Analysis: a year of balancing power and budgets

The word ‘funding’ is never far from the lips in any discussion of local government and it remains a grave concern for the foreseeable future unless significant changes are made.

A report by the Accounts Commission in April found that councils in Scotland have balanced real-terms funding cuts of 9.6 per cent over the last eight years, while at the same time experiencing increasing demand.                                                                                                                          

The commission suggested that without service redesign or policy changes, councils could be spending nearly 80 per cent of their budgets on education and social  work by 2025/26.

COSLA responded by saying that local government cannot continue to be the “poor relation” of the public sector and called for “adequate and fair funding” for local government services.

A small victory was won in the ongoing battle between local and central government over funding, though, when the Greens negotiated an extra £170m for councils as part of the deal for giving their support to the budget.

However, the budget also saw a lifting of the cap on public sector pay, with all employees who earn up to £30,000 receiving a minimum three per cent pay increase, while those earning above £30,000 get two per cent, with a cap of £1,600 for those on £80,000 or more. And teaching unions are bidding for more, claiming a 10 per cent rise is needed to restore salaries to the equivalent of their previous levels.

Concerns have been raised, too, about both the costs and the capacity to deliver the Scottish Government’s promise of 30 hours per week of free childcare for all three and four-year-olds as well as eligible two-year-olds. The Accounts Commission has said there are “significant risks” that councils will not be able to expand funded childcare to 1,140 hours a year by 2020.

Meanwhile, councils have been seeking innovative solutions to help with their budget problems. COSLA recently launched a campaign for more financial powers for councils, starting with a ‘transient visitor tax’ or tourist tax. COSLA president Alison Evison said councils were looking for “powers to raise money in creative ways in local areas” and it was “all about local democracy and local choice”.

COSLA revenue spokesperson Gail Macgregor suggested that Finance Secretary Derek Mackay had become “more open minded” about a tourist tax, but City of Edinburgh Council leader Adam McVey provoked the ire of SNP party colleague Culture Secretary Fiona Hyslop when he announced that Edinburgh was planning to introduce a tourist tax as early as 2019, even though the Scottish Government has yet to approve any transfer of power to enable it to do so.

City of Edinburgh Council has also begun looking into introducing a ‘workplace levy’ on parking space at offices in a move that could raise revenue as well as help to tackle air pollution and congestion.

Specific areas of Scotland have had a boost this year, with the Islands Act giving island councils more powers over coastline planning and licensing, while a city deal for Stirling and Clackmannanshire will bring an extra £95m of funding to the region to be invested in infrastructure and the economy. And plans to create a Borderlands growth deal for the south of Scotland and the north of England were announced by the Chancellor, Philip Hammond, in the budget in November.

by Mark McLaughlin

Society & Welfare

Analysis: The last year has seen Derek Mackay become part Robin Hood reformer, part austere King John

Also within local government sights are more powers to regulate short-term lets, with concerns raised about the increase in letting through companies such as Airbnb taking property out of the residential market. This is something that the Greens are proposing should be tackled in an amendment to the Scottish Government’s planning bill, which completed stage one in May.

The bill, which is intended to reform and simplify the planning system and give communities more of a say over decisions, has come in for criticism, though.

Built Environment Forum Scotland (BEFS), which represents 23 organisations in the sector, expressed disappointment that “the scope of the review has shifted from major reform to a series of procedural changes”, while the parliament’s Local Government and Communities Committee called for more to be done to ensure that communities, in particular deprived communities, are supported to help shape their area and opposition parties suggested the bill would lead to a centralising of planning powers.

Meanwhile, homelessness and other issues related to poverty continue to cause concern. The Scottish Government launched a homelessness action group in September, chaired by Crisis chief executive Jon Sparkes, along with a £50m ‘Ending Homelessness Together’ fund, with the aim of ending rough sleeping.

Housing Minister Kevin Stewart said: “We are committed to eradicating rough sleeping in Scotland and know this requires more than just the provision of housing – every individual has their own unique needs and challenges. To achieve this, we need to ensure we have a joined-up approach across all sectors to improve prevention.”

However, homelessness rose by one per cent last year, reversing a nine-year trend of decline and the latest figures show the number of children living in temporary accommodation in Scotland has risen for the fourth year in a row, with 557 more children living in temporary housing in 2017-18 than the previous year – an increase of nine per cent in a year and 59 per cent higher than in 2014.

There was also an increase in the number of applications for crisis grants, and foodbank charity the Trussell Trust reported a 20 per cent increase in foodbank use last year. At the same time, several councils launched free meals for children during the school holidays, aware that many are going hungry.

The rise in both poverty and homelessness has been linked to the rollout of Universal Credit and delays to payments, but with poverty such a key indicator of both educational achievement and health, this is a policy area that must be addressed if the country is to succeed in other ways.

Following the unanimous passing of the Child Poverty Act in November, the Scottish Government now has a statutory duty to reduce child poverty by 2030. The act sets out legal targets for the reduction in levels of child poverty, along with mandatory reporting on progress and specific actions for councils as well as the government. But it will be challenging, as figures suggest that the number of children living in poverty in Scotland is expected to rise to 360,000, or 38 per cent, by the mid-2020s.

With a new cabinet secretary role for social security created in Nicola Sturgeon’s June reshuffle, and responsibility for equalities and older people assigned to a new ministerial role under that, Aileen Campbell’s cabinet secretary remit is narrower than that of her predecessor,  Angela Constance, but given it encompasses so many challenges, undoubtedly she will have enough to be getting on with.