The possibility that Dundee City Council may eventually have to consider compulsory redundancies to tackle budget cuts has been tentatively raised by a senior member of the SNP administration.
Councillor Willie Sawers, depute convener of the policy and resources committee, spoke on Friday night after it was confirmed the council will have to make an extra £10 million savings over the next three years.
That takes the total revenue budget cuts to £40 million, prompting the Labour group leader to say he feared that more than 10% of the council’s 7500 employees might be affected.
Asked about the potential impact on jobs, Mr Sawers said, “We have a voluntary redundancy/early retirement scheme. The deadline to apply is August 31 and the onus is on staff… to apply for voluntary redundancy.
“Let’s see what comes from it before we look at other alternatives. Clearly there is going to be a reduction in the number of staff working for the city council, but it is a voluntary process.”
The council has a long-running policy of avoiding compulsory redundancies and Mr Sawers reiterated that, saying, “The policy is to avoid compulsory redundancies at all costs.”
Referring to the current financial projections, he said, “At this point in time we are working together with staff and the trade unions and we do not foresee compulsory redundancies in the immediate future.”
Asked if that left the door open to consider compulsory redundancies later, he said, “Future funding settlements from the Westminster government have not been guaranteed.”
Even the vague possibility that compulsory redundancies could ultimately have to play some part in restoring the council’s financial equilibrium will undoubtedly spark concern among workers and trade unions.
Mr Sawers’ comments followed the release of a council report setting out the latest financial estimates. These show savings of just over £20 million will have to be made next year, with a similar sum taken out of the budget over the subsequent two years.
It is possible even greater savings will be needed, depending on Scottish Government decisions on public spending.
Unions representing employees had warned that 600 jobs out of around 7500 could go, but at that stage they were expecting £15 million cuts next year.
Labour group leader Kevin Keenan said he feared more than 10% of employees could now be affected.
He said, “Based on the trade union figures we were looking at around 600 jobs, but it’s now way beyond that 80% of the cuts will be wages. That is my view. That is money that will come directly out of the local economy. The impact is absolutely enormous.”
Opposition councillors were also worried about the potential impact on services and on the thousands of people across the city who rely on them.
A report has been prepared for councillors to debate later this month, but a series of questions put to the council on the likely impact of the crisis received only a single sentence in reply.
A spokesman said, “The report is the start of a process that will run through to the budget setting in February and we cannot pre-empt decisions that will be taken by elected members.”
Councillor Willie Sawers said he and his colleagues were committed to providing social work and education services. But the council spokesman was unable to say if that meant spending in those departments would be protected from the cuts or not.
Council chief executive David Dorward has prepared a report to be discussed at the August 23 meeting of the policy and resources committee. This sets out the full scale of the financial difficulties.
Savings of £20.2 million will have to be made in the 2011/12 financial year, with another £9.9 million to follow in 2012/13 and £9.1 million the year after that. The revenue budget is around £370 million per year.
But Mr Dorward has warned, “These projections are not based on a worst-case scenario. Should the Scottish Government decide to protect the health budget, the impact on other departments, including local government, is likely to be more severe and the level of savings required by the council could be greater.”
The report asks councillors to back a Changing for the Future programme, including setting up a board of senior officers and councillors to oversee the work.
Four key areas have been identified the voluntary redundancy scheme, a corporate improvement plan, work within council departments to try to find savings and efforts to collaborate more with neighbouring local authorities.
Mr Sawers insisted the SNP administration would be keeping to the council’s long-standing policy of no compulsory redundancies and there were no plans to increase council tax rates.
He added, “The financial squeeze imposed on us by the Westminster Government is unprecedented and the overall financial picture has worsened as the implications of UK budget cuts have become clearer.
“Finding this level of savings means taking some very tough decisions. We will have to work smarter and look to introducing new ways of delivering and modernising council services.
“We will also look at working more closely with our partners within and outwith the city to deliver even more efficient services.
“The chief executive is developing a strategy to look at prioritising and redesigning services in the most productive way, including shared services, arms-length companies, commissioning and outsourcing.”
He appealed to opposition councillors to engage positively with the process.
“Given the scale of the challenge facing us, I am hopeful the proposal for a new consensual and co-operative approach will be welcomed.
“In that light, the administration will welcome constructive suggestions from all councillors as to how to achieve the savings forced on us by the Westminster Government.”
Labour group leader Kevin Keenan was disappointed more information on where the “drastic” cuts would fall was not known.
“They have long known these cuts were coming and I would have expected they would now be in a position to tell us how they plan to reshape council services and… put that information out to the public,” he said.
“It is regrettable they are not at the stage to do that. I would have hoped for a bit more meat on the bones.”
It might be time to look at increasing council tax.
“These cuts will impact on individual lives in any case. I think the council tax is something the administration should be considering. I know it is unpopular but these cuts will also be unpopular.”
Independent Ian Borthwick, the city’s longest serving councillor, said “careful consideration” must be given to any cuts.
“Clearly, this is a very substantial amount that has to be cut from the budget.
“I have maintained right throughout this process that it is vitally important that elected members are fully appraised of the consequences of these cuts and the effect they will have on the families and communities we represent.”
Conservative group leader Rod Wallace gave a cautious welcome to some of the new measures in the report, but hit out at Mr Sawers’ comments on the Westminster Government.
“These cuts were mooted by John Swinney long before the coalition government in London,” he said. “It was always going to be a very painful process: we’ve known that from day one.”