A year of challenge and opportunity, says convener
A year of challenge and opportunity lies ahead, according to SIC convener Malcolm Bell.
“In the first half of this council we have laid and built very strong foundations,” he told The Shetland Times.
“We have now got to build on those and with the communities create a Shetland that we can all be proud of.”
The council has set a sustainable budget for the first time since 1997, and is bringing its reserves fund withdrawals down to a more suitable level.
“Whilst I would strongly disagree with anyone who would suggest that we were euphoric about achieving that [a sustainable budget] it was nonetheless a serious achievement for this council,” said Mr Bell.
“Given that when we came in after the election in 2012, the council was overspending by somewhere in the region of £36 million a year, which is roughly about 33 per cent, a massive amount.”
Over the course of the two-and-a-half years since then, officers and members had worked really hard to bring spending into a sustainable position, he said.
If reserves were maintained at their current level of £200 million, the interest and investment return from the reserves provides the council with about £10 million a year extra to spend on services, he said.
Had the council been able to maintain its reserves at the year 2000 level, when they were worth somewhere in the region of half a billion pounds, that would have equated to an extra £25 million a year available to the SIC.
Mr Bell said: “I want my children and my grandchildren to benefit in the same way as I benefited from Shetland’s oil era. The only way we can do that is to maintain the reserves and to draw sustainably from them.”
The council was not complacent though, “this is not the end of the story, it’s only the end of the beginning,” said Mr Bell. The convener later warned about the challenges of the ageing population – with demographic changes altering at a steeper rate than average in the UK meaning Shetland would proportionately have a greater number of old folk.
“We’ve only got ourselves back on the same playing field as every other council. It’s clear that government grants to councils will continue to reduce at least until the early 2020s so we will continue to have difficult decisions.”
Earlier this month, the council appointed Steve Whyte, head of Aberdeen City Council’s finance department. He is the replacement for finance chief James Gray, who was praised by Mr Bell for his work in turning around the council’s finances.
Mr Whyte is to share his time between the two authorities, providing financial leadership to both.
Asked if such an appointment was a risk, Mr Bell said: “In the recruitment world there’s no decision that doesn’t have a risk. So even if we had gone down the the conventional route there would’ve been a risk attached to it…
“We feel this is an innovative appointment. In many respects we are going to have to see how it goes, both councils will have to see how it goes, but we believe that Aberdeen have skills and experiences that we might be able to tap into. We have skills in areas that they don’t have for example managing our reserve fund. So it should be of mutual benefit.”
Councils were going to have to look at different ways of providing services, he said because of reductions in council funding.
“In an effort to maintain frontline services to the public, we will have to look at different ways of providing essential backroom services,” said Mr Bell.
With the ongoing Our Islands Our Future campaign, the independence referendum and the Smith Commission on devolution reporting this year, Shetland’s share of power and wealth had been in the spotlight.
Scotland, he said, was one of the “most centralised countries in Europe”.
Mr Bell added: “We have the fewest number of local authorities and the largest local authorities anywhere in Western Europe.
“We’ve always argued that here in Shetland we’re different, we’re different culturally, we’re different geographically and it’s right and proper that we should be able to have the freedom to find local solutions to local problems.
“So I very much hope during this year  we will see the work of Our Islands Our Future bear fruit.
“The proof in the Smith Commission pudding will be not in how many powers go to Holyrood but how many powers come from Holyrood out to local authorities.”
Mr Bell also spoke about the issue of the council tax freeze.
“We have had council tax frozen now since 2007.
“I’m not saying that raising the council tax is necessarily a good thing or a bad thing but at least if we had the ability to do it would could say to the public ‘we can do this but it will cost x per cent on council tax’.
“That would be a legitimate question that we could ask but at the moment we don’t have the power to ask that question.
“I think it’s vital that some of the powers and the influence that local government used to have is returned, regardless of the Smith Commission.”
Mr Bell said he was very interested in the concept of “one community”.
“We are much too small to splinter into micro-communities. We are one Shetland, there’s no-one else who’s going to ride in and rescue us, we’ve got to do it together and to make the best use of resources we have and have been given.”