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Chief departs as city helps bail out children's company's £5.7m deficit

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Sunderland City Council is set to invest an extra £4m a year in its children’s services company to address a £5.7m budget shortfall, following the sudden departure of the organisation’s chief executive.

A report considered by the council’s cabinet on Wednesday says Together for Children’s (TfC) board identified the shortfall at a meeting in December “primarily as a result of increased numbers of looked after children… and the continued use of agency social workers”.

Alex Hopkins

Alex Hopkins

Alex Hopkins

The cabinet agreed to provide additional contract funding of £4m “on an ongoing basis…to enable the company to rebase their [sic] budget.”

A document submitted to Companies House and signed by TfC’s finance director David May shows Alex Hopkins, who was chosen to lead the council-owned company ahead of its launch in April last year, left the organisation on 1 December.

The company has declined to give a reason for Mr Hopkins’ departure.

TfC’s director of performance and quality Sue Carty has been appointed interim chief executive, with statutory director of children’s services functions being covered by Fiona Brown, Sunderland’s executive director of people services.

The cabinet report said the council had been providing additional officer “support and challenge” in response to the company’s forecast financial position.

It adds: “The council will be working intensively with the company during the last quarter of 2017-18 to carry out extensive due diligence on the increased forecast, and to develop an action plan that will allow the company to operate within a sustainable funding envelope that is affordable.”

TfC said the additional investment, which will be considered at a full council meeting on 7 March, was part of routine budget negotiations and in response to an increase in the number of families needing support.

In a statement, the company added there had been a 17% increase in permanent staff since the company was launched, with turnover of staff now lower than the national average.

It said: “Ofsted have carried out five monitoring visits to the city since July 2015 and have reported steady or sustained progress being made after each and every one.

“In the latest Ofsted monitoring visit to the company in October, inspectors noted that Together for Children is ‘making sustained progress in improving services for children in need of help and protection’ adding that they have seen ‘positive steps in recruitment to the new company’.”

TfC was established after an Ofsted report 2015 revealed a “corporate failure” by senior leaders and managers in the city that left vulnerable children and young people unsafe.

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