Pay awards adding to Argyll and Bute Council finance worries

by Andrew Galloway, local democracy reporter

Argyll and Bute Council could be hit further in the pocket by disputed staff pay awards, it was confirmed this week.

And the Scottish Government’s draft budget, unveiled last week, is unlikely to provide amount of relief for the authority.

The council’s leader fears the authority will need to find at least another £1m of savings after the Scottish Government allocated a ‘substantially worse’ share of the budget than expected.

Cllr Aileen Morton added that there are no easy options left to fill the budget gap faced by the council, which was discussed at last week’s policy and resources committee meeting.

Argyll and Bute has received a total settlement from Holyrood of £217.8m which would be boosted to £219.4m in the event of the authority agreeing an increase in council tax at its budget meeting in February.

Cuts already proposed by the council include the removal of school ‘lollipop’ crossing patrols, the road safety unit, and a reduction in staff in adult and youth learning services.

Kirsty Flanagan, the council’s head of strategic finance, highlighted the issues as part of a report at last week’s meeting of the policy and resources committee.

A final figure for how much the authority can expect from Holyrood will be known in the New Year.

Teaching staff in Scotland overwhelmingly rejected a proposed 3% pay increase last month, with possible strike action being talked about.

Ms Flanagan said: “It is not good timing after the Scottish Government budget was produced.

“It is said that there is an increase in local government funding but COSLA have produced a briefing saying that it is in reality a cut of 2%.

“Part of the increase is in early learning and childcare, and there are commitments which we know we have to build into the budget.

“So building these in, our decrease is more like 2.5%. We have another £2m added to the budget gap.

“Another pressure not included is teachers’ pensions. Following an evaluation of the pension scheme, it has resulted in an increase of 30%, which for us equates to about £1.8m.

“We also have costs that will increase from April 1, 2019.

“We have a commitment that we will receive some of the Scottish Government’s budget but right now we don’t know how much.”

Cllr Gary Mulvaney recognised that the council was at “an impasse” on pay awards and awaiting further feedback from trade unions.

He said: “On the employers’ side, is there an opportunity to increase the offer to employees in a multi-year settlement?

“The key to that, though, is that we could not make the offer unless there was a guarantee that the government would fund something like that.

“The gap has got bigger but we cannot increase it unless there is funding from the Scottish Government. Where is our current thinking around this?

“Also, a huge chunk of our capital is £150m which was taken off us in 2016/17, and there always was a commitment we would get it back.

“For the impasse to be removed, somebody has to do something. The employer is effectively upping the settlement, but who pays?”

Council chief executive Cleland Sneddon said of the pay dispute: “The offer in these negotiations is full and final. It has been agreed by COSLA leaders a couple of months back.

“The trade unions have voted to reject the pay offer, so the proposal now is to seek out opinion with a view to strike action, but that is still to start.

“There is a real risk there will be industrial action, both by teaching and non-teaching local government staff. There is a special paper due to be produced regarding this.

“One part which has been written is that if the existing pay offer is rejected, whether a multi-year deal may yet be possible.”