EAST Ayrshire Council's leader has insisted that the local authority is in a better place to deal with economic ‘dark times’ than other councils after hearing about plans to address a potential £20m overspend.
The council’s finance chief Joe McLachlan told cabinet that the decision to back a spend to save approach would stand the authority in good stead.
He said: “There is the potential, if left unchecked, for the council to end the financial year with a possible overspend of around £20m at March 2025.
“I would stress, however, that this is only if no action is taken to reduce costs and demand.
“As members are aware we’ve taken previous action to prepare us for today.
“You have approved the creation of an innovation fund to support services to
transition and innovation and, more importantly, you took the unprecedented step of setting aside £40 million to tackle poverty and support services to undertake actions to support early intervention and prevention, allowing spending to take place today that would reduce costs tomorrow.”
READ MORE: Robot cleaners bid moved forward at Cumnock school
Mr McLachlan did warn councillors that this was vital ‘as the signs are there that there will be no more funding in addition to what councils have already received’.
“As such we will have to manage costs and demand so that our costs align to our budget and options around service delivery will have to be reviewed with collaboration, early intervention and prevention, and prioritisation forming part of that change.”
He said that council management had already ‘set in motion a series of precautionary measures to ensure that the potential projected overspend does not materialise’.
“They provide time for services to reflect and set out the necessary plans to enable change to take place.”
READ MORE: Innovative council projects approved to help with financial savings
Mr McLachlan said that EAC faced the same pressures as other authorities, but said: “Our council has taken steps to prepare us for today and the creation of that £40 million fund to support a intervention and prevention will support the council into the future.”
He noted that there were moves to address the cost of higher staff absence levels, by spending £600k to support wellbeing among the workforce.
Council leader Douglas Reid said: “It’s dark times but we’re probably in a better place than others to deal with this and, if we work collaboratively and collectively, we can tackle this.
“As you say that’s a £20 million overspend that will only exist if we don’t take action, and we’ve already taken action through our recovery plans and innovation plans.
“We do need to look at cost and demand but, ultimately, we’ve got to protect our communities from child poverty and protect the most vulnerable out there where we can but keep the economy growing as well at the same time.”
READ MORE: East Ayrshire Council set out plan to deal with £6m overspend
He added that that the council would ‘brace itself’ for the outcome of the next UK budget in October.
He said: “It’s a difficult circumstance we face, but I think most people recognize this was coming our way and I think we’ve been in a state of preparedness.”
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here