative solutions, as a community and tackle social isolation and loneliness.  This was a critical area of work both for the Administration and for the Health and Wellbeing Board. 

The increase in demand was also a critical factor and current funding did not meet the costs of essential care, which continued to be an incredible challenge.  Lisa Redfern explained that more step-down beds had been purchased. However, availability and quality continued to be a concern.  The State of Social Care Report 2016 indicated that 80% of residential and nursing home beds were Care Quality Commission rated as good but there were variations in industry standards. 

Victoria Brignell thanked the Administration for abolishing homecare charges. Referencing her personal experience, she highlighted worrying concerns regarding inconsistencies in areas of responsibility and the demarcation between ASC and Health services.  Lisa Redfern apologised for any distress this had caused and offered to assist, following the meeting. It was explained that some high-level care packages were funded by health and some were jointly funded.  Lisa Redfern provided assurances that if health funding was not offered, ASC retained a duty of care.

Bryan Naylor commented that one factor that reduced demand was navigating the care pathway, for which proper guidance was needed. Lisa Redfern welcomed the comment and suggested that this be addressed by the OPC in their ongoing work. 

Councillor Vaughan thanked officers for their presentation and commended the achievements made by the service, despite significant and debilitating funding reductions. 

RESOLVED

That the report be noted.