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The truths they don't want you to read....

Wednesday, March 23, 2011

Local Government settlements

Lucky old Argyll & Bute who have received an extra £3.9m in Government funding following a 'review'.

They complained about the severity of the settlement, and lo and behold the agreed formula was found to be 'wrong'.

Anyone got any idea how much lobbying the Comhairle undertook on this matter?

As I was explaining to a Councillor not that long ago, looking at page 8 of the settlement documents for 2001/12 gives a frightening forecast of where the islands could be going.  I think a simple explanation of what this all means is timely, given the looming election.

The Government grant is computed using a series of formulae about population size, schools, pensioners, sparsity and super-sparsity of the Council area and a thousand other factors.

On that basis, the Comhairle would have received £87.56m or 18.53% less than we currently get.  Yes, you read that right, all other things being equal, we should be facing nearly a 20% drop in Government grant.

The Government then decides what the maximum decease is going to be, in this case 4.5% and the floor mechanism redistributes money for better to worse-off Councils, meaning that we are given £15.084m by other Councils to soften the blow.

Now follow the logic of this through: because we are so far off the bottom of the scale, I can see no possible way in which we will ever stop suffering the deepest cuts in future budget settlements.

This is a challenge for whoever is in power after May, and a challenge for the Comhairle, as the only way to alter the financial settlements will be to alter the formulae, and that is not easy.  The computations are very complex, and difficult to understand, far less argue against; and the need to establish the 'under-performing' sections of the formula is a key element of having a successful case.

There are lots of minor areas you could argue, but the issue has got to be identifying the major changes needed, and those that will make a significant difference to the impact of the floor.  Whilst I am available for a long-term consultancy exercise on this matter, Councillors will need to seriously address this issue internally to establish a basis for the next Council to try to take this forward.

It's that, or face £15m in additional cuts; a figure that is likely to increase in a vicious circle of decline, if something is not done.  It is not hugely complex to understand where this will take us, and it should be a matter for the Council to seek pledges of action from the political parties at the coming election.


Anonymous said...

I find it hard to believe that anyone who has any concept of Scotland's geography can think one 'formula' will fit all local authorities.

Anonymous said...

I see the Cooncil have ballsed up again down at Grampian studios. After originally planning block paving for car parking spaces and fines for the road, they've now decided to block pave the whole lot. Cue a few thousand more blocks. Mind you, the money that's being wasted in that area is scandalous anyway.