New leader calls for unity to deal with £35 million black hole at the council

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A call for unity was made at last week’s Midlothian Council meeting as councillors get down to the pressing task of addressing an estimated £35 million black hole in the local authority’s finances by 2021.

A series of savings options aimed at addressing Midlothian Council’s budget gap in 2018/19 and subsequent years are currently being developed by the council’s chief officers.

In the latest update on the council’s financial strategy councillors heard that the predicted budget shortfall in 2018/19 equates to six per cent of the net cost of services and this could rise to 19 per cent by 2021/22. In that time the grant from the Scottish Government is expected to drop from £145.7m in 2018/19 to £135.2m in 2021/22, with the cost of providing council services rising over that period from £204.2m to £225.9m as the population rises in what is the fasted growing local authority area in Scotland.

Officers’ Transformation Programme savings and a council tax increase each year by the three per cent allowed by the Scottish Government would bring down the predicted shortfall in the coming years from £13m in 2018/19 down to £9m, and from £43.1m to £34.8m in 2021/22.

Speaking at last week’s full council meeting, Midlothian Council leader Derek Milligan (Lab) promised to fight the issue, saying: “If this doesn’t bring home the challenges to the 18 elected members nothing ever will. We are looking at an absolute horrendous position this council has been left in. This is a reality check.

“I simply don’t accept that we sit back and take these budget cuts, in an area that has been identified as the fastest growing location in Scotland. If we are being asked to take that challenge by the Scottish Government, and it’s not something we have asked for, it’s what we have been asked to take, if they want us take this great growth then the funding has to come along with this.

“They can’t lump this on to the responsibly of the council.

“This is your time to nail your colours to the mast for the people of Midlothian and put your politics behind you.”

Cllr Milligan listed elements of the council budget that were protected and therefore could not be cut, including teacher numbers, contractual arrangements and loan charges. He added: “Elements of the budget that are protected and are going to be very hard to get savings from equates to £112m today rising to a £140m by 20/21, that therefore leaves us to find the savings from the money that is left.”

Referring to predicted pay inflation at one per cent increasing council staff wages, he warned: “The reality is that council tax rises are not going to keep up with that. This is going to get worse and worse. These things are outwith our control.

“In some areas of this council we are going to have cut the budgets by 50 per cent. Right across the piece we are talking about frontline services and when you simply cut a service in half it doesn’t always mean you get a 50 per cent saving”

Cllr Parry (SNP) said: “We are standing in line with the NHS and all other organisations. We are all begging for the same pot.

“We need Teresa May to get out her magic money tree, if she can do it for the DUP and Northern Ireland she can do it for Midlothian as well.

“I don’t disagree with asking for more money, I think you need to put into context what you are asking for and where are your asking it from.”

Cllr Milligan will be calling on all Midlothian MPs and MSPs to oppose any future cuts to local authority funding for Midlothian Council. He will also meet with the finance minister to seek additional and exceptional support given the expected population increase across the county.

The work currently underway to identify further savings will take the form of a comprehensive change programme, to be presented to the council this September. Councillors will then make their final budget decisions for next year in the early part of 2018.

The Business Transformation Steering Group, which challenges and scrutinises the development and delivery of the Transformation Programme to ensure its outcomes support the aspirations of the council, has had its remit extended to encompass all of the change programme activity and related projects aimed at addressing the budget gap.

Cllr Kelly Parry (SNP) raised fears that this would turn the group into a “cuts committee” and argued that the group’s remit should stay as it was.

However councillor Jim Muirhead (Lab)responded: “Unless some miracle from Westminster or Holyrood boosts our financial position we are going to have to save £35 million out of a £200m odd budget in the next five years. How can we do that without transforming the way we work? This committee has to look at that.”

Cllr Milligan labelled Cllr Parry’s comments “childish”, adding: “I’m quite happy to see the scope widened while we look to balance the budget and transform this council.”

The changes were approved by 12 votes to five.