Council raids reserves to fund overspend

Scottish Borders Council headquarters in Newtown St Boswells.
Scottish Borders Council headquarters in Newtown St Boswells.

Scottish Borders Council had to take almost £2.8m from its reserves last year to plug a deficit in its revenue budget.

At the start of 2014/15, the local authority set its spending – funded by Council Tax and Scottish Government grant – at £252.209m, but by March 31 this year the council had spent £255.071m.

The deficit was plugged by reducing general fund reserves which, as a result, fell to £14.339m.

Apart from environmental services, the finances of which benefited from the withdrawal of garden waste collections, all other council departments contributed to the overspend.

According to provisional outturn figures for all Scottish local authorities, published by the Scottish Government last week, individual spending for each SBC department in 2014/15 was as follows (start of the year estimates in brackets): Education £105.298m (£104.666m); social work £67.272m (£66.984m); roads and transport £16.748m (£15.024m); environmental services £14.338m (£16.572m); planning and development £2.591m (£1.105m); cultural and related services £13.915m (£13.330m); other services £34.912m (£34.528m).

In the previous year, SBC exceeded its estimated revenue spending of £246.722m by just £142,000.

Estimates for 2015/16 predict a surplus of £352,000 with total expenditure of £254.571m and total income of £254.923m.

SBC was not alone in exceeding its spending estimates in 2014/15 with 22 of Scotland’s 32 councils also recording overspends which, across the country, totalled over £98m.

However, other local authorities did manage to make a surplus, including neighbouring East Lothian which spent £3.210m less than predicted at the start of the year.

New data has also revealed that SBC came second highest of all Scottish councils for the percentage of its running costs which went on “administrative support” during 2013/14.

The Scottish Government’s Improvement Service has revealed that the proportion at SBC was 7.5%, marginally behind top spender Clackmannanshire and well above the Scottish average of 5.1%.

The amount spent on admin support has risen progressively since a major restructuring of departments and job titles began at Newtown in 2010. In 2011/12 it was 5.6% of total running costs and in 2012/13 it was 6.1%.