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Somerset considers staff taking unpaid leave amid audit warning

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Somerset CC has floated the idea of asking staff to take unpaid leave over the next two Christmas holidays in a bid to save £1m, according to Unite, as auditors warn the county could run out of money within three years.

The union said it plans to oppose the council’s proposal to ask its workforce to take two days unpaid leave in each of the next two years, with Unite’s acting regional secretary for the south west Steve Preddy calling the “mean-minded move” a “step too far”.

A Somerset spokeswoman said: “Staff have not been asked to take two days unpaid leave, however we are in dialogue with unions to achieve a saving and have suggested two days unpaid leave over the Christmas period as a temporary two year measure to meet that target.”

This comes after Grant Thornton issued a stark warning about the state of Somerset’s finances. LGC reported in May how Somerset was warned in a Local Government Association corporate peer review that it had only sufficient resources to balance its budget for one more year beyond 2018-19 if overspending continued and it did not get a “grip” on expenditure.

In its report on the council’s 2017-18 statement of accounts, Grant Thornton said it was planning to issue a qualified ‘adverse’ value for money conclusion as it had decided Somerset “does not have proper arrangements to secure economy, efficiency and effectiveness in its use of resources”.

Grant Thornton said Somerset’s “financial health has deteriorated over the last 12 months due to continued overspending, predominantly in the area of children and families”.

The report added: “This has necessitated further use of already depleted reserves that now means the council has limited capacity to fund any further overspending.

“The inability of the council to deliver against its budget is now pervasive to the whole council and without urgent actions could result in it running out of money in the next two to three years.

“Further effort is now required to ensure budgets are delivered and the council repositions itself on a sustainable financial footing.”

On the issue of overspending in children and families services, Grant Thornton said it was “unclear” if the problem was “an unrealistic initial budget or poor in year financial management or a combination of both”.

In contrast, however, Somerset’s management of its adults and health budget last year was “a resounding success” with previous overspending issues being addressed and the service area eventually reporting an underspend.

“It was noted from conversations with management that a key component in this recovery has been a much tighter control of expenditure with approvals required at all levels before that expenditure can be incurred,” Grant Thornton’s report said.

The auditor’s review of Somerset’s finances from last year overall found “only £11.1m (57%) of the budgeted £19.5m of savings were delivered”.

LGC reported in June how a report by South West Audit Partnership (SWAP) said Somerset was “failing to meet savings targets” despite a revised approach to the way it manages its finances.

Grant Thornton noted how Somerset had started to take “a number of steps to begin to address” its budget pressures “and that financial scrutiny” is now central to the way the council functions.

A spokesperson for Somerset said: “The audit report reinforces the financial position we identified earlier in the year, what we were told in our peer review and the accepted need to address overspending. We do face a significant a financial challenge but it’s one we understand and are already taking action on.

“Living within our means and delivering the best possible services within our reduced budget is our priority. These pressures aren’t new - in the last seven or so years we have made around £130m in savings and efficiencies, while improving performance in many areas, especially in children’s and adults services.

“Austerity is a big challenge for local government, especially for councils with responsibility for vulnerable adults and children – which account for two-thirds of our budget – and we continue to lobby government for fairer funding.”

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Readers' comments (2)

  • Why not offer the unpaid element of the closedown as being optional, with the salary deduction spread over a few months.

    Those who can't afford it therefore don't have it imposed on them, and those who can afford the unpaid break, could have the deduction taken over a few months to make it even easier.

    If all the senior managers were to set a clear and public example in doing themselves, I am sure many others would follow.

    Do not necessarily have to limit this to Christmas, unpaid could be promoted during other times of low demand, but again I'd say it requires drive and an example being set by the senior managers for it to make the savings required.

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  • There are already councils making all staff count, and take, 2 or more unpaid days as part of their annual working/holidays pattern. Buildings are closed, IT and other services don't run, life & limb services only are in work on a skeleton crew basis. I won't name any but I know of several.

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