£5m savings have no affect on services, says council

Sep 15 2009 by Les Stewart, Perthshire Advertiser Tuesday

PERTH and Kinross Council has made efficiency savings of more than £5 million in the first two years of a three-year spending review period.

And there is “no evidence” to suggest that the efficiency gains have led to a reduction in performance or service quality.

Details of the savings are contained in a report by the council’s head of finance, John Symon, to a meeting of the strategic policy and resources committee tomorrow.

The Scottish Government has set public sector efficiency targets of two per cent. each year for the three financial years from 2008/09 to 2010/11.

“All efficiency measures counted against these targets are meant to be ‘cash-releasing’ in that they are intended to generate cash savings or allow for a greater volume of service delivery, with no increase in cost,” explains Mr Symon, in a report to the meeting.

“Perth and Kinross Council is committed to making the best use of public resources and the identification of cash-releasing efficiency gains has formed a key element of the council’s financial management strategy.”

During 2006/07-2007/08, the council identified cash-releasing efficiency gains totalling approximately £5.4 million, which has been re-invested in supporting service delivery.

During the same two-year period, they also identified ‘time-releasing’ efficiency gains to the value of £2 million, which “reflects the improved use of council services,” according to the finance chief.

The key areas of efficiency gains in 2008/09 were in asset management , procurement and workforce planning.

The council also targeted other areas – investment by the council in recycling and other waste management initiatives in the last financial year generated efficiency gains of £500,000.

“Further savings of approximately £877,000 a year for the next five years were generated through proactive Treasury Management by replacing existing loans with new borrowing at more favourable interest rates,” adds Mr Symon.

The council also “anticipates” delivering further efficiencies in 2009/10 and beyond from streamlining its procurement practices.

Mr Symon states: “The realisation of efficiency gains through workforce planning and asset management planning will continue to form cornerstones of the council’s efficiency strategy.”