The Overview and Scrutiny Board of Middlesbrough Council met on Tuesday 7 July 2026 to discuss a range of important issues, including the final report of the Children's Scrutiny Panel on out-of-area specialist provision, revised terms of reference for council engagement with faith and belief groups, and the corporate performance and financial outturn for the 2025/26 year. Key decisions made included endorsing the recommendations of the Children's Scrutiny Panel's report and accepting the revised terms of reference for council engagement with faith and belief groups.

Final Report of the Children's Scrutiny Panel - Out of Area Specialist Provision

The Board received and endorsed the final report of the Children's Scrutiny Panel concerning out-of-area specialist provision for children with Special Educational Needs and Disabilities (SEND) and complex needs within social care. The report concluded that while out-of-area placements are sometimes necessary due to gaps in local provision, specialist expertise, or parental preference, Middlesbrough Council has sound processes and quality assurance in place for commissioning these placements. The Panel noted the significant cost variations between local and independent provision, which impact the High Needs Budget, but acknowledged the positive efforts made to reduce reliance on out-of-area placements through developing local capacity and collaborative relationships with providers. The report welcomed the secured funding for a new secondary school for children with SEND in Middlesbrough, which will expand local specialist provision. It was highlighted that Middlesbrough has the lowest use of independent special schools in the Tees Valley, performing favourably against regional and national averages. The Board was informed of a well-developed workforce development approach within SEND and Inclusion services, which is seen as a key driver in reducing reliance on specialist and out-of-area placements. This approach is supported by comprehensive training programmes, multi-agency collaboration, and accessible learning resources. The report also noted the Government's proposed reforms to the SEND system, which will influence future workforce development and the new SEND and Inclusion Strategy 2026-2030.

In relation to social care, the Panel recognised that some level of external provision will always be required, but noted the significant costs associated with external children's residential placements. Officers are actively negotiating and challenging costs to secure best value. The Board was encouraged by the work on 16+ supported accommodation and the shift from high numbers of 'spot placements' to increased block occupancy rates, which deliver efficiencies. Similarly, the expansion of 18+ support provision is welcomed as a pathway for young people leaving care. Best practice measures in Middlesbrough for out-of-area social care placements include the use of regional commissioning frameworks, block contract arrangements for residential provision, and active placement monitoring. Proactive placement management has led to improved outcomes for children and significant cost avoidance. However, the Panel identified areas for further development, including a less developed workforce development strategy in children's social care compared to SEND, and the need for further development in foster carer recruitment, retention, and training. Continued investment in local provision and strengthened regional collaboration, working towards a Regional Care Co-operative, will be essential to further reduce reliance on out-of-area placements.

The Board ordered that:

• Children's Services be approached for a response to the query regarding Middlesbrough having a higher percentage of children requiring an EHCP than the national average.
• Children's Services be approached for a response to the query in relation to what actions were being taken to reduce the number of children looked after in Middlesbrough.
• The recommendations contained in the Final Report be endorsed and referred to Executive.

Revised Terms of Reference - Council Engagement with Faith and Belief Groups

The Board agreed to accept the revised Terms of Reference for the Board's short review into Council engagement with Faith and Belief Groups. The revised terms aim to understand how faith and belief groups interact with Council services, partnerships, and community cohesion; examine how Middlesbrough Council considers religion or belief in decision-making and service delivery; and identify strengths, gaps, and risks in current approaches, including issues of inclusion, fairness, safeguarding, and barriers faced by different faith and belief communities in engaging with the Council.

Corporate Performance Year-End 2025/26

The Board noted the report on the Council's corporate performance at year-end 2025/26. The report indicated that progress towards expected performance standards was achieved in one of the five corporate performance disciplines: Council Plan workplan. Executive actions were at 85% on target, but below the 90% expected standard. Council Plan outcome measures were at 25% (10 out of 40), and the Strategic Risk Register was at 71%. Programme and Project Management performance was at 78%, also below the expected standard. The report highlighted that the Council Plan 2024-27 outcome measures were influenced by factors outside the Council's direct control and had significant lags in data publication. A key learning point from the review of these KPIs has been taken forward into the refreshed Council Plan outcomes for 2026/27. The report also detailed proposed amendments to Executive actions and Council Plan workplan actions, along with the progress and position of the corporate performance disciplines. Two strategic risks were removed from the Strategic Risk Register: Failure to have strategic partnership working and Failure to deliver transformation successfully.

The Board ordered that:

• The relevant service area be approached for further information regarding the disposal of Newham Hall action referenced in appendix 1 of the report.
• The information presented be noted.

2025/26 Revenue & Capital Year End Outturn

The Board noted the Council's final Revenue and Capital Year End Outturn position for 2025/26. The final revenue outturn was an overspend of £1.793m, which is to be met from the Savings Delivery Risk reserve. Despite this overspend, usable unrestricted reserves increased from £21.654m to £25.941m, an increase of £4.287m. The overspend was largely attributed to demand-led services, particularly Children's Social Care, which reported a £7.455m overspend due to high-cost placements and workforce pressures. Adult Social Care also reported an overspend of £1.272m. The Dedicated Schools Grant (DSG) showed a cumulative deficit of £29.317m.

The Capital Programme for 2025/26 had an underspend of £33.031m against the revised budget, with £32.052m reprofiled into future years. New externally funded schemes totalling £1.057m were approved for inclusion in the Capital Programme.

The Board ordered that:

• The Director of Finance present the Treasury Management Report to the next meeting of OSB on 29 July 2026 to address questions of Council borrowing.
• The Director of Finance provide detailed costs associated with the entry Section 106 Marton West Beck in Appendix seven (Revised Capital Programme).
• The information presented be noted.

Deferred Items

Items nine and ten, concerning the service overview of Legal and Corporate Services and the Overview and Scrutiny Board Work Programme 2026/27, were deferred to the next meeting on 29 July 2026 to allow the Mayor to be present.

Other Matters

The Board noted that there were no declarations of interest received at the start of the meeting. The minutes of the previous Overview and Scrutiny Board meeting held on 15 April 2026 were approved as a correct record. Updates were received from the Chairs of the Place Scrutiny Panel and the Adult Social Care and Health Scrutiny Panel. The Children's Scrutiny Panel's initial meeting had been delayed due to a recent Ofsted inspection, with the report expected on 21 July.