Tower Hamlets children’s services face £10.5m budget black hole

The 10 councils with the highest expected overspends. Picture: Archant

The 10 councils with the highest expected overspends. Picture: Archant - Credit: Archant

The department which looks after thousands of vulnerable children in Tower Hamlets faces a budget black hole of £10.5 million, a year after being rated “inadequate” by inspectors.

Analysis of 101 councils responsible for children’s services by the Bureau of Investigative Journalism and shared with the Advertiser reveal Tower Hamlets has the largest projected overspend in London – and the third largest in the UK.

Tower Hamlets Council linked the budget pressure to “increased demand” for children’s services after the threshold for help was lowered last year.

With three quarters of local authorities reporting overspends in these departments and Tower Hamlets promising an extra £5.1m funding over the next financial year, experts warn of a “perilous state” facing the struggling services.

“It’s no surprise that they are overspending as they struggle to cope with slashed budgets and soaring demands,” said Dr Sam Royston, director of policy and research at the Children’s Society.

Staffing costs went £2.6m over budget in Tower Hamlets, with agency staff filling more than a third of social work roles.

“When budgeting we assumed staff costs would average out at the mid-point salary scales, but the reality has seen costs closer to the top,” read a council report.

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Ofsted noted “widespread and serious failures” across children’s services in the borough in a damning report last April.

More than 3,000 children were identified as being “formally in need” of help, with 401 “subject to a child protection plan”.

Though the service has not been fully reinspected since, inspectors described improvements as “encouraging” during two follow-up visits in December.

No children were “at risk of immediate harm”, inspectors noted.

A spokesman for Tower Hamlets Council said: “Like many other councils, we are seeing an increased demand for children’s services, most of which we have a statutory duty to provide.

“Since April 2017, the children’s social care team has seen its caseload increase by 15pc, with 41pc more monthly contacts and 66pc more referrals. There have also been other additional costs including in education, family support and support for community organisations.”

The council aims for a “good” service rating by April 2019, he added.