Councillors told to focus on income

HIGHLAND Council could be "insolvent" if the coming winter is as bad as the last, according to budget leader Alister Mackinnon.

The grim warning was delivered during a more upbeat financial forecast than usual for the local authority.

Finance director Derek Yule reaffirmed that, based on current projections, the council is facing a £5.1 million overspend if it fails to identify additional savings this year.

Mr Yule calculated that the annual three per cent public sector pay rise announced in this week’s Scottish Government programme for the coming year would hit the council with a yearly bill of between £400,000 and £500,000.

He also told a full council meeting on Thursday that today’s pound would be worth just 90p to the local authority in real terms within three years.

On the upside, Mr Yule said things remained "challenging" but that actions already taken by his team meant they were "on the right lines".

Councillor Mackinnon, however, put a dampener on that.

He told colleagues: "If we have another hard winter there is a very high possibility that this council would be insolvent. That is the actual reality.

"It is inadvisable for us to base our financial planning on the hope that there would be another green deal or that we get additional financial assistance from the Scottish Government if there’s a hard winter.

"I cannot stress enough that we need to focus on income generation and raise income from our assets such as car parking. I know there’s strong feeling about this, but we need to take decisions and stick by them."

Also at last week's full councilo meeting there were hints that a form of "war cabinet" could be created to steer Highland Council through its toughest financial challenge yet.

Rival politicians indicated they were prepared to bury the hatchet for a united front to address a minimum projected three-year budget shortfall of £67 million.

Liberal Democrat leader Alasdair Christie said the financial challenges were now "so severe and so far-reaching" that all shades of political opinion needed to unite.

"We need to do things differently and we need to set our budgets earlier, and the only way we can do that is by working collaboratively," he said.

Earlier, a rallying call was made by city SNP councillor Richard Laird who suggested "doing away with the principle of ‘administration’ and looking at the council collectively".

Councillor Matthew Reiss, a member of the minority independent-led administration’s budget team, said: "We would welcome, genuinely, from both sides of the chamber, any and all constructive points. We will consider them all seriously.

"We are not perfect. We’ve made mistakes.

"The toilets [closure programme] has not gone that smoothly. We’ll rectify it. We will welcome any help."