Council urged to show more ambition in tackling financial pressure

A council should be more ambitious in how it tackles financial pressures, according to the auditor of local authorities in Scotland.

Inverclyde Council was found by the Accounts Commission to be impressive overall and improving in how it deals with issues like child poverty.

However, the council is still under financial pressure and facing a forthcoming funding gap.

The regulator said Inverclyde should be open to working with other councils to cut costs, while "digital transformation" should lead to savings.

The council was listed as facing a £7.6m budget gap for 2025/2026, with £3.4m of savings going towards reducing it.

A further £1.2m from reserves and another £3m via council tax rises made up the rest of the deficit.

The report stated that Inverclyde's "detailed, service level approach is working well", and resulting in almost all the planned annual savings being delivered.

However, it added: "Given the challenges identified in the financial strategy, the council's plans need to demonstrate more ambition.

"We would endorse the auditor's recommendation around the development of aligned medium-term savings plans."

Key to this will be digital modernisation and transformation, with the local authority saying in recent years it was seeking to modernise some services - like human resources or its complaints process - with digital upgrades.

The Accounts Commission noted: "The council's digital modernisation and transformation activities are embedded within wider plans and strategies, but rely on service staff with 'day jobs', creating capacity and delivery risks.

"Continued strong governance and oversight of digital and transformation work will remain essential as the council considers the projects now required to bridge identified budget gaps."

The report drew on data from audits of the council carried out in 2022/23, 2023/24 and 2024/25.

The report also noted the council has experienced challenges in delivering parts of its programme.

These included inflationary pressures, the availability of materials and labour, difficulty attracting bids for certain contracts, recruitment challenges within the council, and uncertainty on future funding levels from some council partners.

However the report found the council is performing strongly compared to many other local authorities, including those who do not face the same levels of deprivation as in Inverclyde - where council leader Stephen McCabe recently said there was a jobs crisis.

It said a multi-faceted approach adopted by Inverclyde, that involves communities in decisions about budgets and changes to services - such as public consultations and listening events - should be commended.

The report said: "Independent evaluation of specific projects to tackle child poverty shows services are more coordinated, shaped by community input, and are delivering improved outcomes."

Andrew Burns, the deputy chair of the Accounts Commission, praised the local authority for its work.

He said: "Inverclyde Council is impressive in many ways: it is focused on improving its citizens' outcomes and delivering high quality services, working hard to talk with and listen to its communities about the decisions it makes.

"It achieves this while dealing with some of the highest levels of deprivation in Scotland. Now the council needs to build on these strengths."

He added that this should be done by collaborating with other local government and public sector partners, and by being "more ambitious in its plans for tackling the financial pressures it faces."