Context
Councillor Shaw, Derek Mackay MSP and Andrew Richmond
mark Scotland Excel’s 10th Anniversary. Photo: Daily Record.
In 2018, Scotland Excel marks ten years as the centre of procurement expertise
for local government, making it one of the most successful collaborative ventures
undertaken by Scottish local authorities. During that time, we have delivered
measurable benefits to councils including an estimated £150m of savings and
efficiencies, returning around £5 for every £1 invested in our operations.
Our previous corporate strategy was developed
to support councils in a challenging and complex
environment. These challenges are no less relevant
today, and many of the commitments in our
2018–23 strategy have been developed to help
local authorities mitigate their impact. Some of
the key areas which have informed our thinking are
highlighted below. range of services and, as a result, budget cuts may
be as high as 20% in some services.
Financial challenges As part of its Education Reform Agenda, since 2017
the Scottish Government has been providing c. £120
million each year directly to schools through Pupil
Equity Funding. The findings of their consultation,
Fair Funding to Achieve Excellence in Education,
published in February 2018, found that while direct
funding offers a range of benefits, headteachers
continue to require support to deal with tasks
such as administration, f inancial management and
building maintenance.
In recent years, economic austerity has created
difficult choices for the public sector and has had a
significant impact on Scotland’s local authorities.
Audit Scotland’s 2017 financial overview report
noted a real-terms reduction of 7.6% in Scottish
Government revenue funding to councils between
2010/11 and 2016/17.
Faced with financial pressures, councils have
implemented savings initiatives such as reducing
staff numbers, rationalising property and improving
procurement. Councils are now finding it difficult to
identify further savings, and are increasingly using
reserve funding to pay for staff severance packages,
transformation programmes and/or shortfalls in
service budgets. In 2016/17, 19 councils drew on
their revenue reserves compared with eight councils
in 2015/16.
With the Fraser of Allander Institute projecting
a 2.3% decrease in the overall Scottish budget
to 2020, the financial challenges facing local
government are likely to continue for the
foreseeable future. The lifting of the public sector
pay cap, economic inflation and expected rises
in interest rates will all add further pressure on
already decreasing budgets.
National policies
In recent years, local government budget
settlements have included funding which is ring-
fenced for the delivery of national priorities such
as early learning and childcare services (ELC) and
educational attainment. This means councils have
less flexibility to manage funding across their full
Responding to national policies also brings
challenges for delivering these prioritised services.
In February 2018, Audit Scotland reported a
significant risk that councils will not have the
infrastructure or workforce in place by 2020 to meet
the expanded entitlement to funded ELC services.
Most respondents felt that accountability
for funding decisions should lie at the local
authority level, and most headteachers felt that
non-education tasks should be carried out by
someone trained in the relevant field. Councils are
therefore faced with the challenge of supporting
headteachers with their new responsibilities while
continuing to balance their central education
budget.
In 2016, the Scottish Government committed £3bn
to the delivery of 50,000 affordable homes by
2021, with 35,000 of these available for social rent.
While this programme provides a welcome capital
investment for councils and social landlords, recent
media reports about the number of new homes
currently being built each quarter suggest that
achieving this target will be challenging.
Elected members and housing associations have
called for a national procurement solution to
be implemented as an alternative to the time-
consuming individual procurement exercises
undertaken for each new housing project.
8 | Shared Vision, Shared Success. Our Corporate Strategy 2018–2023
Shared Vision, Shared Success. Our Corporate Strategy 2018–2023 | 9