Agenda item

The Director of Public Health and the Mayor and Executive Member for Adult Social Care and Public Health will be in attendance to present the budget in respect of Public Health.

The Director of Public Health and the Mayor and Executive Member for Adult Social Care and Public Health were in attendance to present the budget in respect of Public Health.

 

The Director of Public Health explained that, in terms of the Council’s overall budget:

 

·        Feasible savings had been identified, however, there was a remaining budget gap of £6.279m in relation to 2024/25.

·        A Local Government Finance Settlement had been announced on 18 December 2023 and an analysis of impact would be completed in January 2024.

·        The Council’s initial assessment was that the settlement was in line with officer expectations and did not close the 2024/25 budget gap.

·        If the combined effect of the Local Government Finance Settlement and any further identified and assured budget proposals were insufficient to close the remaining budget gap for 2024/25, then it would not be possible for the Council to achieve a legally balanced budget for 2024/25.

·        Chartered Institute of Public Finance and Accountancy (CIPFA) guidance to Section 151 Officers, who were considering issuing a Section 114 Notice, was to engage with Department of Levelling Up, Housing and Communities (DLUHC) and make an application for Exceptional Financial Support (EFS) in order to agree a financial recovery plan that would avoid the requirement for a Section 114 Notice.

·        EFS would provide a temporary funding solution that planned to buy time for the Council to achieve financial sustainability and avoid a Section 114 Notice.

·        Prior to issuing a Section 114 Notice, the Section 151 Officer and Chief Executive (with the support of the Mayor and the Executive) would make an application for EFS.

·        A response from DLUHC in respect of the application, would be received prior to the Council meeting on 28 February 2024.

 

In terms of Public Health’s budget, it was explained that:

 

·        To provide assurance, there had been a need to:

o   ensure public health grant spend was compliant with the public health grant conditions;

o   establish clarity of priority public health outcomes through the development of the Public Health Strategy; and

o   develop whole Council action, through clear Service Level Agreements and public health grant allocation.

·        Without robust arrangements in place, there would have been a significant risk to non-compliant use of the public health grant. Failure to comply with the grant conditions or provision of the requisite level of assurance to the Secretary of State could have resulted in the grant payments being reduced, suspended, or withheld. Repayment of whole or part of the grant monies paid may also have been required, which would have had a significant impact on the overall financial position and reputation of the Council.

·        On 20 December 2023, the Executive had approved the Public Health Strategy and the approach for the allocation of the public health grant to the wider Council to ensure spend was in line with the grant conditions.

·        Work had been undertaken across three phases:

o   Phase 1 involved establishing the scale of risk regarding the current allocation of £4.858m.

o   Phase 2 involved the development of the Public Health Strategy. The strategy:

§  detailed the key programmes for Public Health over the next three years, clarifying the public health outcomes that would be delivered directly by Public Health and through whole Council action; and

§  outlined the principles and processes for the allocation of the public health grant and how each directorate would support the achievement of the public health outcomes.

o   Phase 3 involved the development of Service Level Agreements and governance arrangements for each of the Council’s directorates to provide assurance spend was in line with grant conditions and public health outcomes.

 

It was advised that approximately 40% of the public health grant was allocated to other directorates in the Council, such as Adult Social Care and Children’s Services. In respect of the high level of grant monies being allocated to areas other than the Public Health, the Local Authority was a clear outlier in the North East and the North East was a clear outlier nationally. It was advised that for Children’s Services, the public health grant provided 60% of the funding to deliver Early Help, which equated to approximately £1.2m.

 

Members heard that Public Health had a current gross spend budget of £18.309m, with a forecast outturn of £17.913m. Therefore, there was a favourable variance of £0.396m, which had been allocated to Public Heath Reserves. It was advised that the key driver of the favourable variance was staff savings arising from delayed recruitment to vacant posts.

 

A Member raised a query in respect of the underspend and prescribing costs. In response, the Director of Public Health explained that due to Covid-19 an increase in the cost of a particular medicine prescribed had been predicted and accounted for, however, the anticipated increase did not occur, which had ultimately resulted in an underspend for substance misuse services.

 

A Member raised a query in respect of the Service Level Agreements (SLAs). In response, the Director of Public Health explained that governance arrangements, including Council directorate SLAs, planned to monitor and provide assurance that the grant allocations deliver public health outcomes. Members heard that it was hoped that any issues regarding compliance would be resolved internally. It was highlighted that, as part of the public health grant allocation, a key element would be the development and implementation of Health Inequality Impact Assessments as part of wider Council decision-making processes.

 

A Member raised a query on the use of public health reserves. In response, the Director explained that with any underspend, local authorities were able to carry those forward as part of a public health reserve into the next financial year. It was commented however, when utilising those funds in future years, the Local Authority was still required to comply with all grant conditions. For instance, Members heard that reserves had recently been utilised to extend the delivery of HeadStart until the end of August 2025.

 

A Member raised a query regarding the risks associated with non-compliance. In response, the Director of Public Health highlighted that the Council’s robust governance arrangements planned to significantly reduce risks associated with non-compliant use of the public health grant and provide assurance that spend was in line with grant conditions and public health outcomes.

 

A Member raised a query regarding the reasons for the recent changes to the governance arrangements. In response, the Director of Public Health advised that, following the issuing of the Best Value Notice (January 2023), there had been a need to provide assurance of improvement given the significant risks associated with the public health grant allocation and meeting conditions of the grant.

 

A Member raised a query on the public health allocation to each directorate. In response, the Director of Public Health advised that an assessment needed to be undertaken to determine which areas were eligible for funding and would comply with the grant conditions. There was also a need to assess the amount of funding that could reasonably be awarded to those areas.

 

The Mayor commented that, in addition to the introduction of robust governance arrangements for the public health grant, work was also being undertaken in respect of the use of the Holiday Activities Fund (HAF) to ensure longevity and standardisation across provision. It was highlighted that there was a need for all providers to offer standard healthy food choices, treat all children in exactly the same way and support improved public health outcomes.

 

A discussion ensued regarding the opportunities and benefits associated with the holiday activities and food programme. A Member highlighted the importance of increasing awareness of the support available to families to increase knowledge of healthy food options, food preparation and cooking.

 

The Director of Place Based Delivery for North East and North Cumbria Integrated Care Board (ICB) had submitted a comment, prior to the meeting, requesting that the scrutiny panel considered the impact of the Council’s Medium Term Financial Plan (MTFP) on partner agencies. It had been requested that the scrutiny panel ensured that the plan focused on efficiencies and improvements for the system and did not simply cost shift between partners or agencies, something that all stakeholders were conscious of the need to avoid. In response, the Mayor acknowledged that all organisations were facing budgetary challenges and the importance of identifying/clarifying the responsibilities, remits and expectations of each organisation was highlighted.

 

AGREED

 

That the information presented to the scrutiny panel be noted.