Local Government Financial Overview November 2016 – podcast transcript 
I’m here with Ronnie Hinds, deputy chair of the Accounts Commission, to talk about a report, the Local Government Financial Overview.
Ronnie, can you tell me what this report is about…
Yes, it is a look at back at how Scotland’s 32 councils have performed financially over the last year and it’s mainly based on their annual accounts for 2015/16.
So what have you found?
Well, councils are generally doing a good job with their finances in difficult circumstances. Overall they remain within their budgets; they increased their reserves slightly and reduced their debt in 2015/16. 

But pressures continue to increase on a number of fronts. Each council has got its own particular challenges but all councils face financial shortfalls requiring further savings or the use of reserves. They need to change the way they work if they are going to make the savings needed with minimal impact on services.

What do you mean by increased pressures?

Well, we all know that demands on some key council services are increasing and have been increasing over recent years.  For example, we are all getting older and that brings increased pressure on social care. And councils also face increased costs in areas such as pension provision. 

Budgets have certainly tightened in recent years and that trend is likely to continue we think. The Scottish Government provides around 60 per cent of councils' total income and over the past six years, up to and including 2016/17, Scottish Government funding for councils fell by 8.4 per cent in real terms.

What does this mean for the public?

Well, what we are talking about here are key services that we all use every day – schools, roads, social care. So it really is important. 

What do you want to see happen next?

It's vital that councillors and council officers set medium and long-term priorities and make clear financial plans for the future based on these. They need to ensure services meet their particular priorities and are built on a solid financial foundation. And that will require some difficult choices.

The Commission wants to help councils in this process – that’s way we’ve published this financial overview now to give them some useful information and analysis before they consider their budgets for next year and entire into discussions with the Scottish Government over funding.

Ronnie, thank you very much.