Scotland’s local authorities have been cutting jobs and services without fully understanding the costs of their actions, according to a report from the Accounts Commission today.
The report, prepared by Audit Scotland, says that council services in Scotland cost the equivalent of £40,000 every minute (£2bn a year). It urges authorities to make much more use of cost information analysis to ensure that both existing and planned activities fulfil councils’ statutory duty to provide best value for public money.
Citing case studies from a number of authorities across Scotland, the report argues that using cost information more innovatively can help councils adapt their services to meet future needs in a tight financial environment. It also allows them to demonstrate that their budgets have been well spent.
Councils that have successfully used such data include Aberdeen, North Ayrshire and Dundee, the report says. Dundee, for example, was able to analyse its spending on repairing damage to schools from vandalism and develop a strategy to respond.
‘Councils have had to move quickly to reduce their spend and of necessity have focused on methods that make an immediate impact, such as voluntary early release schemes and reducing spend in some services,’ the report says.
‘This has often been done without a clear understanding of what the cost of delivering services and functions has been.’
Accounts Commission chair John Baillie said: ‘The new councillors elected last Thursday have to get up to speed very quickly. We hope this report will help them scrutinise policy and get the right information on both quality and cost of services.’
The commission is urging officials to do more to ensure they receive good cost information for managing services, assessing performance and demonstrating value for money. Officials in turn need to give councillors this information in a form that helps them make well-informed policy decisions and scrutinise performance effectively.
The report argues: ‘Cost information needs to be presented in an open and accessible way, along with policy options and performance information to help councillors carry out their role.’
It adds that candour about costs can help keep communities involved, as well as improving corporate and partnership working.
‘It can be down to simply asking the right questions of officials, and sharing information and best practice with other councils,’ Baillie said.
‘This is a big challenge but it can deliver real dividends for councils and their communities.’
