Challenging times at the City Chambers
2019/20 Budget will be set this month
THE council meets twice in February to set its budget for the next financial year which is a ‘significant challenge’.
The administration estimates it needs to cut £41 million from its revenue budget to balance the books in 2019/20 and around £150m over the next four years. This is in part due to the settlement from The Scottish Government which Depute Leader Cammy Day said was ‘worse than we expected’. Whether or not that settlement is increased when The Scottish Government set their budget on 31 January will be known by the time the council debate their draft budget proposals, but it will not change the financial landscape which is one of less money, a growing city and increasing demand for council services.
At the time of going to press the Scottish Greens announced that unless council funding proposals were improved they would not vote for The Scottish Government budget. Patrick Harvey co-Leader of the party said that over the last two years, constructive pressure from the Scottish Greens has resulted in the government cancelling over £300m of planned cuts to council budgets. The 2019/20 budget contains fresh proposed cuts, with councils across Scotland warning of dire consequences.
Until 11 February you can help the council in the capital decide where to make the savings from their revenue spending in the period to 2022/23.
A consultation is running on the council website based on the plans for change which the council drew up in autumn 2018. They already saw a need for changes in the next four years based on ‘key financial assumptions’. There was a consultation on the outline document in autumn and now a more specific consultation based on the plans altered in light of public comment is open for you to add your views.
THE council is bound to set a balanced budget each year and it does this each February. A draft plan of where cuts will be made to allow the finances to add up has been produced and will be debated by councillors at two meetings in February.
The process began with publication of Planning for Change and Delivering Services 2019-2023 in autumn last year. The public were consulted on its terms from 1 October to 7 December 2018 and 1597 submissions were made in response which is about 20% more than in 2017.
A further consultation runs till 11 February. The public is invited to comment on the high level proposals for change which have now been reviewed to take account of public comment thus far.
So where does the council think they can save money? Check the ready reckoner here on the right for the highlights where necessary savings are proposed, which will cut employee numbers by 300 posts (not people but positions) and allow the council to retain their ambition while 'managing the council better’.
Council Leader Adam McVey told a journalists’ briefing last month that while The Scottish Government has actually increased the amount of money available for local councils overall, a challenge remains.
He explained : “A lot of that is tied to national priorities that we are signed up to. So we are delighted to get the extra money for Early Years for example and Edinburgh Integration Joint
Board (EIJB) to help us look after older people and those needing care, but the overall funding package does carry quite significant challenges for us in terms of our core budget which is why we need to find about £41m of savings.
“We have put together a package of options which are focused predominantly on things like efficiency savings, internal council spend rather than funding service delivery.
“We have tried to find quite innovative ways of using our revenue and capital budgets. Roads are a prime example - people don’t care whether it’s revenue or capital spend, they just want money spent on resurfacing of roads and that potholes are fixed. By moving the money around between capital and revenue we have managed to sustain that investment while taking some of the pressure off our revenue budget. It has been a very long process. We started this more or less after passing the budget last February so this is almost a year of work culminating in the 80 or so proposals that we now have.
“These range from looking at what we spend on mail and printing, some small budgets within our legal services where we can find some savings to drastic savings of £1.5 million for example in spending on the Economic Development. This will affect how we drum up some of the economic business investment that Edinburgh has been so successful at. Some of those decisions are based on what we know. We know that Scottish Enterprise might pick up some of the slack following the decisions that we are taking in this area. We know that reducing the budget for Marketing Edinburgh (ME) for example will lead to other people looking seriously at how the city markets itself.
“In terms of ME it is one of the examples that has always been cited as what we would be doing with a tourist levy of some description - marketing the city and supporting Edinburgh as a destination and sustaining that success. It is always in our minds what that revenue could be used for and the position that we are in now means that unless we get additional funding like
TVL for things that sustain our tourist economy like Marketing Edinburgh we are no longer in a position to sustain those services.”
The council plans to cut Marketing Edinburgh’s budget by £567,000 in 2019/20 and a further £223,000 in the following year. This is a cut of 89%.
John Donnelly Chief Executive of Marketing Edinburgh is furious about the proposal and has written to all councillors pointing out that this cut would mean Scotland’s capital would be ‘the only major city in the developed world without a Destination Marketing management organisation’.
Mr Donnelly criticised the short-sightedness of such a move and wrote : “Without a body that unites public and private sectors in the city’s promotion and economic development, we will severely compromise the city’s ability to attract talent, conferences, business and visitors – while our ability to talk to those who live and work in the city, as consumers, will cease. These are all critical pipelines to a successful future Edinburgh and we sever them at our peril.
“Most immediately, these cuts would damage the £72M created by business tourism and the £16M delivered by the film economy. It would remove the ability for ME to rally the private sector, ending the significant financial contribution they currently make to city campaigns. It would also halt momentum and growth across all of our digital platforms; our campaigns, including edinburgh. org, the authoritative ‘Official Guide to Edinburgh’, have reached an audience of 80.1M worldwide in just one calendar year.
“With the uncertainty currently faced by the UK, we should be doing everything in our power to safeguard our economic future, rather than leaving it vulnerable.”
Another of the council’s suggestions is to cut funding to its arms length company, Edinburgh Leisure (EL) which runs all the city’s leisure outlets and programmes. The council will reduce funding to EL by £3.35 million over the next four years. (£350,000 of that will be cut in 2019/20.)
There are no closures of sports centres and pools planned as reported erroneously elsewhere.
Instead, the CEO of EL, June Peebles, explained that her focus is firmly on the next financial year and how they will improve their performance. Ms Peebles also said that EL as well as the council and Capital Theatres trust are all in dialogue about ways to deliver culture, leisure and sport services differently to make savings but maintain services.
Ms Peebles told The Edinburgh Reporter that some of the initiative must come from Holyrood : “The Scottish Government want a more active and healthier Scotland and who could disagree with the value and benefits to be had from such. There is regular media coverage on the ever growing body of evidence that identifies the positive impact of physical activity on people’s physical, mental and social wellbeing. Physical activity is often referred to as a ‘miracle cure’. And, as a country we need this miracle cure otherwise our NHS and health and social care services will be even less able to cope with demand.
“Local authorities and leisure trusts throughout the country do so much to get and keep people active and yet the Scottish Government is requiring councils to make drastic savings. As a consequence, there will less money to support people getting and staying active and healthy.
“Edinburgh Leisure is a charity but like any business we have to continuously review what we do and how we do it – we cannot afford to stand still but there comes a point when ongoing reductions to our funding will necessitate service reductions. “My plea to the Scottish Government is to fund the council so that they are in a position to meet the growing demand for services and can sustain and develop a healthier and fairer city for all of us.
“Allowing The City of Edinburgh Council to introduce a ‘tourist tax’ would also help with the finances!”
Green councillor Gavin Corbett responded to the proposed budget cuts. He said: “These are the deepest budget cuts I’ve seen in my time as a councillor. Some of the ideas have been trailed already: reduced police funding, fewer nursery teachers and public toilet closures, for example. But others are new, such as reduced funding for Edinburgh Leisure for swimming pools and sports facilities, or reduced grants for local voluntary organisations. And, for the first time, the number of job cuts - at 300 next year - is given.”