Balancing on a financial tightrope

We live in a really special place. I know my opinion is clouded by the fact I was born and brought up in South Uist but that doesn’t make it any less true.

I’m in the fortunate position of representing our community as one of the Councillors for the South Uist, Eriskay and Benbecula Ward and also as Leader of Comhairle nan Eilean Siar.

One of the perks of the job is that I’m privileged to receive information and reports about what’s happening at local, regional and national levels on a daily basis and if anything, that information and my experiences in the job have backed up my opinion.

Of course there are difficulties and issues that need to be resolved but everyone who has put themselves forward to represent their area knows that, and tries their best to resolve the issues and overcome the problems.

The situation that has taken up most of our time at the Comhairle recently has been the small matter of setting our budget for the year 2024/25. We have a legal duty to present and agree a balanced budget and despite late interventions from Government, I’m happy to say that we managed to do just that in February.

What I’m less happy to say is that we had to use up £2m, around half, of our unallocated reserves and make £1.7m of service changes and reductions to do that. Plainly speaking, that means reductions in some of our services and no room for growth.

We also had to put an indicative freeze on filling some long term empty posts to meet a savings target of £300k and rather than using interest received on a loan to the Stornoway Port Authority and the income from increasing Council Tax on second homes to improve some service areas, those revenue sources had to be used to “fill the gap” and stop any further cuts.

I’m sure many of you will have noticed that service levels aren’t what they used to be but the unfortunate reality is that because we have less resources (people and funding) we aren’t always able to provide the levels of service that we’d like to provide. It hasn’t helped that inflation means our finances don’t go as far as they did.

That is the same across much of the public sector. Scottish Government themselves and most other public bodies in Scotland are now having to deal with trying to find savings and efficiencies in order to run their services. For Local Authorities that has been our reality for a number of years now, certainly since I joined the Comhairle seven years ago.

This year we expected a flat cash settlement from the Government but actually received an increase of £2.3m, however once pay deal commitments and other Government priorities were accounted for, it actually meant a £1.5m drop to our General Revenue Grant (GRG), which is the main source of Local Authority funding.

The other source of funding is Council Tax but, as I’m sure you’re aware, we were funded by the Government to freeze it this year. The general view across Scottish Local Authorities is that the funding to do that should have been awarded to Councils in our GRG and we should have been allowed to set the Council Tax at a level that supports the services we need to provide. I’ll not labour the point but apart from the financial side of things, the principle of the Council Tax is that it is a “Council”Tax and it should be up to Councils to decide on it.

I need to commend my fellow Council Members for the decisions they have made, the process of identifying and agreeing the savings was not easy and, as I said during the meetings, the Budget we agreed on wasn’t one any of us would wish to see presented. We went line by line into the detail of budgets across all Departments and it highlighted how little room there is for manoeuvre without looking at compulsory redundancies. Thankfully, we’re not in that position and we were also able to protect the Additional Support Needs (ASN) budget as well as the Inter Island Air service as they were highlighted as council priorities.

This year’s budget setting has been further complicated by late and conflicting messaging from the Scottish Government and we may not actually be able to make some of the savings we’ve already agreed, for example on teacher numbers, putting pressure to find those savings elsewhere during the year.

I really need to commend the staff at the Council, it was one of the most difficult budgets to set in the context of reduced resources and increased costs but when you throw a Cyber Attack into the mix, it really can’t be overstated how extraordinary it was that IT, Finance, Democratic Services and all the other teams at the Council supported the Members to allow us to set the budget.

They are certainly the unsung heroes, but like most heroes their work is never done. The work for next year’s budget will start very soon and it’s not going to be easy. Nobody said it would be but there’s a desire there from Members and Officers to approach it head on. A willingness to be innovative and to protect and improve front line services to the public because at the end of the day, that’s what the Council is there to do.
I believe I mentioned in a previous column that us Islanders are often heard but not necessarily listened to but sometimes the message gets through and it gives you hope that things are changing.

Although we’re still working through the detail it looks like some of our budget lobbying has been effective and meetings with the Deputy First Minister and the Minister for Local Government has led to the announcement of further funding for Councils in general and specifically Island Councils. Too late in terms of the Budget we’ve just set but perhaps enough to allow us to soften any blows during the year and, dare I say it, actually invest in services.

Further proof that we’re being listened to is the £20 million we were awarded as part of the UK Government’s Levelling Up Partnership. I hosted the UK Islands Forum on behalf of the Comhairle late last year and having extolled the virtues of what us Islanders can do if we’re given the resources to take things forward we were very pleased to hear Mr Gove and his colleagues’ announcement. We now have to ensure we spend it wisely.

When I started this piece I wanted to tell you a bit about what I’ve been up to and offer some thoughts on what can be done to improve our situation and there is no shortage of material. As you can see the Budget alone took up most of the space! Single Island Authority, Crown Estate Funding, Special Islands Need Allowance, Area Forums, The Islands Deal, the King’s Awards for the Daliburgh SHARE Thrift Shop, the Comhairle committee series taking place in Uist and Barra in April and all the rest will have to wait for another day.

So I’ll finish with this and reiterate that I think we live in a really special place but to allow it to thrive we need to focus activity around three areas; 1-You need to be able to get here (and away, reliably, regularly and affordably) 2-You need to be able to live here (in accommodation that meets your needs at a price that’s affordable) 3-You need to be able to work here (in well paid jobs in a varied economy)
If we can get those three things right then the rest will follow.