Tough budget choices ahead

As the recession continues and demand for services increases, the Council faces years of difficult spending decisions

On budget day (11 February) next year, the Council will face the hardest decisions in living memory to be taken in Edinburgh.

This is due to the scale of the financial challenge being experienced by the public sector, which is unheard of in modern times.

Massive national public debt, which will need to be repaid, as well as reduced tax income and increased benefit payments, mean the Council is facing huge financial challenges for at least the next four years.

Unemployment and lower incomes means there is more demand for services, especially for vulnerable people. There is a growing and ageing population with more disabled adults living longer and more children at risk who need the Council’s help.

Unprecedented levels of savings need to be found – about £90 million in the next three years.

This means savings of approximately 10 per cent on support costs across all Council departments and 4 per cent on frontline services, followed by a further 4 per cent across the board in each of the next two years.

Tom Aitchison, the Council’s chief executive, said: “In the many years I’ve worked in local government, I’ve certainly never experienced anything like this situation before.

“We’ve got less money coming in, we can’t get a good price for property and, at the same time, the increased demand for our services is only going to continue.

“We are ready for the challenge ahead but dealing with this situation successfully is going to mean massive changes in what we do and how we do it.

“The days of people seeing the Council as being able to fund every project and initiative are truly over, and everyone needs to face up to that. We will need to be much more focused on the services that we really need to provide and this will involve incredibly difficult decisions.

“The reality is that the public sector is not immune from the harsh economic realities which the country is facing.

“However, I believe that the city and the Council have the resilience and the determination to respond positively to the current difficulties.

“We are preparing well for these exceptional times and action is being taken to look at alternative ways of providing and modernising services to ensure that the public continues to receive value for money.

“A fairer pay structure for staff has been proposed and improved working practices have already resulted in considerable savings, helping to ensure that we can maintain essential, frontline services.”