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Torbay fends off s.114 fears despite imposing spend moratorium

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Financial pressures in children’s services have forced Torbay Council into a moratorium with restrictions on non-urgent spending worth more than £1,000.

While a section 114 notice has not been issued, there are concerns about rising costs and a predicted overspend.

Chief executive Steve Parrock has told councillors that the first quarter budget monitoring report is showing a forecast overspend of more than £2.8m this year. Torbay has a net revenue budget of £112m in 2018-19.

Mr Parrock said the main reason for the moratorium was “a substantial increase in the number of children looked after”, whose numbers had increased by 20% since November 2017 and 10% since the start of this financial year, reaching 357.

The council also faced the cost of employing 50 agency staff in children’s services to meet safeguarding demand, and had increased the service’s budget by £3m to £31.9m for this year. Mr Parrock said this increase in looked after children was “a nationwide issue and not specific to Torbay”.

Torbay also faced pressures from larger than expected numbers of other agency staff, including in planning and payroll.

The council has not issued a section 114 notice, but Mr Parrock told councillors: “Given the expected and severe medium term challenges, it is important that we do not use our reserves at this time if possible, hence the moratorium.

“Even if an activity or contract is budgeted for, the task or expenditure may be postponed or cancelled if the work is deemed not urgent by the chief finance officer or myself. In essence, we will slow down or stop non-urgent expenditure.”

Under the moratorium all new contracts or spending in excess of £5,000 must be approved by the chief finance officer and spending of more than £1,000 by a director.

When asked specifically by LGC if a section 114 notice had been issued, a Torbay spokeswoman said: “There is no reason for the chief finance officer to issue such a notice, and the measures taken relate to an immediate in-year budget pressure only. The mayor expects to issue his draft budget in November as per normal.”

Mr Parrock told councillors that Torbay was “in a better financial position than some councils which have hit the headlines recently”, specifically citing East Sussex and Somerset CCs and Birmingham City Council.

“For example, we have not run out of money or needed to use our general fund reserves…we have delivered the planned ‘year on year’ savings and made the necessary cuts as agreed in previous budgets,” said Mr Parrock.

The town’s elected mayor Gordon Oliver (Con) in June suggested that Torbay’s difficulties meant it might have to revert to being a Devon CC district, or form a larger unitary with neighbouring councils. 


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