An independent report highlights East Lothian Council’s strong governance of its finances while recognising ongoing challenges as demand for services grows.
Audit Scotland’s report into the council’s annual accounts concluded that “the council has appropriate budget setting and monitoring arrangements in place… and has sound governance arrangements in place for how it conducts its business”.
The body, which is independent of the local authority, also recognised the significant challenges to identify over £72 million of savings required in the next five years to balance its budget.
East Lothian Council’s own annual accounts 2024/25 pointed to the impacts of ongoing population growth in the county and resultant increase demand for services which “are not expected to be offset by a similar increase in taxpayer funding whether through local taxation or from Scottish Government resources.”
In February 2024, councillors agreed to adopt three new priorities to respond to these impacts:
- Ensure the financial sustainability of the council through the delivery of approved savings and transforming the way we deliver services
- Target resources on statutory services and focus on the highest risks and those most in need
- Deliver-key infrastructure, economic development and environmentally sustainable projects within available council resources and maximising external funding.
In its report - which was presented to Tuesday's full council meeting - Audit Scotland advised the “medium-term financial plans reflect the council’s strategic priorities”.
Council Leader Norman Hampshire said: “This independent assessment of our accounts offers reassurance that our finances are well-managed and monitored.
“Financial sustainability is a critical priority to ensure budgets are managed efficiently and effectively to meet statutory responsibilities and deliver on key priorities for communities.
“Our financial position remains extremely challenging as a direct result of increased demand for services without the necessary increase in funding to meet it. We have a clear strategy that enables investment where it is most needed while also changing the way we work to continue delivering the necessary savings.
“In the face of these challenges, our mid-year financial position reflects positively on the decisions we have taken.
“However, there is more to do. We still have a financial gap to close and without a realistic, fair and sustainable funding from central government, which provides the majority of the money we need for our day-to-day budget.
“The in which we deliver services must change to ensure that we are prioritising resources available to support statutory services and wider priorities.
“In recent years, the council has continued to play its part in meeting national housing land allocations. While the resultant growth undoubtedly has the potential to realise benefits including regeneration and boosting local economies, the additional income from council tax does not fully cover the increased cost of delivering services to growing communities.
“That’s why it’s essential that we continue making the case to national governments for additional financial support in order to sustain quality local services and make sure we are well positioned to maximise opportunities such as regeneration and job creation.”
The reports presented to Tuesday's council meeting can be found on our website.