Social Services’ £50m Overspend

Local authorities overspent on social services by more than £50m last year, according to figures released this week.

The record overspend has increased by 257% since 1998-99.

Steve Thomas, chief executive of the Welsh Local Government Association (WLGA), said much of the costs came from providing home care and housing children who needed to be in a separate county from their families.

The figures come at the same time as the WLGA is lobbying the Assembly Government for more than the below-inflation 2.3% rise in funding allocated in its draft budget.

It has identified £26.4m in the budget it argues could be used to protect frontline council services without taking money from the NHS or preventing the Labour-Plaid Assembly coalition from pursuing flagship policies. This would give local government a 3% rise in funding.

Mr Thomas yesterday said providing for “looked after children” cost local authorities approximately £120m.

He said, “The difficulty is, how do you budget for it? You will never know how many will come through the system – it’s not like other council services.”

Mr Thomas said councils had to make up for the extra spending by finding savings elsewhere.

He said, “Councils, unlike our colleagues in the NHS, are not allowed to run up deficits. These overspends must be dealt with within existing budgets – there’s no overdraft.”

Shadow Health Minister and Cardiff North AM Jonathan Morgan said, “These figures are truly astonishing. Local authorities across Wales are already facing serious pressures when it comes to delivering social services.

“Budgets are being stretched beyond their limits. This not only has implications for social services departments, it also impacts on the National Health Service and their ability to deal with issues such as hospital bed blocking.”

Mr Thomas said the WLGA’s alternative budget would remove “anomalies” in the budget, and expressed surprise at the scale of the increase in funding for efforts to combat climate change.

Its report states, “The draft budget proposes that specific programmes on climate change should be increased from £3m to £8m, an increase of 160%, with limited information on what these programmes will be. We suggest that the rate of increase should be limited to 130%, transferring £1m to the [grant for] councils, allowing local government to align its programmes in support of this important objective.”

The report further warns, “[No] council is adequately funded and yet a range of Assembly services get increases well above inflation. In this climate we have warned that service cuts, job losses and high council tax rises are inevitable with particularly onerous pressures on the three councils (namely Powys, Anglesey and Conwy) with settlements at 1% to 1.1%. This is the worst settlement in Assembly history.”

But, despite the trenchant language, Mr Thomas was confident that the intensity of the debate between council leaders and Assembly Ministers has not damaged their ability to work together.

He said, “As they say in The Godfather, ‘This is business. It’s not personal’.”

A Welsh Assembly Government spokesman said, “It is legitimate for an authority to have a higher outturn figure compared with its budgeted spend for a particular service, provided that the authority’s overall expenditure is managed within the resources available.

“The Assembly Government will be undertaking, over the next 18 months, a comprehensive review of funding of social services in Wales over the next 10-15 years including the impact of demographic and service trends.”