False Economy

This week, East Lothian Council passed a three-year budget that the Labour-led but Tory-chaired Administration said would “take the county out of fiscal chaos and on a journey towards a more stable financial future” as the new Leader Cllr. Willie Innes put it. Since the amount of funding available for services currently forecast to drop from £195.7m to around £191.4m over the next three years, these are troubled fiscal times. But is this the right budget to cope with that?

The accusations of fiscal chaos are a bit rich. The previous SNP-led administration had invested heavily in new affordable housing (which eventually pays for itself through the rents charged) and necessary public works like Dunbar Primary, the John Gray Centre, Tranent Care Home that had the secondary effect of keeping many residents in work while jobs in private building all but disappeared locally. (see Corned Beef Auditors for a more detailed discussion of this).

They are especially rich because in 2007 Cllr Innes was outgoing Cabinet member for Social Work, a dysfunctional department that, under his tutelage, habitually overspent its budget by £1/2m each year, careening from a £10m to a £40m budget in less than a decade. After firing the Head of Service and focussed work by the SNP administration, not only did the ASC department but the entire council come in on-budget in each of the last four years, including this one that Cllr Innes seems so upset about.

The budget debate was certainly unusual, not least because, at 2 hours, it was twice as long as any of the 13 others I have experienced since election. Almost every one of the 22 councillors present had their say. As might be expected, it split down party lines and partisanship exhibited by both sides. But an objective observer—had any such exotic creature have been present in the chamber—would have been puzzled at conclusions drawn and how the decision taken derived from what the Administration speakers actually said.

Labour, as usual, claimed this to be a budget for the vulnerable and for the future—especially for our children, while correcting the profligacy of the previous administration. And yet, examination of the figures showed that they were planning to reduce Social Work by almost £2m, with £500k coming out of Children’s Services’ £10m budget (a 5% cut). Leaving aside the moral argument, the demand on Children’s Services lies almost totally out-with management control and demand for Social Work from the elderly expected to rise at over 5% each year. Were that enough, hidden in 37 separate places were purchasing savings labelled ‘BuySmart’. While some savings here are indeed possible (SNP suggested a total of £250k in their budget) Labour had tripled  this to a hopelessly optimistic £750k.

Then, despite a manifesto pledge from Labour that promised “an extra £100,000 for each high school”, not only did this sum not materialise but something like half this amount was taken OUT of each DSM (Devolved School Management) monies given to schools to run their affairs semi-independently. This will cut school activities, materials or support staff. Their budget also removed free school meals for P1-P3 classes from the large areas in the West of the county where these had been provided.

The explanation given was that the really needy on benefits qualify for free school meals anyway. But this misses the whole point. Three years ago, on advice from the best practice of early intervention, a whole package was put in place for areas of deprivation. As well as free school meals, this consisted of extra teachers to bring P1-P3 class sizes down to 18, a Place2B programme of support and guidance for pupils and dedicated police teams who have time to get involved with local social issues and work closely with both the ELC ASBO and Warden teams.

The whole effort was regarded as an investment because practice elsewhere has shown that the many problems and intensive social work and police intervention with troubled teenagers can largely be avoided by early intervention: “Give me a child until he is seven and I will show you the man“. While all of this may not be jeopardised by removal of free school meals, it reintroduces social stigma and divisiveness to those who do get them and an extra burden of £500 per child per year on parents earning as little as £16,900 p.a. These are exactly the parents who are struggling to make ends meet and NOT throw themselves on the dubious mercy of state benefits.

In the same class of false economy but with perhaps more import was their decision to remove almost £1/4m funding from volunteer group support. Ranging from First Step in Musselburgh to the Special Needs Playscheme in North Berwick, volunteers play a huge role in providing services that communities need but the public purse can’t afford. When compared to how community volunteers are enabling museums in both those towns to be viable through council seed funding this appears counterproductive : it will wind up costing the council more than it saves, plus widespread disruption to well loved services in the meantime.

And, along those lines, the removal of refurbishment funding for both the Haddington Day Centre and Abbey Care Home from the capital plan to allow a £800k ‘ slush fund’ for Labour pork barrel projects (watch for Ormiston Bowling Club being bought for a 6-figure sum) flies in the face of the high regard and demand both those facilities enjoy. The tragedy of the Abbey is that its original funding was the only hope of triggering a more positive attitude from NHS Lothian over the Edington by providing seed cash to make a joint project viable, as Scottish Government wishes to do by merging ASC and NHS into a more coherent single service.

But most bizarre was the manner in which Labour member after Labour member used their five-minute speech to berate the Opposition’s record and budget for profligacy and damage to council finances and spend little time praising the merits of their own. Perhaps they were confused; perhaps the more perceptive were embarrassed. Because, having spent hours lambasting the previous administration for investing too much with related interest payments and not spending enough on the vulnerable and our children, three things were clear:

  • The SNP budget placed a lower capital burden than the Administration’s did
  • The SNP budget placed a lower interest burden than the Administration’s did
  • The SNP budget provided almost £2m more for ASC, Children’s services and education than the Administration’s

So Administration members would have reached their purported goal of fiscal penance easier by voting for the SNP Opposition budget; why they chose the false economy of their own you must ask them. Having created or contributed to a dozen budgets to date, my prediction is an irrecoverable overspend of £500,000 in Social Work and a six-figure purchase of an unnecessary facility in the West of the county before the year is out. How either helps the vulnerable or the residents of East Lothian in general escapes me.

About davidsberry

Local ex-councillor, tour guide and database designer. Keen on wildlife, history, boats and music. Retired in 2017.
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