Caithness councillor quits committee vice-chair role over 'impossible' budget pressures
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Caithness councillor Matthew Reiss has resigned from a senior position because of the "impossible" budget pressures facing the local authority.
He cited a range of reasons for his decision to quit as vice-chairman of Highland Council's corporate resources committee, the main one being a lack of money for local roads.
The councillor for Thurso and Northwest Caithness warned that spending on roads is set to be cut to about a third of what is needed "just to stand still". He also described the campaign groups Caithness Health Action Team and Caithness Roads Recovery as "two red warning lights" that the local authority cannot ignore.
Councillor Reiss, who had been committee vice-chair for around four years, announced his resignation from the post at an administration meeting last Wednesday. He intends to set out his reasons for standing down from it during a full council meeting tomorrow (December 9) when members will be asked to approve a Medium Term Financial Plan itemising the capital strategy and capital programme to 2036/37.
Councillor Reiss is calling on Kate Forbes, Scotland's finance secretary and the MSP for Skye, Lochaber and Badenoch, to look again at how rural councils are funded.
“I'm not in the habit of quitting but I basically resigned for three reasons," he said.
“The first one, and the key one for Caithness, was the roads.
“We need £26 million to stand still and roughly speaking the budget papers for the financial year after the next one, i.e. from 2022/23 onwards, suggest we spend slightly over £8 million on the roads. I can't sign up to a budget that proposes in the not-too-distant future to reduce the expenditure to approximately one third of what is required just to stand still.
“I don't attach any blame to Highland Council. The only reason we've been able to increase the expenditure this financial year and next, by £10 million each year, is because the council in my view, financially speaking, has been well run, and all credit to the chief executive and her team for that.
“But it's simply impossible, given the public anger about the state of our roads. I cannot and will not associate myself with any cut to this budget, let alone one of this size.
“The second one is the overall budget. It grieves me to have to say this, but within the last week senior finance officers have told members of the administration that we need to spend £190 million per annum on capital projects over the next 10 years.
"We only have about £50 million on average per annum available, so it appears to me it is impossible and no amount of talk about new strategies, the redesign board or trying to attract inward investment is going to remotely address this daunting, impossible problem. Proportionately we have the highest level of debt of any Scottish local authority.
“Officers told us we needed approximately £1.7 billion of expenditure over the next 10 years. That has been stretched out of sheer desperation to 15 years, and some significant projects have been sidestepped because they are financially impossible.
“Examples include the Stromeferry bypass and a replacement Corran ferry. To get a new ferry, and to do the slipway upgrades that would be required, that's about £57 million – which is more than we've got for an entire year for everything.
“I have a particular concern about some of the roads depots in terms of health and safety.
“The third reason is that the council needs to recognise the really serious problems in the peripheral areas of Highland, particularly depopulation.
“People in Caithness are starting to get exasperated at the steady flow of 'good news' stories that the council's media office is putting out about the Inverness area.
“It's not to begrudge the prosperity of that area but we have serious problems and 'Team Highland' needs to reconsider, or this team might fracture.
“In my opinion, in Caithness, Highland Council has had two red warning lights flashing for a long time: Caithness Health Action Team since 2016 and now Caithness Roads Recovery. I think it is essential that the council reaches out to understand these campaign groups' concerns.
“What's the solution? There is only one person in Highland who can sort this and her name is Kate Forbes.
“I've heard plenty of compliments that she is a woman of integrity. She alone has the ability and the wherewithal to reconsider how rural councils, especially Highland, are funded.”
Councillor Reiss added: "I've been vice-chair since 2017 I think and my concerns have gradually grown, and now for me it's the crunch point. Either we sign up to this paper exercise or we take the gloves off and politely state the icy cold reality that we need a lot more money.
"Five per cent of the Scottish Government's roads budget for 12 per cent of Scotland’s council-maintained roads is wrong. The public needs to know the state of local authorities' finances generally, and especially Highland.
"A lot of work and meetings preceded this paper and I explained my misgivings. Yes, the new administration could rewrite this plan, but they won't have a penny more and would face the same chasm."
The Medium Term Financial Plan highlights a "stark mismatch" between affordability and potential investment, with the council "only able to afford around one fifth of the identified investment requirement".
Other extracts from the document include:
- "The level of capital investment that the council has been making over recent years and intends to make over the next three years (over £100m in each of those years) cannot be sustained indefinitely without a substantial increase in the loans charges budget. The impact of not being able to sustain that level of investment may result in the overall condition of the council’s assets deteriorating or may lead to the interruption of, or inability to sustain, current service levels."
- "Given the substantial level of spend involved, the nature of capital investment projects, and the long-term nature of the capital plan, a large number of risks need to be considered... Inflation will erode the future value of the sums identified in the capital programme and as such projects may not be deliverable in the future within the budget proposed."
- "Members are aware that Highland is already the local authority with the highest proportion of its revenue budget that is being used to finance capital investment. Maintaining or increasing that proportion will mean all other areas of the council’s revenue budget will face a higher burden in identifying and delivering savings over the long and medium term."
- "Officers have undertaken an assessment of potential areas requiring capital investment over the period to 2030/31... That work identified a potential investment envelope of over £1.7bn, averaging over £190m annually, which is far in excess of what is considered affordable over that period within the current loans charges budget.
- "A large number of projects have to be viewed as unaffordable."
- "There are certain projects... that are of such magnitude that the council will not be able to deliver them unless a comprehensive external funding package is identified."
- "Whilst the council’s ambition is to maintain this higher level of investment, over and above the proposals in the 15-year plan, this is not affordable without a recognition of the particular infrastructure challenges of the Highlands and the need for the council’s annual capital allocation to be substantially increased; or the identification of other forms of external funding; or a combination of the two."
