At a Glance
- Around 97% of the council’s total forecast overspend is concentrated within statutory Children’s and Adult Social Care services, with high-cost children’s care placements continuing to be a significant financial pressure.
- Work to manage within the existing budget is being intensified across all services, building on action already taken to reduce financial pressures, with strengthened financial controls and an accelerated Transformation Programme.
- The increasing complexity of some children’s needs is driving demand for highly specialist placements, adding significant pressure to statutory social care costs.
- Action already taken to tackle rising children’s placements costs has delivered around £2.9m in savings safely this year, through enhanced scrutiny and active management of placements.
- National shortages of suitable children’s care placements continue to drive up costs, with demand outstripping supply across England.
Tuesday 25 August 2026
Southend-on-Sea City Council’s latest financial performance report shows that increasing pressures within statutory social care continue to drive the council’s forecast financial position for 2026/27.
At the end of the first four months of the financial year, the council is forecasting an overall overspend of £13.291m for 2026/27. Around 97% of that pressure is concentrated within Children’s and Adult Social Care, while the vast majority of other council services remain within budget or are managing comparatively limited pressures.
The increasing complexity of care needs and the rising cost of specialist provision continue to place significant pressure on social care budgets. In Children’s Services alone, one residential placement currently costs more than £1m a year (over), with a further eight costing more than £500,000 each annually.
These pressures are not unique to Southend. Across England, shortages of suitable children’s care placements mean demand continues to outstrip supply, driving up the prices councils are required to pay to meet their statutory responsibilities.
The council has been actively working throughout the year to reduce these pressures, including strengthened scrutiny and management of children’s placements which has already delivered around £2.9m in savings. Existing recovery work is now being intensified further, bringing together strengthened financial controls, directorate-level recovery plans, targeted budget challenge and accelerated transformation through a Strategic Budget Recovery Plan.
Cllr Daniel Cowan, Leader of the Council, said:
“No one is underestimating the challenge we face, but we aren’t waiting to act. We’ve strengthened scrutiny of high-cost placements, challenged prices and care packages, increased oversight of spending and accelerated work to reduce demand and costs. In Children’s Services alone, that work has already delivered around £2.9 million in placement savings this year.
“We’re now intensifying that work further across the council, with tighter controls on discretionary spending, recruitment, consultancy and purchasing, alongside accelerating transformation and challenging every service to identify further opportunities to reduce costs.
“It is also important to be clear about where the problem lies. Around 97% of our forecast overspend is concentrated within statutory Children’s and Adult Social Care. Across the vast majority of other council services, budgets remain well managed and the services residents rely on continue to be protected.
“But local taxpayers simply cannot continue carrying the can for social care markets that are fundamentally broken. Whether it is the escalating cost of adult care packages or children’s placements costing more than £1 million a year, councils are being asked to absorb costs that simply aren’t sustainable.
“We raised our concerns about children’s placement costs directly with Government earlier this year and will shortly be meeting senior officials in the department to press the case for reform. We welcome the work already underway nationally, but we need reform that delivers better outcomes for vulnerable people and better value for taxpayers.”
Cllr Paul Collins, Cabinet Member for Finance and Transport, said:
“This report demonstrates that the seriousness of the in-year financial situation and we have a clear understanding of where the pressures to our budget are coming from.
“We successfully mitigated around £4 million of pressures last year through active demand management, improved oversight, and efficiency measures.
“The stark challenge we face is not a lack of financial control but that statutory social care service demands are outpacing available budgeted funding and market reforms. Our task is to continue improving services whilst maintaining a sustainable position for the future. That includes strengthening our budget recovery arrangements, challenging how we deliver services, and learning from best practice elsewhere in local government to ensure every pound is delivering maximum value for residents.”
The report also shows that around 80% of the council’s planned savings and additional income for 2026/27 has already been achieved, while transformation activity has delivered more than £4m in financial benefits across the organisation.
The council will continue to accelerate its Transformation Programme, backed by £8m of planned investment in 2026/27. This investment is focused on modernising services, improving productivity and reducing the council’s ongoing costs, helping to create a more efficient and financially sustainable organisation.
The report also highlights the budget recovery measures it is putting into place to focus on strengthening its long-term financial resilience through bringing forward transformation projects, efficiency, and service redesign.
Read the full report Agenda for Policy and Resources Overview & Scrutiny Committee on Wednesday, 2nd September, 2026, 6.30 pm – Southend-on-Sea City Council