Highland Council has clawed back a massive budget overspend by £3million in four months.
The local authority was facing a forecast £5.5m black hole by the end of the past financial year – but major austerity savings has seen this amount reduced dramatically to just over £2m.
The greatly improved financial position is to be reported to the council’s corporate resources committee next week.
A Highland Council spokeswoman said the position reflects the overspend reducing by £3m “due to management actions in recent months”.
Budget leader councillor Alister Mackinnon, the chairman of the corporate resources committee, said: “The final outturn for the year is an overspend of £2.28m.
“This reflects a substantial improvement from the forecasted overspend at end of quarter three of £5.55m.
“This is around £3m better than anticipated a few months ago.”
He added: “This more positive position demonstrates the steps taken at an early stage to address and correct what was a worsening position at the time.
“Strong governance, vacancy management and expenditure controls have not been easy, but have been essential to bring us back into a more stable position.
“I want to thank all staff for their help with delivering this result.”
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The councillor said: “We will need to keep on top of this as there will be further risks and challenges in the year ahead.
“We will be continuing to monitor the budget on a weekly basis and I am confident that we have the right processes in place to deliver the 2019-20 budget.”
The net spend on services for the year 2018-19 totalled £559.254m.
The impact of the deficit has been mostly offset by a review of earmarked reserves and net income.
A report to next week’s committee state: “Overall a year-end deficit of £2.28m requires to be funded from the council’s non-earmarked general fund reserve.”
As part of the austerity savings plan, Highland Council is to appoint an “agency hire tsar” to prevent managers from clocking up massive agency hire bills.
The agency co-ordinator will oversee, monitor and check the recruitment of agency staff to try to bring down the council’s multi-million-pound bill for temporary workers.
The council clocked up 4,200 temporary contracts in 2018/19 at a cost of £3.4 million. Recruitment agency Global Highland took the lion’s share of this, at more than £2m.
