Opposition councillors have warned Highland Council’s mounting financial problems could leave it battling to produce a £35million package of savings next year.
SNP group leader Maxine Smith issued the grim forecast amid fears that up to £8million of cuts agreed by councillors last year may not be achieved
And four months into a new minority Independent administration, there is still no indication of where the axe will have to fall.
The revenue budget for the current year is £570million, and every department will be affected.
The administration has delayed publication of its 2016-17 budget from November until February, despite pressure from the opposition to air a draft version before Christmas which could be adjusted once belated government cash settlements are known.
The local authority must save £46.3milion between 2016-19, with the bulk of savings – £21million – required next year.
Ms Smith, the authority’s former budget leader, said yesterday that the savings target could rise and warned that the situation appeared bleaker than ever.
She accused Independents – who inherited power after May’s collapse of the SNP, Liberal Democrat and Labour coalition – of failing to achieve agreed cuts for this year.
And she said she was “staggered” by information from finance director Derek Yule and resources chairman Bill Fernie.
The administration insists “significant energy is being spent on work to plan ahead and identify savings”.
A projected £46.3million shortfall for 2016-19 – revealed in June – takes account of pay awards, teacher pensions, changes to National Insurance and a 1.6% annual grant reduction.
Ms Smith complained yesterday that savings “agreed under my watch last December are not all on course to be realised”.
She claimed that, at best, estimates suggested next year’s savings target would be £21million, based on a sustained level of government funding.
But if, as expected, there is a 1.6% grant cut, she said the target could rise to about £27million.
If there is a failure to deliver on previous savings targets of up to £8million, as Ms Smith believes there will be, it would mean a “worst case scenario” of a £35million shortfall.
“I’m alarmed at all of this. There is suddenly no direction,” she said.
“If necessary, the SNP group will put forward an alternative budget and one that won’t involve staff losing their jobs.”
Council chiefs estimate that it will be January 18 at the earliest before 2016-17 grant figures are known because the Treasury has delayed its funding announcement until December.
Mr Fernie said: “We’re aware of the challenges. Difficult decisions will have to be taken. They will be the subject of detailed discussion with all political groups on the council.
“The figure of a £22million saving for next year included an assumed grant of 1.6%, so Ms Smith is inaccurate in her assumptions to add another £8million to the total.
“The previous SNP-led administration had years to do something about this.”
He added: “Poor decision-making last December included things such as less gritting on our roads, something we are trying to reverse as well as adding further attention to roads problems which are acknowledged by the public to be one of their top priorities.”
But Councillor Andrew Baxter, of the five-man Highland Alliance group, agreed with Ms Smith’s concern.
“The administration seems to be somewhat directionless on the budget,” he said.
“That’s leading to delayed decisions and, more worryingly, a lack of delivery on some of the savings that we’ve already agreed in previous years.”