Council faces potential £66.7m bill
FINANCE chiefs have warned that Highland Council may need to find further savings of £66.7 million over the next three years.
They have stressed that the projected figure is merely indicative, because final figures will hinge on the scales of government grant and annual staff pay increases.
And councillors will be asked this week to press the Scottish Government to rewrite the rules governing second-home council tax.
Finance officers have suggested councillors lobby MSPs in a bid to secure the £2.6 million that is currently ring-fenced for building so-called affordable housing.
Directors had previously suggested the deficit could be anywhere between £34.1 million and £124.9 million. Council tax increases are thought to be certain to help plug the gap.
Any year-end overspend may need to be bailed out by the council’s reserves fund that stood at £9 million at the start of the financial year, which is below the minimum level recommended by public finance watchdog Audit Scotland.
With a current projected deficit of £5.1 million, the reserves could slip to £4 million by next April.
The council’s head of corporate finance and commercialism, Ed Foster, stated in a report to Thursday’s full council meeting that the black hole must be addressed by "spending less, by stopping or reducing services and by delivering them more efficiently".
Mr Foster also reminds councillors of the need to generate more income, perhaps by increasing fees for council services not covered by council tax, which represents 21.5 per cent of the overall external funding.
The £66.7 million calculation is based on an estimated one per cent reduction in annual government grant and three per cent pay award.
