Gray offers reassurance over high school budget
Councillors have been assured the new Anderson High School should be completed within budget.
Head of the SIC’s finance department, James Gray, has told members the project is still on track to be built within its £42 million limit.
The new school is the council’s flagship project, with £28 million of the cost coming from the Scottish government. The council is considering external borrowing to fund the new school.
The question of a possible overspend was raised by audit commitee chairman Allison Duncan, who wondered whether it would be up to the SIC to stump up the extra cost if it did go over budget.
“If the budget has to be overspent, for any reason, on the Anderson High School project, where does the funding come from – the Scottish government or the council?”
Mr Gray said there were “no guarantees” – not least because the exercise was, so far, being carried out on paper. But he insisted indications showed the school should cost no more than the allotted funds.
He also pointed to a £2.5 million contingency earmarked for any “abnormal costs”.
He said the authority would aim to have discussions with the Scottish Futures Trust if the project started costing too much.
“I suspect we’d stand a chance of getting extra funding,” he told councillors.
Meanwhile, a report outlining differences in secondary education costs between Shetland and other island groups is due to go before councillors next month.
Members heard July’s education and families committee would receive a report showing the disparity between Shetland secondary education and that of Orkney and the Western Isles.
One contributing factor is believed to be that the SIC includes in its schools’ budget figures relating to early retirement, whereas, in Orkney, the costs are separately absorbed.
The issue came up at today’s audit committee meeting, where Mr Duncan praised finance staff, he said, for helping bring the council out of the “mire” it found itself in four years ago.
But he warned challenges still had to be faced for years to come, in particular, with the council’s moves towards school closures which has already seen hundreds turn out in protest.
Mr Duncan described positive findings presented by Audit Scotland – in which no so-called “red card” warnings featured, compared with eight in 2010 – as “music to my ears”.
The Flea was vice-chairman of the then audit and scrutiny committee when the council was “right up to the neck” only four years ago.
He said the prolific overspending by the authority four years ago risked leaving the authority with no reserves in 2017/18.
“This is a long-awaited, excellent report,” he told members.
“In June 2010 we were right into the mire, and right up to the neck. I had to sit in this building and answer some very difficult questions.
“We’ve heard today that we have moved forward steadily over the past four years.
“To read [the report] … it’s music to my ears, but we still have a long way to go.
“We still have to take very difficult decisions and stick to the medium term financial plan. But without the excellent work done by Mr Gray we maybe wouldn’t be where we are today.”