dave watson speechDave Watson, UNISON Scotland’s Head of Policy and Public Affairs, takes a calm look at the reality of likely job losses resulting from the Scottish Government’s cuts to council grants. This article was first published on Dave’s blog.

 

In recent days there have been many political exchanges over job losses as a consequence of the cuts to council grant allocations in the Scottish Budget for 2016/17. Let’s look at the issue calmly.

John Swinney’s view is that job losses have been “utterly exaggerated”. Christina McKelvie MSP says, “But there are not 1,000s losing jobs, that’s just made up”.

The most widely quoted estimate for job losses is 15,000. This figure doesn’t come from the trade unions; it comes from COSLA. They do, after all, have access to most of the councils and their senior officials that actually have to deliver the cuts. I am not a party to their calculations, but it is clear that they are based on the consequences of both the grant allocation cut and the additional unavoidable commitments councils have to finance next year.

What we do know for certain is the combined General Resource Grant + Non-Domestic Rates Income figure, which is used to calculate local government’s total revenue settlement, falls by 5.2%, or more than £500 million, in real terms (the equivalent figure in cash terms is a reduction of 3.6%, or £349m). We don’t know the sum total of the additional commitments, although the largest element is likely to be the increase in National Insurance contributions that COSLA estimates at £125m. That alone takes the cash cut to £474m, but in practice it will be much higher when you take account of other service pressures.

If we look back historically, SPICe calculates that the local government budget fell by 6% between 2008/9 and 2015/16. We also know that local government employment during that period fell from 314000 to 244,800 (latest figure). Allowing for police and fire transfers that means at 42,400 jobs were lost during that period. We generally round that figure down to 40,000.

It isn’t a linear calculation to say a 6% cut equals 40,000 job losses, but it does give you an idea of the scale of the employment challenge when councils are facing at least a 5.2% cut in the coming financial year.

The reason no one can give a precise figure is because councils will use a variety of measures to make the cuts. Some will use reserves or other financial instruments to mitigate some of the cuts. Some service cuts are more staff intensive than others, although council services by their nature are staff intensive. The proportion of the budget that constitutes staff costs depends on how you calculate total expenditure, but a rough figure for most councils would be around 60%.

From local budget consultations that have taken place, we do have some idea of job losses. Several councils have provided estimates although they should be used with caution given that they depend on negotiations and other savings assumptions, including cuts in terms and conditions. However, some 8000 job losses have been identified so far and we expect that number to grow as budgets are finalised.

So, are the job loss estimates ‘utterly exaggerated’. Historical precedent would say they are not. At best you could say they might be less than 15,000. Our more optimistic estimate has been 10-12,000 and those may not all be implemented the coming financial year. Our estimates have proved to be fairly accurate in the past, but there are too many variables at present to be sure. We can be pretty certain that the number will be many thousands – so I’m afraid Christina McKelvie needs a reality check.

The bottom line is this. If anyone can explain how you can cut over £600m from council budgets, when 60% of spending goes on staffing, without job losses – then I would love to hear from them. Our local government members across Scotland would be delighted to see that magic trick.

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31 thoughts on “Job losses and the Scottish budget

  1. This figure doesn’t come from the trade unions; it comes from COSLA

    a Labour Council controlled organisation that acts as a Labour mouthpiece and is instrumental in deliberate sabotage of Scottish Government initiatives….cutting budgets and teachers since 2008 despite promising not to

    it isn’t a linear calculation to say a 6% cut equals 40,000 job losses, but it does give you
    a chance to make spurious accusations based on flawed maths

    Since 2010 the Scottish Governments budget has been cut by 10% so

    SPICe calculates that the local government budget fell by 6% between 2008/9 and 2015/16.
    shows that the Scottish government has meade good effort in protecting Local authorities from the slash and burn cuts imposed since the financial collapse…..

    or should Labour Councils be immune from the cuts that every other authority in the UK is suffering under?

    Since English councils are half way through a 40% reduction in their funding….labour councils are ahead of the game

    ” If anyone can explain how you can cut over £600m from council budgets, ” ah the usual Labourithmetic rears it head again…..

    think of a number…make it bigger or smaller depending on your political needs…..convert it to a different unit and inflate it again….and hope no-one notices

  2. It is obvious from this article that Dave Watson likes numbers and statistics, so here are a couple of numbers Mr Watson might like to check the reality of; UK borrowing is running at about 75 billion per annum or 1.5 thousand million per week. This is half what it was under the last Labour government. So in 5 1/2 years of Tory ‘austerity’ George Osborne has only managed to reduce UK borrowing by half, and that also means that UK debt at 1.4 trillion or 1,500 billion is still growing. Another statistic Mr Watson may like to check the reality of is the ratio of private sector workers to those employed in the public sector (Unison members). In Glasgow for example, for every 2 workers in the private sector there is one public sector worker. This is unsustainable.
    May I suggest that the next time Mr Watson feels inclined to lecture us on cuts to public spending he reflects on the present state of the countrys finances.

      1. Em the reality of the UK debt has it closer to 5.5 trillion than 1.5 trillion.

        it’s more than that Mike…..

        ONS reported the pensions liability alone was £5tn in 2010…..

        1. Kind of destroys the claims that an rUK would be able to afford to shun a currency union with an Indy Scotland. Cant see them going it alone with a multi trillion pound deficit from day 1 while Scotland starts off debt free.

      2. And that article was written in 2011. What ever the actual figure is for UK debt it puts union leaders banging on about budget cuts in perspective.

  3. If only Scotland could find a “money tree”, something like a huge oil field—oh wait.

    No Scottish Labour INSISTED that money didn’t belong to Scotland. So London and the SE got huge social and industrial infrastructure spends,Of tens of billions of pounds, while Scotland had to guddle its finances to afford a new bridge. You can check out the National Infrastructure Plan for where all the investment went—it sure wasnt Scotland !
    The DoI also had huge incentives for motor companies to set up in England to replace their decrepit indigenous car industry. Scotland got screwdriver assembly plants—in direct competition with low wage economies.
    I worked in the last two deep mines in East Ayrshire—when they shut the Tories did nothing to reindustrialise the area, but then neither did Labour when they got in.
    Foulkes got to be a Lord—anyone know why?

    Now we are told by a gloating Brit Nat establishment (Brit Nat politicians and their tame media), that Scotland after 45 years of oil revenues flowing south is BANKRUPT.
    Well ,how about that, Mr Watson.

  4. Dave stay calm and please enjoy my next trick of sweeping through the councils ways of working with a witches broom 1. Hey presto completely restructure all elements of the council frontline and management systems with a view to implement new ways of working and efficiencies savings. 2. Reduce management positions by at least 60% at the moment there is to many managers and not enough frontline staff. 3. Cut all council funding for trade union representatives in the workplace and use the money for council services. 4. Trade union representatives in the workplace should be monitored by Human Resources and they should have to get prior permission and also keep a log of the time they are off duty from their substantive post whilst on union duties. 5. All full time trade union officers in the workplace should get their wages paid by their union and not by the council using the council taxpayers funds.

  5. All good cybernat stuff so far. The reality is that the SNP government has been rumbled for what they are – long on populist rhetoric but short on actual measures to protect public services. FYI – only 2 out of 32 councils are majority Labour, most are coalitions, many including the SNP, eg Edinburgh.
    There is no doubt that Swinney’s cuts will have severe effects on communities across Scotland, so get real and try to understand what is really happening.

    1. Labours idea of protecting public services is to privatise them.

      Swinney isn’t cutting anything he is passing down cuts that were made at Westminster with the full cooperation of Labour.

      This need to self deny and deceive is all well and good but don’t go believing its contagious.

    2. “The reality is that the SNP government has been rumbled for what they are”

      Dave how does rumbled for what they are make sense with the polls predicting a 1st place SNP majority with your sister party the Blue Tories coming 2nd and the Scottish labour section Red Tories come 3rd behind them it seems to me that it’s a case of the usual default position of SNP Bad Bad Bad hope you get over it after the elections.

  6. When we were the ‘Workshop of the World’ there were plenty of jobs. That was because we were more efficient at producing stuff than everybody else. Now we are extremely inefficient in all the sections of the Free Market that can support lots of jobs and reasonably wages, yet our political parties all claim that they are going to ‘grow the economy’ . Anybody who keeps abreast of reality in the shape of Max Keiser, Gerald Celente etc.knows this to be ‘bullshit’

    We are told to stop digging when we get ourselves into a hole. Obviously much the same goes for competition ; if people don’t want the stuff we produce then we should stop producing for foreigners, and concentrate on providing for ourselves.

    Lets start with clay mines, brickworks, plantings, sawmills, apprentice brickies,plumbers, electricians etc. Then we could grow our own food on our land that is at present so sadly unproductive. In the meantime we could build hospitals and homes in all our communities and teach our selves the skills to man them. All this could be achieved on a 20 hour week maximum as long as we first of all take over ‘OUR’ the banks and so stop paying interest.

    If you think this a load of shit, go google ‘Money is Credit’ , ‘Modern Banking’ etc..

  7. Osborne already promising further cuts, on top of cuts still to come.
    What will Labours solution be?
    More and more tax rises in Scotland.
    To keep featherbedded councils in fancy new buildings, and trades union bosses getting paid out the public purse for doing zilch.
    Next time they stage a “demonstration” at Holyrood, perhaps a journalist could ask if they are being paid by the public or by the Labour party.
    Its obvious some councils use the education budget as a convenient “bank” to fund other stuff—-time they lost education all together.

  8. Amazing. The same people who have been gurning about austerity and pretending to be socialists now say the cuts are not that bad and that “efficiencies” can always be found. The truth is that they’ve been found out.

    All talk, but no action.

    All style, but no content.

    Strip out the selfies and flag waving, and there isn’t much left other than George Osbourne wrapped in a saltire. Sturgeon even dresses like Thatcher! 😉

    1. If only there was something we could have done to eliminate the Tories and their austerity for ever …

    2. “Strip out the selfies and flag waving, and there isn’t much left other than George Osbourne wrapped in a saltire. Sturgeon even dresses like Thatcher!”

      Grand Oracle and Soothsayer of Scotland when you mentioned selfies are you taking about ones similar to those below in particular the one of the Scottish Labour section Ex MPs read the article and see the first link below this is followed by a further six links of your illustrious leader Kezia Dugdales selfies I hope you enjoy them anyway what’s up with selfies maybe you should try to get one with Kezia as leader because if the polls predictions are correct and the Tories come 2nd in the Scottish elections then Kezia will have to resign. It’s sad that you have to attack Nicola Sturgeon dress sense that shows that you are resorting to personal attacks as you cannot win the arguments of the politics thats what it’s come down to you have shown yourself up.

      Tom Greatrex MP has been nominated for a national political award – for posting a ‘selfie’ on Twitter.

      The Rutherglen and Hamilton West MP has been shortlisted in the Selfie of the Year category at this year Political Twitter Awards.

      Judges were impressed with his snap taken in his garden as he headed off for his first shift as a ‘Clydesider’ at the Commonwealth Games on July 24, last year.

      He tweeted it with the message: “Not quite got hang of selfie – first may be last. Blue skies above as head to first #clydesider shift #Glasgow2014.”

      Tom will be up against some stiff competition, with the other nominees being Prime Minister David Cameron, Deputy Prime Minister Nick Clegg, Education Secretary Michael Gove, Labour leader Ed Miliband and Shadow Chancellor Ed Balls.

      But Tom doesn’t fancy his chances of picking up the gong.

      http://www.dailyrecord.co.uk/news/local-news/rutherglen-hamilton-west-mp-tom-5223002#EZhf0UxMWrXCQca8.97

      https://twitter.com/kdugdalemsp/status/459685761538068480
      https://mobile.twitter.com/kdugdalemsp/status/574187836070625280
      https://mobile.twitter.com/kdugdalemsp/status/579993946211934208
      https://mobile.twitter.com/kdugdalemsp/status/579992901838626818
      https://mobile.twitter.com/kdugdalemsp/status/565156681387352064
      https://mobile.twitter.com/kdugdalemsp/status/567357242962624512

        1. ” There’s nothing wrong with selfies?”

          Grand Oracle and Soothsayer of Scotland there is if you take one as your ugly mug might crack the screen (joke) any chance of you using you universal powers to let me know if the reported unexplained meteor seen in the skies over Scotland on Monday night see the link below mean anything I have to 2 theories what it might mean. 1. It is a sign of Scotland’s Independence and the end of the union. or 2. The Scottish Labour section getting beat by the Tories in the Scottish elections and Kezia resigning. Can you enlighten me and let me know which one is correct or may both of them be correct a double whammy.

          http://www.bbc.co.uk/news/uk-scotland-north-east-orkney-shetland-35689551

  9. Surely you can cut the wage bill of a local authority without losing jobs by reducing salaries across the board. You could even make it fair by reducing higher salaries more than lower salaries, thus protecting lower paid workers. Just saying. But maybe I’ve missed the point and protecting highly paid council workers is more important.

    1. Councils have already been stripped to the bone. Haven’t you noticed it’s SNP councillors saying this too?

      “A revenue cut of this scale would be very damaging for jobs and services within Scottish local government generally, and here in Edinburgh specifically – the harsh reality is that this will translate to real job cuts that hit real families, in real communities throughout our capital city. Everyone will be hurt by this.”

      Those are the words of SNP councillor and deputy leader of Edinburgh City Council, Sandy Howat. Are you going to accuse him of wanting to protect highly paid council workers too? Wake up and smell the SNP austerity.

      1. If there needs to be any cuts to jobs it is because of the financial arrangement between Westminster and Scotland then it is the fault of unionists like you Duncan and your cohorts that even when there was talk by the Tories of devolving more powers to Scotland you and your party opposed them because you are living in the past dreaming of preserving a mythological entity that no longer exists that was called the union. The harsh reality of your actions of standing shoulder to shoulder with the Tories in the Better Together campaign is one act of betrayal that the folks of Scotland will never forget and together with the failure to deliver even more powers to reflect the the SNP mandate given by the folks of Scotland in the general election will result in the Scottish Labour section recieving it’s worst result in the history of the Scottish elections and extinction.

        1. I campaigned against the Tories last year. They won a democratic election. I campaigned against the SNP in 2011 too. They won a democratic election. We have to accept that both governments have a mandate to do what they said they’d do in their manifestos.

          But here’s where the story becomes puzzling. The Tories said they would slash public spending, and they are doing it. The SNP, on the other hand, said they would oppose austerity. But they just chose to set the Scottish Rate of Income Tax to match the austerity cuts level set by George Osborne. Why? People voted SNP on the basis of their promise to make different choices. The Scottish Parliament has the power to make those different choices. Ask yourself why the SNP are choosing not to use those powers.

          The answer is simple. They want useful idiots like yourself to keep parroting the line that the Tories are responsible for cuts, not them. But anyone paying attention knows that they had the opportunity to do something different to the Tories, and they chose not to.

          The UK voted Tory and is getting what it voted for. Scotland voted SNP but is not getting what they promised. When are you going to start getting angry?

          1. “When are you going to start getting angry?”

            Duncan I prefer to keep calm and have a clear head to consider my views and position on political matters unlike yourself, I can feel your pain and emphasise and try my very best to understand the frustration and pent up anger you feel from being inside a party that has surrendered and admitted defeat even before a vote has been cast, that aside you cannot blame the SNP for job cuts as it is most of the Labour controlled councils who make unecessary cuts for political gains that is why the folks of Scotland will finish them off at the Scottish elections.

      2. I’m pretty sure he was referring to the austerity being passed down from Westminster. The Austerity Labour voted for remember?

        Of course you do.

      3. “The Tories said they would slash public spending, and they are doing it. The SNP, on the other hand, said they would oppose austerity. But they just chose to set the Scottish Rate of Income Tax to match the austerity cuts level set by George Osborne.”

        The SNP didn’t set the tax rate to anything. It hasn’t shifted. The only way taxation will affect the level of austerity is if you increase it without increasing income which is Labours proposal.

        How many times do I have to keep reminding you of the truth? Too party politically corrupt to accept reality not dictated to you by the Labour leadership.

        Not only would Labour increase taxation they would also cut services. How do we know this? Because that’s what they’ve done every single time they’ve gained power.

        So increasing taxation under Labour doesn’t see services protected or even saved in sees them privatised.

        1. “The SNP didn’t set the tax rate to anything.”

          On the contrary. If you took even the briefest amount of time to find out what’s actually happening in the real world, you’d know that under the terms of the Scotland Act 2012 the Scottish Parliament has to set a Scottish Rate of Income Tax. It’s not a responsibility that can be ducked. Setting it to 10p to match Osborne was the SNP’s active choice.

          As for your lies about Labour they are pathetic. Labour in power invested in public services. They doubled investment in the NHS. They improved waiting times, they cut poverty, they delivered across a whole range of public services.

          Your criticisms are almost never based in reality Mike. Why is it you think anyone should ever pay attention to them?

          1. “Your criticisms are almost never based in reality Mike. Why is it you think anyone should ever pay attention to them?”

            Duncan very unfair on Mike I find his comments to be well informed objective and based on facts unlike your comments that are by on large mainly subjective and based on dreams that I am sorry to say will become a nightmare for you post the Scottish elections. Duncan please indulge me you are dreaming the Scottish election results come in its worst than you though it’s a disaster a total wipeout Kezia resigns you shed a tear at her departure still in deep sleep you feel relaxed you see a stage a crowed are waiting the atmosphere is electric the MC announces comrades please welcome on stage the new leader of the Scottish Labour section the one and only Duncan Hothersall then you waken up in a cold sweat murmuring to youself what a nightmare how’s about that.

          2. The SNP’s active choice was not to tamper with the income tax rate Duncan so like I said they didn’t set it at anything they left it alone.

            During Labour abysmal failure in office they not only increased taxation they reduced services not only by cutting them but also privatising them.

            You deny reality again because you’re nothing but corrupt. Your ridiculous bare faced lying is only leaving you with no credibility at all.

          3. They set it at 10p. Your policy of simply denying reality when it suits you is not a very persuasive one.

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