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Council adopts new five-year financial plan

Lerwick Town Hall. Photo: Shetland News

COUNCILLORS have approved a financial plan for the next five years which suggests savings of £15.6 million will have to be found.

A proposal by central mainland councillor Ian Scott at the full council meeting on Wednesday to throw out the plan on the basis of its efficiencies did not receive any support.

The medium term financial plan warns that the cost of services will rise faster than the council’s income, with this mainly due to an expected continued decrease in core funding from the Scottish Government.

Finance manager Jonathan Belford presented councillors with a report detailing three possible outlooks for the next five years – best case and worst case scenarios, and a ‘medium’ forecast.

The latter formed the basis for the financial plan, which included an assumption that the council would receive £8 million from the Scottish Government for running its inter-island ferries – an increase on the £5 million it pocketed for 2018/19.

The meeting opened with a round of applause for Belford, who was appearing at his final full council meeting before moving to a new job in Aberdeen.

“As you leave us for your new challenge, you take with you our very, very best wishes,” convenor Malcolm Bell said.

Councillor Scott, however, was not too impressed with the amount of efficiencies that will need to be found, expressing concern for social services in particular.

Stating that he would not “sit here and nod” along to the plan, presented while the council has over £330 million of investments in its reserves, he proposed that the plan be rejected in its entirety – a motion which fell on deaf ears.

South mainland councillor George Smith said Scott’s argument on spending was for another day, although he had some sympathy for his views.

He added that his “dilemma” when it came to the financial plan related to the “huge challenge” which could present itself if the council merely accepts that the Scottish Government will reduce its core funding.

Smith warned that overplaying the “self-fullfilling prophecy of doom” over decreasing funding might actually make it easier for the government to continue down this path, with the council needing to “redouble its efforts politically” and lobby ministers more strongly.

Lerwick South member Peter Campbell said that the financial plan was not a “strait jacket”, and rather an indicator, suggesting that the real work will come in February when next year’s budget will be set.

Council leader Steven Coutts said that achieving the full whack of fair-funding for ferries is a vital component of the local authority’s financial planning.

“There’s no other option and we cannot accept anything less than that,” he said.

Coutts added that “we must ensure that we are using every opportunity to maximise the income that we have year on year”.

He moved the recommendation to adopt the financial plan, which was seconded by Allison Duncan, with the matter not going to a vote as Scott did not receive any backing for his motion.

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