Agenda item

·        To select appropriate items from the Cabinet agenda for pre-decision scrutiny (cabinet reports enclosed for Scrutiny Members)

·        To select appropriate items from the Cabinet (Finance) Sub Committee agenda for pre-decision scrutiny (Cabinet Finance Sub - Committee reports enclosed for Scrutiny Members)

The Committee scrutinised the following Cabinet Board items:

Budget Monitoring and Update Report 2021/22

Members were provided with an update in relation to current budget projections for the 2021/22 financial year.

Officers highlighted that the Council was very early on in the 2021/22 financial year and that the report was a budget monitoring update position calculated as at the end of May 2021 and projected to the end of March 2022. It was stated that at present, it was forecasted that the Net Authority budget will underspend this year by £178k; there were some variations reflected in the report, along with a number of assumptions that Welsh Government would continue to provide monies from the Local Authority Hardship Fund to support both increase costs and loss of income. It was mentioned that Officers were still waiting for clarification on some of those monies and Members will be updated on the position on a by-monthly basis.

The circulated report predicted that there would be an increased number of children having to go into residential care; Members asked if this was as a result of the lockdown pressures on vulnerable families. The Director of Social Services, Health and Housing confirmed that there was a significant increase in mental health issues amongst young people as a result of the lockdown pressures; there was also an increase in the number of families that were in significant distress as a result of being confined together for long periods of time. It was stated that there was a protracted period in which the Council wasn’t able to provide its intensive support packages to families within their homes, due to the virus and the safety issues around doing so; the normal outlets that families had to reduce stresses, such as children going to school, also weren’t available. The Committee was informed that as a result of this, there was an increased pressure across the Looked after Children sector and in particular the residential care sector; it was predicted that 3 or more extra placements would be needed this year. Members were reassured that where children need to be taken into care or have their needs met within residential care settings, this will be done; and also when appropriate, reuniting children with their families.

In relation to elderly residential care, the report stated that from September 2021 there could be a reduction in the amount of financial support which could impact on the viability of some care settings and providers. Members expressed their concerns with this and asked if Officers could expand on this statement further, elaborating on what the consequences would be for the Directorate and the wider Council. Members were informed that Welsh Government had been providing financial support to residential care homes that were below the threshold of 90% occupancy; in September 2021, Welsh Government planned to reduce this. It was mentioned that there were some caveats to this, however Officers weren’t aware of the details as of yet. The report highlighted that if the reduction in financial support by Welsh Government was not handled cautiously, then the Council would predict that a significant number of care homes could be left in an un-viable position financially; meaning that some care homes may need to close down, leaving fewer care homes for the future. Officers stated that depending on the outcome, the Council may need to step in to support the sector financially; there will be a detailed report presented to the Social Care, Health and Wellbeing Scrutiny Committee which will include some of the predications.

A discussion took place in relation to the under spend in ‘other community care/direct payments’; it was asked whether the under spend was related to the pandemic and the possible delays in assessment for those needing care. It was confirmed that the sector was having issues with recruitment into domiciliary care and with providing direct payments due to the impact of Covid; there was also a number of domiciliary care workers who had contracted the virus and become very ill, and were therefore not working. Officers stated that this was issue for Councils across Wales and England and was something that needed to be looked at nationally.

It was asked if it was possible, going forward in the by-monthly reports, to include the balance from previous years in the general reserve balance summary. The Director of Finance and Corporate Services stated that there wouldn’t be any benefit in viewing the balance from previous years, as there would have been so many different impacts throughout the various years; it would not provide any meaningful information as the balance of the current year was the figure of real value.

Following scrutiny, the Committee was supportive of the proposal to be considered by the Cabinet Board.

Treasury Management Monitoring Report 2021/22

The Committee received a report which set out treasury management action and information for the first quarter of 2021/22.

Detailed in the circulated report, it stated that the Bank of England warned that the pandemic will result in a ‘sharp and large’ economic shock; Members asked what measures the Council had planned to deal with such drastic cuts.Officers highlighted that there was a lot of speculation going across the financial markets as to how the UK Government was going to balance its forward looking budgets post Covid 19; at the moment they were working on a comprehensive spending review which was due to be announced in November. It was mentioned that there were lots of different messages being communicated out of the Government; until some of those go through that particular spending review and the Chancellors budget statements, that were due in November, the Council will not have any real certainty in regards to how much money was being invested in public spending. Members were informed that work had been undertaken by Wales Fiscal Analysis and the Institute for Fiscal Studies in England; the Welsh analysis seemed to suggest that the public funds for Wales could increase by 0.9% next year or potentially up to 2.9% for future years. It was noted that if this was the case, it would be a significant challenge, especially as the pandemic had not ended and Covid 19 had an impact on the way in which the overall finances were managed. In terms of the arrangements, it was mentioned that Officers were looking to develop a Forward Financial Plan to present to Members in the autumn period and there would be an All Member Seminar towards the end of September; these would provide Members with an indication of the assumptions that were being built into the plans for 2022/23 and onwards.

Following Scrutiny, the report was noted.