Councils must speed up reform to save services - watchdog

A council lorry clearing drains in East Ayrshire

Scotland's councils have been warned they must speed up the pace of reform if they are to protect services in the face of "unprecedented" spending pressures.

Financial watchdog the Accounts Commission said some progress had been made, such as putting some services online, but much more needed to be done.

The commission has previously predicted a funding gap of £585m next year, rising to £780m by 2026-27.

The Scottish government said it had made record funding available to councils and was working on a new agreement to empower local government.

The report acknowledged that councils had been changing they way they deliver services for years but said that would need to be accelerated.

Accounts Commission member Jennifer Henderson said: "Councils must now move with an ambition and pace we've not yet seen if they're going to successfully address the financial sustainability, workforce and service challenges."

The report did not give specific examples of the changes councils could make, but it outlined some general principles.

These included a focus on large-scale recurring savings or income generation measures and more emphasis on preventative work to reduce demand for services.

"Collaborating with others, both within and outwith local government, will be a key part of the solution," Ms Henderson added.

Learning from good practice was also encouraged - with Dundee singled out for achieving £147m of savings since the financial crisis of 2008.

Last year the Verity House Agreement promised to reset relations between central and local government - but the report said this had been "challenged" by actions such as the unexpected announcement of a council tax freeze last October.

Finance Secretary Shona Robison and Humza Yousaf, after his surprise announcement of another council tax freeze at the 2023 SNP conference

Responding to the report, Finance Secretary Shona Robison agreed that transformation was needed to deliver priorities such as maintaining services, tackling child poverty, growing the economy and delivering net zero.

“Despite the decision of the previous UK government leaving the country in a challenging financial situation, the Scottish government has made available record funding of over £14bn to local councils this year – a real-terms increase of 2.5% compared with the previous year," she said.

"We will also continue to work with [local government body] Cosla to empower councils through a new fiscal framework.”

'Underfunding'

Opposition parties said the Scottish government was to blame for the pressures on councils because of years of underfunding.

Scottish Conservative finance spokeswoman Liz Smith said: "Change will be essential to provide the basic services people rely on, but that will only be possible if the SNP government finally starts to deliver support and funding."

Mark Griffin, Scottish Labour's local government spokesperson, said: "For years the SNP has hollowed out council budgets and lifeline services across the country have been cut to the bone as a result.

"We need real leadership from the Scottish government to help councils deliver the reforms needed to make sure local services are fit for the future."

For the Scottish Liberal Democrats, Willie Rennie said the council tax freeze had been announced by the SNP "on a whim".

"The SNP have taken deliberate decisions to starve Scotland's councils, sometimes as a budget gambit, sometimes as a stunt and sometimes because their own bad decisions have left them short of funds," he said.