Council set for huge £5.5m overspend as cost of social care soars

The rising costs of social care are impacting local authorities up and down the country

Sefton Council is forecasting a £5.5m overspend in its budgets for adult and children’s social care. Like many local authorities, the borough of Sefton is reporting increased demand and complex needs as the main drivers of the soaring costs and is now looking at ‘cost control’ measures to balance their books.

The Overview and Scrutiny Committee for Regulatory, Compliance and Corporate Services convened at Bootle Town Hall on Tuesday night to discuss a variety of issues including a progress report on Sefton Council’s annual budget for 2024/25. One of the priority agenda items was the financial expenditure report which detailed how council spend is progressing against their yearly forecast.

According to the report the forecast outturn up to July of this year shows a net overspend on services of £4.144m, which is attributed to potential additional pressures within Adult Social Care and Children’s Social Care. The excess finances funnelled into these services actually equates to an overspend of £3.5m on children’s social care and £2m on adult social care – these figures are mitigated in the overall budget by an approximate £1.3m in savings across the council’s wider budget.

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The £5.5m overspend represents a sizeable portion of the council’s budget and is an ongoing concern for Sefton Council and numerous local authorities across the country. A recent report published by the Local Government Information Unit on local government finance showed spending on children’s services, including support for children with special educational needs and disabilities (SEND), is the biggest short-term pressure facing local authorities struggling to balance their budgets.

In addition, analysis by the Association of Directors of Adult Social Services revealed local authorities’ adult social care budgets are skyrocketing and face the “worst financial outlook” in seven years. Both the rise is costs for adult and children’s social care are attributed to increasing demand, rising levels and complexity of need and costs being shifted from the NHS.

The report from Sefton Council stated: “Like all councils, the service is experiencing growth pressure with demand for services and we are seeking to meet the cost of this within the resources available.

“As would be expected with a budget of this size and volatility, this remains a key risk during the current year, with the added uncertainty of whether additional winter pressures or other grant funding would be received in year.”

Besides the overspend on social care, the council reported a favourable financial outlook and said the majority of services are in a balanced position. The local authority said work is ongoing to balance the budget by the year’s end and will look at further savings opportunities and further cost control measures to achieve financial sustainability.