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Highland Council could lose 400 staff and blames ‘untrustworthy’ Scottish Government

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Highland Council could shed as many as 400 staff as it tries to balance its books amid a budget crisis.

As hundreds of staff line up for voluntary redundancy, the council leader last night blamed an “untrustworthy” Scottish Government for its financial plight.

The authority criticised the delay in announcing the level of grant, a misleading indication of the extent of the cut and its powerlessness to make decisions due to the shadow of multimillion-pound penalties if it dared break the SNP’s council tax freeze.

Highland councillors will ratify a 2016-17 budget a week today.

Publishing a draft document last night, council leader Margaret Davidson said she was “shocked and disappointed” by the Scottish Government’s handling of the latest settlement.

She was speaking at a media briefing at council HQ, where more than half the staff have asked to be considered for voluntary redundancy.

Margaret Davidson
Margaret Davidson

“Up to the last year or so, we had a fairly good relationship with the Scottish Government,” she said.

“I think that is now severely damaged and it’s going to be difficult to rebuild the respect and trust that was there before. That’s not good for the nation.”

The council confirmed that it had so far accepted voluntary redundancy approaches by the equivalent of 275 staff but that the figure could well rise to 400 once the process is complete.

It has still declined to rule out compulsory job cuts as it tries to make ends meet.

Almost 10% of the authority’s revenue operations will be reduced in 2016-17.

Finance director Derek Yule said that of £30million of savings requiring approval, more than £23million was “directly attributable to a cut in Scottish Government grant, a cut of over 4%”.

Highland finance director Derek Yule.
Highland finance director Derek Yule.

Councillor Davidson said that figure was “despite anything the Scottish Government says to the contrary”.

She blamed the governments on both sides of the border but vented huge frustration about the sense of a recent loss of local control of council finances.

She said: “Constituents told us to increase council tax to protect services but we can’t because the powers have been taken away from us.

“We’re powerless because the Scottish Government announced that the sanctions that would be put on us wouldn’t just be the 3% we were prepared for.”

Highland Council would have been penalised to the tune of £18million if it had broken the tax accord.

Mrs Davidson said: “It’s been a huge challenge but I believe we’ve got as decent a budget as we can possibly have in the situation.”

She praised “extraordinarily decent” staff and unions who, she added, understood the problems facing the administration.

“Over the next year, we’re going to have to restructure the council because by the time the dust settles we’re going to have to move staff around,” she said.

“We’re going to have to resize teams and we need to take care of our staff. We need to be acutely aware of the impact on them in working for smaller teams.”

The council will dip into a £35million emergency “reserves” fund to pay for the voluntary redundancies.

They will cost about £12.5million.

Mr Yule said the fund would be replenished over the next few years but not to the existing level, which was deemed extravagant.

The minority Independent administration was keen to highlight that it had kept a pledge to increase spending on roads with a £25million-plus, three-year, programme.

It also insisted it had protected the winter maintenance budget for roads.

Highland Council envisages further budget reductions of £21million in 2017-18 and £15million the following year.

 

Eden Court Theatre
Eden Court Theatre

Where the axe is expected to fall

The care and learning department is set to take the biggest hit – £8.4million – in Highland Council’s proposed spending cuts.

It would mean grants being slashed for a range of beneficiaries including care homes, women’s aid charities, Blindcraft, Inverness Leisure and Eden Court Theatre.

It would also impact school catering, cleaning and music provision.

Elsewhere, the draft budget has identified the following savings:

Finance department – £2.5million. Community services – £2.4million. Development and infrastructure – £2million. Corporate development – £970,000. Chief executive’s office – £900,000.

Opening hours at recycling centres could be reduced. The council’s subsidy to VisitScotland could be slashed and its countryside ranger service could be almost halved.

There have been 801 applications for voluntary redundancy, of which 275 are “full-time equivalent” jobs.

Redundancies are likely to cost the council’s reserves fund £12.5million and reap an annual saving of £10.5million.

Highland Council is preparing to pay off 37 senior managers, to save £2.4million. It had already shed 46 senior jobs in the past eight years, saving £3.6million in its wages bill.

A ninth year of council tax freeze will hold Band D bills at £1,163.

 

What the Scottish Government had to say

Responding to the damning criticism from Highland Council chiefs, a Scottish Government spokesman said: “Our offer has been accepted by all 32 local authorities, who have secured their share of a £10.3billion funding package.

“Householders, workers, healthcare and schools will all benefit from the deal, which allows the opportunity to transform the provision of social care in Scotland with a £250million investment in integrating health and social care services.

“We recognise the pressures on budgets across the whole of the public sector and in households throughout Scotland, which is why it is important to maintain the council tax freeze – which has saved the average Band D household around £1,500 in total – while we consider ways to replace it as well as reimbursing local authorities to ensure they can continue to provide essential services.”

Highland Council’s opposition SNP group will put a list of alternative budget proposals to next week’s council meeting.

Group leader Maxine Smith said: “We’ve managed, through negotiation with the independents, to have some of the worst savings removed – ones that would have dramatically affected the most vulnerable in society, such as the community wardens and antisocial behaviour team.

“In scrutinising what is included, there are around £1million of savings that the SNP group are not prepared to accept. We will, therefore, propose competent alternatives to these on the day.

“In looking for other options, we have not targeted procise savings or individual posts, but have concentrated on where the council can be more efficient and productive, thus causing no hardship to people or reductions in services.”