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Aberdeen council finances subject to Accounts Commission inquiry

Wednesday 28th May 2008
Marischal college, Aberdeen Courtesy: http://www.e-architect.co.uk/aberdeen

Aberdeen City leaders have been at the centre of controversy over spending plans that will result in them cutting £27m from budgets. Spending watchdog the Accounts Commission for Scotland launched an inquiry mid May over concerns raised in the city council's recent Best Value Audit and Community Planning Report.Its purpose was to assess how well the local authority was performing and what improvements had been made, but instead it identified "serious weaknesses in governance and accountability".

The hearing, held in the city's historic Town House, took evidence from the council's chief executive, Douglas Paterson, leader Kate Dean and deputy leader Kevin Stewart. Local organisations presented a damning dossier of negligence and mismanagement claims against them.

This revealed low staff morale, incompetence, illegality, recklessness, bullying, lack of rigour and a disturbing willingness to take a gamble with council taxpayers' cash.It also emerged that the council was planning to defy the Scottish Government by retaining class sizes at their legal maximum, despite ministers' moves to reduce the maximum numbers of children to 18 per class in early primary school.

As the home port for the North Sea oil industry, Scotland's third largest city has seen its wealth grow in the past 30 years, with low unemployment levels and little poverty. But, as in any city, there are those who slip through the net into addiction and destitution.  Vulnerable Aberdonians are now experiencing further suffering, as a result of  years of overspending by a local authority.

Aberdeen City Council's £50m overspend between 2002-2007 led to the Accounts Commission probe and drastic cuts that will affect the whole city.

• The education budget has been cut by £2.5m. Around 5% of staff are to be shed from schools. Some headteachers claim they will be forced to reduce teaching hours so will introduce more study periods for fifth and sixth year pupils.

• The £880,000 cut from the Aberdeen Cyrenians budget will hit the estimated 2,500 homeless people in the city.

• The city's oldest swimming pool was closed last month. The 68-year-old art deco Bon Accord Baths was subsidised to the tune of £842,000.

• The city's only ice rink is to be closed for 18 months to save cash. The Linx Ice Arena will undergo a £1m revamp before it will open again.

• The city's Choices Day Centre which provides respite to dozens of disabled will close on June 2 because the council called a halt to its funding. Many of its users are people with learning difficulties who are terminally ill.

• The future of around 56 blind or disabled workers at the Glencraft furniture factory in Aberdeen is also under threat with the withdrawal of £650,000 of annual subsidy.

The local authority's plans go much further than withdrawing funds from local charities, however. Several schools in the city and are to close or merge, and parent groups insist larger class numbers will have a detrimental effect on children's education.

The Federation of Small Businesses in Scotland fears the cuts will affect a large number of businesses in the city, leaving a "bad flavour" in the mouths of those trying to work through the problems. Aberdeen branch chairman Andy Willox warns: "The business community as a whole is upset. We're ambassadors for the city – the cuts are not good news for the business sector.

"The closure of services will have a disastrous knock-on effect on many small businesses trying to make a living. The closures will cut back the work of contractors such as plumbers, and computer maintenance firms – everyone is affected.

Paterson quit his post before he was grilled over claims of mismanagement at the Audit Commission hearing on Tuesday. His announcement that he would retire a year early followed calls from the public for him to step down. The 58-year-old had been head of the council for 12 years, in charge of more than 11,500 staff and an annual budget of £350m, before his leadership skills were called into question. He introduced radical new structures with the aim of improving on citizen care as well as encouraging local residents to become more involved in their community.

Paterson was forced to publicly explain why around £11m of the city's reserve kitty had been squandered trying to keep services afloat. There was little he could say to explain the council's errors, but conceded that he had trusted the judgments of his management team, who further embroiled the local authority in controversy when it emerged they had sold off council properties at below market value.

Audit Scotland investigated six controversial property transactions between 2001 and 2007, including the disposal of Carden House, the Seafield Club and a multi-storey car park behind Union Street. It concluded the council should have achieved far better prices.

Willox said, "The council has to get its finances in order, for everyone's sake. It's a case of learning lessons and going to all lengths to make sure this does not happen again. As of yet, the public has very little idea of what went wrong but we're just hopeful this inquiry will get to the bottom of it."

Source: http://tinyurl.com/48m7a5

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