Scottish efficiency plans are not enough, warns Audit Scotland

24 Feb 10
Public sector plans for savings in Scotland will not be enough to meet the serious financial challenges that lie ahead, the country’s spending watchdog has warned.
By David Scott

25 February 2010

Public sector plans for savings in Scotland will not be enough to meet the serious financial challenges that lie ahead, the country’s spending watchdog has warned.

In a report published on February 25, Audit Scotland said options were needed. It cited a more flexible deployment of staff, reduced staffing levels, rationalising assets and seeking alternative ways of providing services.

Without addressing those options and undertaking a more fundamental review of services, public bodies might not be able to reduce their costs while maintaining the levels and quality of frontline services, the watchdog stressed.

The public sector in Scotland has made provision for annual savings of 2%. But Audit Scotland believes that this ‘will not be enough to bridge the gap between projected future spending and funding’.

It added: ‘The scale of the financial challenges facing the Scottish public sector means that a new approach is needed that fundamentally reviews priorities and the delivery of services.’
The report, Improving public sector efficiency, pointed out that Scotland’s public sector was finding more efficient ways of providing services.

Reported efficiency savings in 2008/09 exceeded the Scottish Government target by more than half.
But the watchdog said Scottish public bodies were facing the greatest financial challenge since devolution.

It advised that, to become more efficient and effective, they needed to improve information on productivity, quality and performance. They would also have to extend joint working for providing services.

The report said there was already a significant amount of joint working, especially between health and social care. But there was a continuing need for more and better co-ordination between public sector organisations to improve productivity and safeguard the quality of services.

Around a fifth of councils and a third of NHS bodies have relied on non-recurring savings such as asset sales. But Audit Scotland believes that relying on one-off savings in the short term ‘is not a sustainable option for the future’.

Deputy auditor general Caroline Gardner said the public sector continued to ‘perform well in finding more efficient ways of working and trimming the amount of money needed to deliver services’.

However, she warned that 2% savings would not be enough and added: ‘Difficult decisions and new approaches will be needed to find other ways to increase efficiency and reduce public spending.’

John Baillie, chair of the Accounts Commission, which is responsible for the audit of local government, said most councils needed to ‘increase significantly the level of savings made’.


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