The Chancellor delivered the comprehensive UK spending review in October, setting in train a series of steps which will change the nature of Scottish public services. The Scottish Budget - fourth and final budget of the third session of the Scottish Parliament - was announced on 17 November by the Cabinet Secretary for Finance and Sustainable Growth, John Swinney. And in a Local Government and Finance Circular on 9 December 2010, provisional total revenue and capital allocations for Councils were published.
These budgets could fall further. On 17 November, the Cabinet Secretary and the President of COSLA wrote jointly to Council Leaders to set out a package of measures being recommended to local authorities in return for the provisional funding and year on year reduction in total revenue funding of 'just' 2.6.%. If a Council does not agree in principle to those measures, including a 'pay freeze' for those earning over £21,000, by 21 December 2010, the total revenue funding for that Council will fall further still. For all 32 Councils the total amount at stake in that way, which Scottish Ministers might redeploy elsewhere in the Scottish Budget, is around £427m.
The Budget Bill for 2011/12 covers a range of initiatives such as the new "Large Retailers supplement". Proposals for tackling climate change and energy efficiency, in line with the ambitious statutory targets set in the Climate Change (Scotland) Act 2009, should see an increased investment in the growth of Scotland's high-potential renewable energy sector. Significant investment in infrastructure is to be made to allow the economy to more effectively compete and succeed. For transport, these include investing £30m in the design and development of a replacement Forth crossing and investing £842.9m in rail infrastructure through Network Rail and rail services through the rail franchise.
Still, the constrained Scottish Budget for 2011/12 foretells tougher times ahead, affecting many areas of public services. The Independent Budget Review has suggested that budgets may not return to 2009/10 levels in real terms until 2025.
Along with other methods of reducing Public expenditure to meet the challenge, the Scottish Government recently announced the set-up of a Business Management Consultancy framework for professional services across the Scottish Public Sector as a whole. Details of the programme, which is expected to achieve an average of over 35% savings, can be found by clicking here.
MacRoberts are delighted to have been appointed to this framework in a consortium with The Hay Group and Career Associates.
But the Independent Budget Review Panel also expressed the view that "the funding gap is unlikely to be bridged by efficiency savings alone". On 19 November, the First Minister announced a new Commission on Public Services will examine options for delivery and reform of Scotland's public services, which should consider how best to bridge that gap.
MacRoberts LLP has recognised expertise in all areas of Public Sector & Government law in Scotland as our consortium appointment to the Scottish Government framework shows. Please contact Katy Wedderburn or Duncan Osler in relation to MacRoberts and the Framework.
Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
