Finance bosses warn Rotherham Council of £7.7m budget black hole

The largest department for overspend is Children and Young People’s Services – with a forecast spend of £3.6m over budget.

Regeneration and Environment Services are also facing a £3M overspend.

£1m of the overspend relates to the “wider financial impact of the war in Ukraine, inflation and energy price increases”.

RMBC has had to make £11.5 M of savings, including “reductions in social care teams linked to reducing caseloads”, and reablement services.

Cost reductions from the council’s buildings and “increased income from Waleswood” also add to the total.

A financial update, presented to Rotherham Council’s cabinet this morning (July 11) puts the overspend down to inflation and price increases caused by covid and the war in Ukraine.

It adds that “placement pressures” and “school transport pressures” are straining the budgets for children and young people’s services and regeneration and environment.

The report adds: “The forecast position will continue to be monitored closely and mitigations identified to enable a balanced outturn position can be delivered, though it is estimated that the Council will need to call on reserves to achieve a balanced outturn position.

Councillor Saghir Alam, cabinet member for corporate services, community safety and finance told today’s meeting: “This financial report is for the first two months of the year.

“As of May 2022, the council currently estimates a directorate overspent of £7.7 million for the financial year.”

Some of the pressure on the budget for children and young people is due to an increase in placement costs for looked-after children, as well as a reduction in the dedicated schools grant due to a reduction in education placements .

Councillor Victoria Cusworth, cabinet member for children and young people’s services added that further placement pressures were due to “the growth in independent fostering agencies recruiting foster carers and us not recruiting in house.”