Meeting documents
Cabinet
Wednesday, 15th January, 2003
|
Bath & North East Somerset Council |
|||
|
MEETING: |
Council Executive 15th January 2003 |
||
|
TITLE: |
|||
|
WARD: |
ALL |
||
|
AN OPEN PUBLIC ITEM |
|||
|
List of attachments to this report: Appendix A : Comparison of SSA changes with Family Appendix B : Additional Technical Adjustments and Budgetary Pressures |
|||
1 THE ISSUE
1.1 The purpose of this report is to support the financial plan proposals for allocation of resources made for Social Services in future years. It responds to the Council resolution from February 2002 for the Director of Social & Housing Services to produce "An outline plan with options for appreciably reducing, over a 5-year period, the Council's current excess Social Services spending compared to its "Standard Spending Assessment". This report will also give broad themes of the direction of travel for Social Services over the next five years.
2 RECOMMENDATION
Endorse the strategic framework set out in this report aimed at containing growth in Social Services spending to that proposed in the draft financial plan.
3. FINANCIAL IMPLICATIONS
3.1 Included within the report.
4. BACKGROUND
4.1 In 2002/03 the Social Services budget is 27% in excess of the Standard Spending Assessment (SSA). Since the establishment of Bath and North East Somerset Council in 1996, Social Services has ranged from being 10% over SSA in 1996/97 to 7% in 1998/99. The overall increase in budget compared with FSS (SSA) has been due largely to the following:-
¬ investment by the council to meet the significant pressures being faced by Social Services,
¬ More accurate analysis of support service recharges as charges in the first few years since the Council was established in 1996/97 were on an estimated basis.
¬ Changes in the SSA formula that led to this council receiving poorer settlements than other councils (see appendix A). Between 1998/99 and 2001/02 the council increase in SSA was one of the lowest of our family. The council in effect lost 5% compared with the average of the family due to formula changes. This has partly been addressed in 2003/04 as our settlement was one of the higher increases.
5. NATIONAL PRESSURES
5.1 It is recognised nationally that there have been significant pressures facing Social Services and these continue.
5.2 A joint survey by the Local Government Association (LGA), Association of Directors of Social Services (ADSS) and Society of County Treasurer's (Treasurer Societies) was published in February 2002. Its findings were as follows :
¬ Local authorities in England had set budgets for social services for 2001/02 at 10% over SSA. 87% of authorities were predicting overspends in that year of on average 2% of budget. The budget for this council at that time was 22% over SSA and was 1.5% overspent.
¬ The main pressure nationally was on children's services with the greatest pressures on residential care and foster care including specialist fostering placements. This is in line with the pressures for our council.
¬ The next significant pressures were on services for older people and learning disability services, particularly independent sector placement fees. This again, is in accord with the pressures for our council.
6. 2003/04 BUDGET SETTLEMENT
6.1 The settlement for Social Services in 2003/04 gives a Formula Spending Share (FSS) of £32.291m. After allowing for technical adjustments and the `pick-up' of grants within FSS the increase is in effect a 5.9% or £1.5m increase.
6.2 The settlement includes a resource `equalisation' to increase the baseline FSS in recognition that the majority of council's spend well in above of formula spending (previously SSA). This resource equalisation means that after allowing for changes within the financial plan and changes to grant funding, social services will be approximately 11% above SSA. This does not allow for the additional pressures that have been identified. These are summarised in Appendix B.
7. PROPOSED TREATMENT WITHIN THE FINANCIAL PLAN FOR 2003/04 BUDGET ONWARDS
7.1 It is proposed within the draft financial plan report that from 2003/04 the approach for Social Services is revised to be in line with the methodology used for Education. This will mean that increases in FSS (previously SSA) are `passported' to Social Services i.e. they will automatically be given but the service will have to contain all its financial pressures within that. This will be based on the actual cash increase in the FSS (SSA). This will lead to a gradual reduction in expenditure over FSS (SSA). It is estimated that using this model will mean that Social Services will be 13% over SSA in 2003/04 compared with the 27% in the current year.
7.2 A summary of the budget changes for Social Services would be as follows :
2002/03 Base Budget £31.873m
Passport within SSA £3.353m
2003/04 Base Budget £35.226m
7.3 The impact for Social Services after allowing for budget pressures highlighted in Appendix B is as follows:
2002/03 Base Budget £31.873m
Changes within Financial Plan £2.305m
Additional Technical Adjustments £0.846m
Additional Budgetary Pressures £1.980m
£37.004
Less Efficiency Savings (£0.385m)
Further savings to be identified (£1.393m)
Total savings required (£1.778m)
7.4 It can be seen that the application of the "ring-fence" methodology to social services is to apply an upper cap on spending growth. At a 5%year-on-year spending increase, this may appear generous. However the reality of current spending pressures is such that significant budget reductions will be needed in order for the department to manage within its new cash limit.
7.5 Proposals to close the projected 2003/04 gap will be brought to the Council Executive as part of the February draft budget papers.
8. DIRECTION OF TRAVEL
8.1 The Senior Management Team has identified the broad themes for achieving a reduction in expenditure over the next five years. These are:
¬ Comparison of Expenditure profile with family of authorities.
¬ Comparison of activity profile with family of authorities.
¬ Identification of key themes where further work on identifying proposals for reductions should be pursued.
9. COMPARISONS WITH FAMILY OF AUTHORITIES
9.1 An overall comparison of the SSA blocks show that the main areas where we spend above SSA are in Children and Adults (aged 18 to 64), with expenditure being below SSA on older People. This profile has changed with the revision to the SSA formula in 2003/04 so that the spending for older people is very near SSA.
9.2 Analysis of the major differences in unit costs between authorities in Bath and North East Somerset's CIPFA family of like authorities shows that the Council expends:
(1) High levels of expenditure ( in comparison with the average) on :
(a) People with Learning difficulties
(b) People with Mental Health Problems
(c) Nursing care for older people
(d) Residential services for people with learning difficulties, mental health problems or physical disabilities.
(e) Family support services.
(2) Low levels of expenditure ( in comparison with average) on:
a) People with a physical impairment
b) Residential care for older people
c) Community equipment
d) Services for looked after children
e) Adoption services
10. NATIONAL PRIORITIES FOR EXPENDITURE
10.1 Adults Services will be required to make significant improvements in response to referrals of older people. By the end of 2004, all first contacts will have to be made within 48 hours, with all aids and equipment needed to assist daily living for disabled people in place within a week (the current target is 3 weeks). The Government expects that local authorities will be able to afford higher fees to nursing and residential care homes, and increase the number of intensive home care packages. Community equipment must be free of charges and Councils will be obliged to offer direct payments i.e give cash payments to people so that they can purchase their own care rather than receive care arranged via the council. Whilst such improvement to services to older people are desirable, they cannot be effected at no cost.
10.2 In Children's Services the focus has been on the continuation of Quality Protects and an extension to "choice protects" requiring an increased focus on improvements to fostering and adoption services. In addition new responsibilities for prevention work to reduce the risk of social exclusion to children and young people are being introduced. Again such improvements are desirable but cannot be effected at no cost. Any future services for children must also be informed by major statements of values, such as the United Nations convention on the Rights of the Child, and the national objectives set by the government.
11. KEY THEMES FOR RESHAPING SOCIAL SERVICES.
11.1 Work has been taking place to re-shape services in order to address the imbalances in funding and to modernise them. This has specifically been achieved through the use of specific government grants targeted on the areas within the government's priorities.
11.2 In addition the following areas are being explored for reducing relative expenditure against FSS (SSA).
(1) Targeting Services by limiting or specifying provision.
(a) This means reviewing eligibility criteria for services and ensuring that staff are applying the criteria consistently. In adult care this also relates to the implementation of Fair Access to Care Services.
(b) A review of statutory services will also be carried out in adult and childcare to determine the impact of limiting provision to those services the Council is required by statute to provide, though it is recognised that some non-statutory services reduce the demand for more expensive statutory provision at a later stage.
(2) More Effective Care Management
(a) This involves reviewing care pathways for adults and children to ensure standards of service are appropriate and that there is not duplication or waste.
(b) In child care this includes establishing clear timescales for out of authority placements from the outset and establishing what needs to happen to achieve a return to local resources.
(3) More effective performance monitoring and quality improvement
(a) The replacement of the Social Services Client Records Index will enable more accurate and improved monitoring and auditing of data. This will also enable greater control and earlier intervention or corrective action.
(b) The replacement of the Financial Management System will also enable improved financial reporting and information for managers. We will be investigating ways of combining monthly activity and financial data from the two new systems.
(c) The government's PSA programme, if successful, will draw on additional income and provide an incentive for improved performance in some key areas such as the home care service.
(4) Improving the cost effectiveness of services delivered or purchased
(a) Proposals for integration of mental health and learning difficulties services with Health are being investigated to determine whether they will lead to reductions in overheads and cost sharing.
(b) The review of Home Care Service is anticipated to lead to a significant reconfiguration of services. The main objective is to ensure an intensive short-term rehabilitation period at an early stage to maximise the opportunity for people to remain independent (and hence receive lower levels of service in the longer term). The second objective is to increase the use of block contracting with the independent sector to reduce costs.
(c) The development of a family centre to replace a day nursery is increasing the scope for working with more families and children.
(5) Reconfiguring services to prevent the need for complex intervention, or to provide such intervention locally rather than by out of area organisations.
(a) Over the last year there has been a major shift to shift to establish supported living services for adults as an alternative to residential care. This will be an ongoing programme.
(b) Evidence has shown that commissioning and investing in local services for adults and children means that we would be able to bring back locally the many people that are placed (usually in residential care) out of area. These local services have been shown to produce better outcomes for individuals and are more cost effective.
(6) Maximising the funding available to meet the needs of service users.
(a) Creating more flexible resources through shared funding with health organisations and other department's e.g. Education. This includes the setting up of pooled budgets.
(b) Charging for services or increasing charges for services for those that are able to pay.
(7) Consider whether any service areas would benefit financially without deterioration in quality from externalisation.
12. SUMMARY
This report offers a strategic direction for reshaping the way in which Social Services are delivered that should generate efficiencies enabling the services to stay within the anticipated resource envelope for the next 3 years.
13. CONSULTATION
13.1 This was sent to the Trade Unions on 24th December my comments received will be reported at the Executive Committee.
|
Contact person |
Jane Ashman, Strategic Director, Social and Housing Services |
|
Background papers |
SSA(FSS) data provided by the Department of Health Key Indicators Graphical System (KIGS) data provided by the Department of Health on Local Authority Expenditure |
Additional Technical Adjustments and Budget Pressures
£k
Technical Adjustments
Free Nursing Care Transfer to NHS -£1,300k high risk this will be
removed
Building Care Capacity Grant transferred to FSS £988k
Promoting Independence Grant transferred to FSS £133k
Residential Allowance Grant transferred to FSS £1,025k
Total Technical Adjustments £846k
Budgetary Pressures Risk of failing to contain
Delayed Discharges 300 high
Less Estimated Grant (300)
Nil
Domiciliary Care Placements £200k medium
Independent Sector Fees £1,000k medium
Fairer Charging 0k medium
Children's Placements £780k low/medium
Total Budgetary Pressures £1,980k
Overall Changes £2,826k