The Strategy and Resources Committee are scheduled to meet to discuss financial and performance updates, commissioning of sexual health services, the investment property portfolio, and facilities management contracts. The committee will also be considering a motion to exclude the public and press from the meeting for certain items of business.

Finance and Performance

The committee will be provided with an update on the council's financial and other performance for the first quarter of the 2025/26 financial year.

The report pack indicates that the forecast general fund revenue outturn is an overspend of £1.262m, which assumes the use of the general contingency to mitigate service pressures. Adult social care is reported as the primary cause of the council's overspend, with a forecast pressure of £2.513m. Children's social care is forecasting a £0.700m overspend, while education is forecasting an underspend of £0.634m, primarily due to a forecast £0.551m underspend on SEN Transport costs. The Environment, Housing and Neighbourhoods directorate is forecasting a £0.444m overspend, predominantly due to ongoing challenges with temporary accommodation.

The forecast outturn for the Dedicated Schools Grant¹ (DSG) is an overspend of £12.627m, which will be added to the deficit brought forward of £10.573m, resulting in a total forecast cumulative deficit of £23.200m to carry forward. The overspend is driven entirely by the High Needs Block² (HNB), which is forecasting a £12.89m pressure. The report pack states that the expenditure within the HNB is impacted by an increasing number of Education Health and Care Plans (EHCPs)³, which grant a statutory right to have additional care and support.

The outturn for the Housing Revenue Account⁴ (HRA) is a forecast underspend of £0.404m, primarily due to a £0.306m saving on interest payable and a £0.751m saving on the revenue contribution to capital outlay. These savings are partially offset by a forecast £0.855m shortfall on rental income, predominantly due to voids.

The council's 2025/26 revenue budget incorporated £12.024m of savings. The current forecast is for £11.358m to be delivered, indicating an under-delivery of £666k. The budget included £21.315m of growth funding, but the latest forecast indicates that the required growth will be £24.562m, a shortfall of £3.247m.

The report pack also includes an update on the government's Fair Funding Reform 2.0 consultation, which is a proposed overhaul of the system for allocating central government funding to local authorities in England. The council has submitted a response to the consultation, confirming disagreement with elements of the consultation, and reiterating that the same concerns have been raised in the response submitted by London Councils on behalf of all boroughs. The council response highlights that Sutton is supportive of the response submitted by London Councils. According to the report pack:

Based on modelling provided by London Councils, the impact of the proposed formula changes would result in a reduction of £9.2m (11%) in grant income for Sutton in 2025/26 (without transitional arrangements). Further reductions in funding are likely in the following two years. This will be partly mitigated by transitional arrangements but it is expected that Sutton's overall funding level will reduce year on year over the medium term. This will place significant additional pressure on the Council's budget over the Medium Term Financial Plan and will undoubtedly impact front line services in future.

The committee will also be updated on other key government consultations, including the Local Government Outcomes Framework, Public Procurement: Growing British industry, jobs and skills, Modernising and improving the administration of Council Tax, and consultations related to housing.

The capital programme shows a forecast underspend in 2025/26 of £38.9m, largely a result of programme slippage. The General Fund has an in-year underspend of £20.4m, primarily due to re-profiling of the Belmont railway works for the London Cancer Hub⁵ and the Sutton College project. The HRA programme reports an underspend of £18.5m, predominantly caused by a £13.4m slippage in the Elm Grove Estate Regeneration programme.

The committee will be asked to approve the amendment to the planned funding of the new Sutton College capital budget, and to approve the land acquisition for the Westmead Road housing development project at the purchase price based on the land valuation set out in the Exempt Appendix C. They will also be asked to approve the new capital budget for the Westmead Road housing development project approved by the Housing, Economy and Business Committee.

Finally, the committee will note the Local Government and Social Care Ombudsman⁶ (LGSCO) decisions and actions taken as a result in the period April 2025 to July 2025.

Strategy and Resources Committee - Update on Performance Indicators

The committee will receive an update on the performance indicators of those service areas for which the Strategy and Resources Committee is directly responsible. The indicators monitored by the committee cover the following services: community safety, customer services/experience, public health, asset management planning and capital delivery, finance, ICT, and HR.

The report pack highlights a number of key areas of performance. Averaged over 24/25, call centre wait times were slightly above the 5 minute target, at 5:06 average wait. There has been an increase in the number of complaints logged over the last year, particularly in terms of Stage 1 complaints. The statutory NHS Health Checks programme commissioned by the council ended the 2024/25 financial year on target. As at the end of 2024/25, there was a decrease year-on-year in hate crime offences in Sutton. Debt greater than one year old made up 55.59% of all sundry debt outstanding at the end of 2024/25 (March 2025), rising to 58.09% in quarter one of 2025/26, above the target of 48%. The number of priority audit actions not implemented by the agreed date rose from two at the end of 2024/25 to nine at the end of quarter one 2025/26.

Integrated Sexual Health Service Commissioning

The committee will receive a report on the Integrated Sexual Health Service Commissioning Strategy and recommendation for a collaborative multi-borough approach.

Local authorities have a statutory responsibility to commission and provide open access to sexual and reproductive health services in their boroughs as per the Health and Social Care Act 2012. For Sutton, these services are currently delivered by Epsom and St Helier University Hospital NHS Trust.

The report pack states that the sustainability and viability of traditional hospital-based sexual health services face ongoing challenges due to the shift towards the use of online services, and that to ensure face to face services are available for those that require them, Sutton Council proposes joint commissioning of the ISH face to face service with the London boroughs of Richmond, Merton, and Wandsworth.

The committee will be asked to authorise a 6-month extension to the existing Integrated Sexual Health Contract with Epsom & St Helier Hospital NHS Trust from 1 April 2026 to 30 September 2026, and to authorise the joint procurement of the contract for the Integrated Sexual Health Service in partnership with the London Boroughs of Richmond, Wandsworth and Merton. They will also be asked to authorise the procurement of the contract for the Integrated Sexual Health Service for the London Borough of Sutton alone, in the event that final agreement on a joint commissioning approach is not reached, and to delegate authority to the Strategic Director of Public Health and Wellbeing in consultation with the Chair of Strategy and Resources Committee to enter into a contract in the terms outlined above in the event of a successful procurement exercise.

Annual Report - Investment Property Portfolio

The committee will receive a report to update them on the performance of the Investment Property Portfolio (IPP) over the 2024/25 financial year.

The report pack states that property investments over £80m had been made by the end of the 2019/20 financial year, generating over £5m in additional net revenue to support provision of council services. At 31/3/2025 the total reserve fund was £4.534m.

During March 2024, the council completed the sale of Oxfam House, Oxford Business Park, for £37.1m.

The report pack indicates that net income growth at a positive value of 2.57% indicates the contribution being made by the portfolio to the council's revenue budget and to service delivery, and that the total return of 1.87% reflects localised market conditions, the nature of the portfolio itself relative to national comparators and the impact of modest changes in capital values over the period.

The committee will be asked to note the performance of the Investment Property Portfolio in the 2024/25 financial year.

Facilities Management Hard Services Contract Manager

The committee will receive a report to advise them on the procurement process to seek a partner to deliver the FM Hard Services contract from April 2026, and seek to delegate the authority to the Strategic Director for Resources to appoint a provider following procurement.

The current contract with Mitie Technical Services commenced on 1 April 2022 and is due to end on 31 March 2026. The contract is managed by the in-house Facilities Management (FM) team that has responsibility for all of the council's operational assets. The current contract value is in the region of £820k per annum.

The committee will be asked to agree to procure a new Facilities Management Hard Services contract for the operational estates buildings, and to delegate the award of the contract to the Strategic Director of Resources following the procurement exercise outlined in the report.