Work is to begin in earnest next week to transform the way Shetland Islands Council plans and manages its spending. Overhauling the ingrained culture of the high-spending local authority was one of the pledges made by new chief executive David Clark on taking up his post last month.
He hopes to prevent time and money being wasted on projects which fail to come to fruition or balloon in costs, such as happened with the Bressay bridge and Anderson High School.
Senior council staff members have been summoned to a two-day session next week to debate a new approach to capital spending. In future Mr Clark hopes the SIC will agree and stick to a realistic five-year plan, concentrating on viable developments while those not viable will be dropped or shelved.
He is keen for staff to exercise “good sound judgement”. He told the media at his weekly briefing on Tuesday: “The whole thrust of the two days is to get the management team exercising their intellect, their judgement, their experience and having the confidence to start taking decisions and prioritising.”
The new chief executive considers it crucial to break the year-to-year spending and planning approach that the authority has sometimes resorted to. “I’m determined that we will have a viable five-year programme produced. Ultimately we want it to be longer but a five-year one is a step forward.”
He wants the management team to prioritise spending using three categories: high, medium and low priority. The lowest ones will be shelved to enable the authority to concentrate on delivering the others.
“What I want to get in the team is the confidence to start challenging assumptions; to start challenging arbitrary sums; to start taking decisions.”
The intention from next week’s summit is to emerge with a draft plan from the leadership team to be honed and refined and put before councillors for their thoughts.
It has been known for years that the council had to slash spending to avoid using up its reserves in the coming years. Yet it now seems that the crisis is not as acute as previously feared. Substantial extra money has been found from savings, underspends and investments, the details of which will be revealed soon.
Mr Clark was reluctant to go into detail this week before councillors are appraised of the position but he said: “Our finances would appear to be in a better state than I think was previously envisaged they would be at this time.
“The figures coming in through the finance department are showing a picture that makes us confident we are going to be able to come up with a complete programme for the council that I think will be able to deliver all that needs to be delivered.”
The threat of the single status pay deal derailing council spending plans has lifted after a £7.3 million underspend was found in the council’s budget from last year, as reported last month. Finance head Graham Johnston is due to tell councillors in the next few weeks how the money will help them out of their budgeting difficulties.
One area where the gravy train looks set to be derailed is in the perceived over-charging of the SIC by outside consultants and the providers of all kinds of goods and services. Mr Clark is determined to stop businesses essentially taking the council for a very expensive ride.
While in the past the council had the money to do as it wanted Mr Clark said changing financial circumstances demanded a different way of looking at spending rather than the Rolls-Royce solutions which the SIC has become known for.
“We are going to have to tighten our belt a little bit and maybe be just a little bit more thoughtful in how we prioritise the works and the way in which we deliver them. [Buildings] don’t always have to be brand new. Sometimes you can extend lives or come up with different value-engineering solutions to give a bit more time.”
Although the SIC has been unfamiliar with being restricted in its spending Mr Clark said it still faces nothing like the constraints on other local authorities. “Every other council has to go through this [efficiency] exercise with brutality on an annual basis. We’re going to have to go through the exercise but I don’t think it’s going to be as painful as perhaps some people worry about.”