Wokingham Borough Council’s Executive heard an interim update on the borough’s finances for the current financial year when it met on Thursday, July 26.
While the housing revenue account was on target, there were some overspends across the various portfolios managed by the council.
The search for a new chief executive will cost an additional £15,780, while other staffing issues needed approval of an additional £67,580.
The general fund is overspending by 1.3%: an additional £1.7 million over a planned spend of £126.4 million. This relates to people services.
The document approved by the council noted: “This reflects continued significant pressures in adult social care commissioned care and support for Older People and, in particular, Learning Disability. In addition, continued pressures on Home to School Transport reflects the increasing costs associated with SEN services.
“While there has been significant investment in Learning Disability budgets in recent years, the number of individuals living longer, and being supported to live independently in the community, has continued to exert budget pressure.
“The impact of the national living wage has driven increases in placement prices across the sector. While the number of older people being admitted to care home settings is reducing as more people are supported in their own homes, care home spend has continued to rise reflecting increasing cost of placements.”
Schools also need an additional £1.6 million against a planned spend of £136.9 million.
The report noted: “The overspend on the DSG relates to ongoing pressure on the High Needs Block, in particular in relation to placements made out of borough and with independent special schools.
“The number of pupils with SEN within Wokingham has risen by almost 15% since 2015/16, with the proportion of those with Social, Emotional and Mental Health or Autistic Spectrum Disorder increasing beyond that seen both nationally and across South East local authorities.
“Demand for suitable placements has out-stripped that available locally, resulting in an increasing reliance on costly independent and out of borough provision. This in turn has increased pressure on Council funded home to school transport budgets.
“As at 31st March 2019, the estimated DSG balance will be a deficit of £1.593m. An action plan to address this deficit is referred to later in this report and involves close working with the DfE.”
Update on return on investments
An update was also given on the council’s treasury management strategy – the return on its investments.
Its external debt as of March 31 was £65.5 million in the general fund and £79.8 million in the housing revenue, while the investment return for the financial year 2017/18 was £1.3 million, an average investment return rate of 1.68%.
The report noted the returns were: “a significant favourable variance, particularly in the current financial climate”.