Councils need 'radical' change, spending watchdog warns

Radical change is needed from councils if they are to maintain services, the public spending watchdog has said.

The Accounts Commission has warned councils have “gone beyond the point” where making savings can meet financial pressures.

Councils must change or else be forced to make deeper cuts, it said.

It also called on the Scottish Government and Cosla to finalise its New Deal for Local Government to allow for better budgeting.

The report said an increasing proportion of funding handed to local government is ringfenced for national priorities, which puts constraints on council decisions to meet local needs.

It urges councils to work together, with local partners and with communities to provide financially sustainable services while tackling national issues.

Tim McKay, acting chair of the Accounts Commission, said: “The New Deal for Local Government, agreed between the Scottish Government and Cosla, is long overdue.

“Putting this in place will give councils longer-term financial stability, supporting them to make decisions and make the fundamental changes that are urgently needed.”

Labour has said councils are now at “breaking point” with lifeline services “under threat”.

Local government spokesperson Mark Griffin said: “The SNP-Green government need to stop robbing funding from communities and work with councils to deliver a sustainable future for services.”

Scottish Lib Dem MSP Willie Rennie urged the council to scrap its plans for a National Care Service and give councils support they are seeking.

He added: “Local government sits right at the bottom of the list for the SNP-Green Government, and those who bear the brunt are the ones already struggling to make ends meet.”

Local government minister Joe FitzPatrick said: "We recognise that the work of both local and national government is vital in delivering sustainable public services our communities rely upon.

"That is why the Scottish Government is committed to working with Cosla to agree a New Deal for local government that promotes empowerment and provides greater flexibility over local funding with clear accountability for delivery of shared priorities and outcomes."

Cosla said the report reflected the "increasingly difficult choices" being made by councils in light of reduced budgets and growing demand.

Cosla president Shona Morrison added: “Today’s report from the Accounts Commission and [Cosla's] response to the Finance and Public Administration Committee deliver exactly the same message. Councils are uniquely placed to be the key partner in the Scottish Government's public service reform programme and should be further empowered to better support local service delivery.”