Fife Council at ‘turning point’ to provide services without major cuts, report warns

Public spending watchdog, the Accounts Commission, said it was managing serious pressures and a cumulative gap of £46.5 million by 2027/28 - and will have to significantly change how delivers services to make the savings needed.

The report also highlighted deepening inequalities, including a growing gap in the life expectancy between Fife’s poorer and wealthier areas, how key services such as social care are deteriorating, and the council’s large health and social care overspends are not sustainable.

The largely favourable report into the council’s finances and performance was welcomed by leader, Councillor David Ross, but he disputed its interpretation that it has failed to make savings or modernise its operations over the years.

He said: “I believe Fife is a well run council due to the efforts of staff and managers at both corporate and service level and should be given much more credit for being well managed and forward looking. We are not prepared simply to manage decline but will continue to protect and improve services as far as we can.”

The Commission reported that the local authority has demonstrated “competent financial management over the years” and managed to avoid making significant cuts. However, the watchdog said the Kingdom has now “reached a turning point” and is managing significant pressures and a cumulative gap of £46.5 million by 2027/28.

“The council will have to significantly change how it delivers services to make the savings needed,” the Account Commission’s report stated. “Added to this, the council’s money set aside for contingencies dipped below its rolling three-year target. This will need to be monitored.”

The commission was particularly concerned about worsening inequalities and slowing improvements in areas such as children’s services and adult social care – despite limited savings.

The watchdog also highlighted the large overspends in Fife Health and Social Care in both 2023/24 and in the current year. Fife’s Housing Revenue Account is also under pressure with “urgent plans now required to meet financial gaps” and enable future investment in affordable housing.

Andrew Burns, deputy chair of the Accounts Commission said: “Fife Council has reached a turning point. Significant change needs to happen now to ensure the sustainability of services and so the council can continue to balance its books. Tough decisions lie ahead.

“The council has excellent engagement with local communities and strong working relationships across councillors of all parties. It must now build on these strengths, working with communities to develop clear plans on how significant savings and changes to the delivery of services can be made.”

Ken Gourlay, chief executive of Fife Council, said the findings highlighted a number of challenges that are “not unique to Fife”.

“We are operating in difficult financial times – difficult both for public services and the residents we serve,” he said. “Poverty is entrenched in parts of our society leading to widening inequality gaps, pressure on health and social care services is escalating as our population ages, and there’s an ongoing housing emergency.”

He added: “These are issues across Scotland and tackling them in Fife is at the heart of our plans.”

The council also received its fair share of praise. The commission said Fife has some “strong foundations for the future” – including strong engagement with local communities.

The Commission welcomed the minority Labour Administration’s leadership “in fostering the joint arrangements required to make effective decisions”.

It was also praised for implementing “innovative solutions” to address its workforce challenges and developing three-year plans across all services to deliver change. The commission was also encouraged to see improvements in performance reporting in response to audit recommendations in 2022/23.

Mr Gourlay explained: “We have a strong record of delivering change with two large scale programmes being delivered in the last 10 years. That said, we recognise that the pace and scale of change must ramp up to meet the challenges ahead.”

Mr Gourlay also said there’s a “clear plan” to reinstate general fund balances to Fife’s 2% target

He added: “We will continue to develop and implement our transformation plans and I welcome the fact that the Commission recognises the strong foundations we have in place for this work.”

To support its priorities the council is focused on some key aspects of service transformation, including: a new approach to crisis prevention and wellbeing that will help individuals and families access all the services and support they need at the right time; digital transformation that will make use of modern technology to improve services, including learning in schools, and help staff work more productively; and a place focus to help services join up and co-ordinate resources more effectively in local areas.

Cllr Ross welcomed the “generally fair”report, but disputed its views on savings.

He said: “To infer that the Council hasn’t made significant savings is just plain wrong. The Council has made £380m in savings since 2006, equivalent to more than a third of its overall budget. It has reduced its staffing headcount by over 1500 since 2010 and has implemented a number of large scale change projects over that period. Fife has one of the best performing Health and Social Care Partnerships in Scotland.

“The budget we set last week strikes a balance between making savings, investing in services and increasing the Council Tax. It provides services with a degree of certainty and sustainability on which to plan. The forecast £46.5m budget gap by 2027-28 has already been cut by two thirds and our reserves have been restored to the target level. This gives Fife Council a solid foundation for the next three years that should allow us to avoid drastic cuts to services and take forward a positive programme of transformation for improvement.”