Council leader Norman Hampshire warns of financial challenges

The local authority’s financial problems were starkly outlined when the council budget was agreed earlier this year, with warnings that tens of millions of pounds would need to be saved.

Now, Councillor Norman Hampshire (Lab), the leader of the council, has written to Scotland’s Deputy First Minister Shona Robison MSP, the cabinet secretary for finance, calling for an urgent cross-party meeting.

He wrote: “Not only are we facing these very acute financial pressures facing all Scottish councils, we are also being faced with very significant, immediate and ongoing recurring financial challenges associated with supporting population growth.

“Our ambition for growth is closely aligned to the Scottish Government’s National Planning Framework and national house building allocations.

The Council Leader has written to Scotland’s Deputy First Minister and Cabinet Secretary for Finance highlighting the ‘perfect and escalating financial storm’ facing the council. Read more: https://t.co/rmowt6dsEm pic.twitter.com/qYSo5sEMCG

— East Lothian Council - latest info, news & events (@ELCouncil) May 9, 2023

“However, collectively, the financial impact of all of these issues is now placing the council in what I can only describe as a critical financial situation and we are urgently facing very difficult and real decisions which will see the end of the provision of vital essential services and also mean we simply cannot support our obligations, including the construction of enabling infrastructure aligned to growth ambitions.”

All political groups on the council were working together in a bid to find solutions, he stressed.

Other nearby councils, in similar financial strife, are having to make stark choices; in West Lothian, three swimming pools are under threat of closure.

Councillor Norman Hampshire (Image: Newsquest)

Mr Hampshire said: “I am aware of West Lothian’s decision, and Midlothian and even Edinburgh have got difficult things coming forward.

"We’ll do everything we can to protect our community services but it is getting really, really tough with the levels of savings we have got to make.

“We are working hard to try to find the savings we can make.”

The letter says resources available to the council are not sufficient to meet the cost of delivering services while there is significant population growth.

Most of the council’s income comes from a central government grant, with council tax only making up about a quarter of the council’s resource base.

The plea comes at a time when new or expanded schools are being delivered in East Lothian, and while the council is experiencing increased demand for services such as referrals to children’s services and increases in household waste.

Mr Hampshire said: “The options now facing this council are neither palatable, or in the best interests of our communities both local and national, and without some help to support, I accept will have a long-term detrimental impact to society as a whole.”

East Lothian’s working age population is projected to increase by 8.6 per cent (the joint second highest in Scotland which has a projected increase of 3.3 per cent) by 2028.

At the same time, the county’s pensionable age population is expected to increase by 10.9 per cent (the highest in Scotland, which has a projected increase of 3.7 per cent).

And the number of school aged children in the county is expected to increase by 17.1 per cent by the same period.

The Dunbar and East Linton ward member believed tens of millions of pounds would need to be saved simply to “stand still”.

He added: “This is very stark and a very different scale from other authorities, and for a council of this size, is simply unsustainable and quite frankly unmanageable.”

Councillor Lyn Jardine (Image: Contributed)

Councillor Lyn Jardine, leader of the SNP Group on East Lothian Council, said there were “significant challenges ahead”.

She told the Courier: “If we struggled to balance the current year’s budget, future years are significantly more difficult to be able to deliver.

“The cost of living crisis, inflationary pressures and fuel costs are all extraordinary impacts on limited budgets.

“What is not extraordinary, and could be changed if the political will were there, is the approach of the Tories in Westminster to delivering the mythical balanced budget at a national level, while imposing austerity on public services and the most vulnerable in our society.

“I’m old enough to remember when Maggie Thatcher first equated the nation’s finances as similar to household budgeting and, because it fits their low tax, low spend, small government philosophy, they’ve clung to it like children to apron strings ever since.

“Meanwhile, in the real world, the Scottish Government has prioritised early years, poverty and mitigating as much of the Tory austerity agenda as they can, but have to deliver a balanced budget, as do local authorities.”

Councillor Lachlan Bruce (Image: Contributed)

Councillor Lachlan Bruce, leader of the Conservative group on East Lothian Council, described the financial situation as “dire”.

He said: “The financial circumstances East Lothian Council face are dire due to year upon year of cuts by the SNP and Greens.

“They prefer grandiose projects that fail like the deposit return scheme, national care service and building ferries that don’t float to delivering local services for people.

“The cross-party group to look at options could be helpful but we can’t just keep doing what the council has decided to do recently against our objections which is sticking their hands in the pockets of local residents and businesses by putting up council tax by large amounts and introducing parking charges which will harm local businesses.

“The council has to save money by using our resources more efficiently and getting rid of buildings it does not need anymore.”

Councillor Shona McIntosh (Image: East Lothian Council)

Councillor Shona McIntosh, who represents the Greens on the council, described local government funding levels as being “at crisis levels” across the country.

She said: “I thoroughly agree with Mr Hampshire’s letter to the Scottish Government arguing that this growth will no longer be sustainable if a change is not made to the way we are funded.

“It’s particularly frustrating that the sort of action we know we have to take to address the climate and nature crises are being jeopardised through lack of funding.

“We need more staff expertise to help us map out our path to zero emissions but it’s really hard for me to make that case when vital frontline services that address health, educational and social inequalities are also under-funded.”

A spokesperson for the Scottish Government said decisions on local government allocations for future years were subject to the outcome of negotiations with local authority umbrella group CoSLA.

He said: “The Scottish Government has increased the resources available to local government in 2023-24 by more than £793 million, a real terms increase of £376 million or three per cent, compared to the 2022-23 budget figures.

“It is the responsibility of local authorities to manage their own budgets and allocate the total financial resources available to them on the basis of local needs and priorities.

“In 2023-24, East Lothian Council will receive £221.5m to fund local services, which equates to an extra £8.1m to support vital day to day services or an additional 3.8 per cent compared to 2022-23.

“In addition, all councils will receive their fair share of the currently undistributed sum of £329.8 million.”