Thank you, convener, and thank you for having us back in front of your committee. We welcome the invitation to discuss the evidence submitted jointly by COSLA, SOLACE and directors of finance. Our evidence presents a consolidated local government view of the Scottish Government’s budget as it stands and of the detrimental impact that we believe that it will have across our communities.
Since we came to the Local Government and Communities Committee in September last year, the context in which we are operating has remained unchanged, as have the expectations of our citizens and the fact that demands on councils are growing. We have on-going pressure on core budgets, not only to deliver new policy priorities but to transform and develop our digital services. We also have challenges in relation to the fundamental structure of our budget. Although formal ring fencing in the legal sense accounts for around 8 per cent of the budget, just over 60 per cent of councils’ budgets is directed by Scottish Government policies. That puts huge pressure on the core that is left, which is the area that can make the most significant difference to the look and feel of communities and to the wellbeing of individuals.
The core is what helps us to undertake innovative, preventative work, and we wrote to the committee after the last session with examples of that work across all councils. Those challenges were also clearly articulated last September and formed the basis of this year’s spending review lobbying document, “Invest in Essential Services”, which we launched in January.
Our financial asks have been well documented, especially the £1 billion revenue on top of last year’s base budget of £10.078 billion. However, “Invest in Essential Services” focuses on the benefits of investing in local government to achieve our shared priorities. It asks the Scottish Government to recognise local government as a critical sphere of government and to acknowledge our unique role and reach in every community across Scotland, to the mutual benefit of us all. As it stands, the budget does not do that and it presents risks to our four priorities—inclusive economic growth, tackling child poverty, wellbeing and climate change—and a risk to the fundamental sustainability of communities.
This year, we are concerned about not just revenue funding: the budget sees significant reductions in capital, and the knock-on effects on inclusive economic growth and addressing climate change are currently immeasurable. We need building projects that provide jobs, training and apprenticeships, and we need capital funding that allows us to invest in infrastructure, plant and equipment that address our energy usage and emissions.
In this year’s submission, we have drawn on evidence from the Scottish Parliament information centre, Audit Scotland and the local government benchmarking framework, all of which point to real challenges and the fact that it is getting harder every year. Councils have done well at treading water, but the evidence is now revealing cracks and, whether it is a matter of increasing reliance on reserves or declining public satisfaction rates, those cracks point to a situation that is no longer sustainable and which is of real concern for councils and communities.
We are happy to answer any questions that the committee has today. Thank you.