Cheshire East is forecasting an overspend of £8.86 million in children's services this financial year because of soaring placement costs and because it set 'unrealistic savings' in the budget.

Finance officer Diane Green told yesterday's (Monday) meeting of the children and families committee: "Although numbers of children in care are reducing, the cost of placements in 2025/26 has continued to increase, creating an unbudgeted pressure."

She also said that savings factored into the budget for this financial year (2025/26), such as safe walking route to school schemes, are not fully deliverable due to a link to capital projects.

Cllr Jos Saunders (Poynton, Con) said the savings in relation to walking routes had failed to materialise over a number of years, as had proposed savings relating to accommodation for 18 to-25-year-old care leavers.

She said it begged the question: "Why do we keep putting in unrealistic savings?"

Dawn Godfrey, who took over as executive director of children's services in April, said: "I think some of the numbers that were put in initially in the MTFS (medium term financial strategy) did not have fully worked-up business cases that demonstrated exactly how children's services would be able to make those savings in the context of being an inadequate children's services within Cheshire East.

"You cannot just take out swathes of savings without understanding the investment also required in order to improve children's services."

She told councillors: "What we've been doing in children's services over the last three or four months is really going through in detail what the savings profiles are in children's and completely re-engineering our transformation and improvement plan for children's services."

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Mrs Godfrey said a big chunk of the overspend had been because the accommodation costs for 16 to 25-year-olds had shot up by 54 per cent this year.

"There's no growth in the budget that would address 54 per cent because you wouldn't necessarily expect that, but it's a direct consequence of an inadequate grading by Ofsted, particularly on our care leavers," said Mrs Godfrey.

She said finding safe and suitable accommodation for those who were previously living in unsuitable places comes at a cost because the council was spot purchasing.

She said the block purchasing, recently agreed at committee, would deliver savings in the future 'but not at the moment because we don't have it now'.

Cllr Saunders said the committee needed to start having realistic budgets and she thanked the new children's boss for being 'so candid'.

"We now have some realism," she said.

"Although the picture looks awful, I would rather have the truth put in front of me so that we can all work together to resolve it, than have unrealistic savings."

Conservative group leader Stewart Gardiner said there were outside factors but 'at the end of the day, part of the reason why the spotlight is on this committee is the fact that a budget set was not sustainable and, for whatever reason that happened, I think we have to make sure that doesn't happen moving forward'.

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Committee chair Laura Crane (Sandbach, Lab) said the council had a legal and moral duty to look after and protect children.

She said the committee had to make sure the projects put forward by the new children's boss were worked through and delivered in the coming years 'to ensure that we're in a better place to not overspend in the future'.