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Council's budget approach slammed in new audit

By Scott Maclennan

council HQ
council HQ

Highland Council’s approach to budget setting has been heavily criticised in an audit report due to be discussed by councillors this week.

Accounting giant Deloitte said some aspects of the council’s approach are “without rationale or justification” in the report which was commissioned by the local authority to help inform internal reforms.

Among its claims are that not providing councillors with the full range of budget detail seen by council managers means a true financial picture is not available to elected members in time for any issues to be properly addressed.

The report also says a practice of applying an annual across-the-board 10 per cent rise to council fees and charges demonstrates a “lack of commercial awareness”.

Auditors said: “Where services disagree with the uplift but adhere to it – historical examples include music tuition and school meals – there has been a drop in demand which exceeds the additional income raised, ultimately resulting in lost income for the council.”

Auditors also said many staff consider the budget merely a “box-ticking exercise” and added: “The effectiveness of the budget as a performance monitoring tool is undermined due to the lack of consequences for failing to deliver.

“Services have expressed concern that those areas which perform well are essentially ‘punished’ for their good performance by being required to make additional savings, whereas areas which fail to stay within budget are ‘rewarded’ by being given additional funding.

Councillor Ken Gowans, non-aligned member for Inverness South, said: “This is a deeply concerning report, especially worrying given many of these issues have appeared in earlier versions.

“The lack of communication and information management will be of no surprise to opposition councillors who have had to resort to FOI requests and tabling questions at full council meetings to prise information out of a reluctant administration.”

Highland and Islands Con-servative MSP Edward Mountain said: “This report shows that Highland Council does not differentiate between financial diligence and financial incompetence.

“Indeed, departments that underperform get more money and those that stay within budgets get rewarded with extra cuts. This is ridiculous.

“I have confidence that the Conservative councillors will be addressing this hugely disappointing report with council leader Margaret Davidson and the new chief executive.”

Highland Council was asked to comment but failed to respond before deadline.

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