Northamptonshire County Council has misspent £8m of public health money and has now been ordered to find the funds to re-invest in services.
After months of talks a deal has been struck between the local authority and Public Health England (PHE) over the council’s misspending of its public health grant.
The council received a £35m grant from PHE in 2017-18 and a similar sum in 2016-17.
The grant was given to provide services with public health outcomes but instead several millions were incorrectly spent on adult social care and children’s services.
This is a further blow for the county authority which is in the midst of a severe financial crisis and currently being overseen by two Government-appointed commissioners.
A Northamptonshire County Council spokesman said: “Following extensive discussions with Public Health England (PHE), we have reached an agreement regarding £8.038m of public health grant funding historically spent on public services, including adult social care and children’s services, that did not comply with grant conditions. We are currently confirming arrangements with PHE as to how NCC will reinvest this money in public health services for the benefit of the people of Northamptonshire.”
The £8m may have to be found by making further cuts to other services. The £12m taken from general reserves in April to ensure the authority balanced its books has to be repaid this year and the authority also needs to make a further £35m of savings. Just last week the council’s top finance officer Mark McLaughlin told the council’s audit committee that ‘there’s not much left to sell because we’ve sold it all.”
Councillors from the ruling Conservative Party have warned residents that further difficult decisions are coming.
The exact figure of what was misspent has been unclear for many months. In its 2018-19 draft accounts the county council said that £3m from 2017-18 and up to £7.3m from previous years was in dispute. However, the council’s auditor KPMG announced in its May external audit report that the figure could be £16m.
Leader of the Labour opposition Cllr Bob Scott said councillors had been kept in the dark about the situation.
He said: “The figure of £8m is half the figure that it could have been. Former chief executive Damon Lawrenson initially told councillors on the finance scrutiny committee that the amount liable was £250,000 and then it kept rising to £5m and then more. I am glad that the funds do not have to be repaid to Public Health England as could have been the case and that they will rather be spent on Northamptonshire residents.”
Public Health England has declined to provide any further details.