Magazine article Public Finance

Scotland 'Has Been Too Slow in Preparing for Spending Cuts'

Magazine article Public Finance

Scotland 'Has Been Too Slow in Preparing for Spending Cuts'

Article excerpt

Scotland has not done enough to address the public spending crisis and must act more quickly, according to local government finance directors and chief executives.

They gave their verdict on the public sector's handling of the preparations for budget cuts at a Public Finance debate in Glasgow on November 11. It was held just days before the Scottish National Party government announced pians that will require a £1.3bn reduction in its budget next year.

An audience vote taken at the end of the debate showed that a decisive 75% believe that Scotland has not sufficiently addressed the financial crisis and needs to prepare more quickly for the cuts. The vote was 26 for and 8 against.

Finance Secretary John Swinney decided earlier this year to delay making any cuts until 2011/12. In a report in June, the influential Scottish Parliament finance committee described public sector leaders' efforts to prepare for forthcoming budget cuts as 'patchy and lacking in urgency7.

Finance directors were unwilling to comment publicly on the outcome of the vote but pointed out that while the priority was to immediately deal with the cuts, the Scottish Government needed to take a longer-term view of the future shape of public services.

Speaking after the debate, Don Peebles, policy and technical manager at CIPFA Scotland, said local government had taken steps towards addressing the cuts.

But, he added: The responses from panel members and the conclusion of directors and chief executive officers support the view that the pace of reform to date has been slower than was necessary and now has to be accelerated to enable Scotland to prepare for the cuts.'

The debate, sponsored by Threadneedle Investment Services and chaired by PF editor Mike Thatcher, was attended by members of the CIPFA Scotland directors of finance section and the Society of Local Authority Chief Executives and Senior Managers.

It featured a panel of four experts: Bob Black, auditor general for Scotland; Robert Wilson, one of the three wise men' who carried out an independent budget review on behalf of the Scottish Government; Paula Speirs, director of local public services for consultancy Ernst & Young; and Ronnie Hinds, chief executive of Fife Council and vice-chair of Solace in Scotland.

Black said there had been no change since Audit Scotland told the Holyrood finance committee that a 'sense of urgency and realism' was needed.

There was a need to distinguish two phases of the approach to spending cuts, he said. The first was a short-term imperative to get costs down and budgets to balance. Some really tough decisions were already being made.

But somehow we need to give a sense of urgency and realism to the longer-term debate,' he added. Issues such as the future design of public services had to be considered.

Wilson said that 'the financial crisis is here and the time for action is now5, irrespective of whether the public sector had dealt with the problem quickly enough. ? believe the reality of the situation is not about presenting it in a negative way, or pointing the finger... the issue is we are where we are and we need to act very quickly in terms of addressing some of these issues,' he added.

Hinds emphasised the need for a strategic view. He warned: While speed is of the essence because of budgets, the damage we could do by acting very quickly and precipitately is quite significant and would be with us for a long time. There is a responsibility on myself and others in this room to try to take a strategic view.'

Speirs stressed the danger of focusing on cuts and said it should be a time for innovation and looking at service redesign. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.