Scotland Finance

In Conversation With… Cllr Roddie Mackay

Image courtesy Cllr Mackay

LGiU Scotland’s Kim Fellows chats to Cllr Roddie Mackay, leader of Comhairle nan Eilean Siar, about the new Islands Deal, service innovation and much more.

It would be helpful if you talked about what’s next for the services in your council area, and particularly when budgets are under pressure.

Well, we are under pressure and the extent of the cuts that we’ve faced over the last 10 years or so is well documented. I think since 2010 to 2019 we’ve had cuts equating to about 17% in our budget, which is a huge amount. So in figures, since 2010 we have had to save £35 million. That’s a huge, huge cut for a small authority. That’s the challenge in front of us so what are we doing about it? We have a programme to identify how can we make the best use of the money we have, rather than dwelling on the fact that we’ve got a lot less. We try and make better use of what we’ve got. So, I’m trying to lead us to a place where, instead of thinking, we used to get £10 now we get £8, so we cut by 20%, we decide  “let’s think differently”.

What we do say is we’ll make the best use of the £8 in order to maintain quality service delivery. It’s not easy but you can do a number of things around that idea. The general approach might be to cut things. And I guess in some ways that’s the simplest thing to do – cut, cut, cut. I think all of us as council members have decided to rise to the challenge of trying to make better use of the money we have and deliver services in a different way. Certainly there will be cutbacks in terms of the volume of services offered in different areas but, importantly, we want to be more efficient in how we deliver these services. Part of this is to develop a partnership approach with our communities, so that they understand what we’re trying to do, where they can participate, support and help us in delivering these services – in short, we’re trying to get them involved. It’s a challenge for us all, but most members understand that rather than simply sitting around and moping about the little money we have, it’s something we have to get on with and rise to the challenge. In fairness, we have a very able team of officers and they’re doing a lot of work around service redesign, working to generate more income from different sources and working to increase efficiency within their departments. We try and have a positive outlook in the face of these challenges.

Since setting our budget, the three initial areas for redesign have been economic development, public transport and waste. For example, with public transport, we’ve done some work around how we design services that make optimum use of assets. A simple example is that we don’t want to have buses running empty. Public transport’s an easy one for the public to understand because whenever we went out to consultation at any point over the last 10 years, people would always say “there’s a bus going through my village and it’s always empty, why are you running it?” Or they might say “why are you sending round the bin lorries every week? Why don’t you just do it every fortnight?” So there are areas that people do see and it does register with communities that there might be ways that we can save money. There’s no point in us going out and consulting with people and then not actually paying attention to it and doing something about it. So waste, public transport, and economic development are the three areas that we’re focusing on at the minute. Our plan is based on an assumption that nothing’s going to improve any time soon in terms of central funding, and so we’re going to try and save about £2.5million per annum over the next four years, so £10million in total. Again, that’s a big big challenge, and people will notice a difference on the ground. We take a view that we’re trying to do things smarter, and trying to generate income from different ways. It is possible that we can soften that blow and indeed sometimes an improved service for less money is possible – that would be a neat trick, but we think we can do it in some areas.

I think it would be helpful for us to learn about what you have learnt from developing the Islands Deal.

A lot of collaborative work has gone into the Islands Deal to date, and it’s, I would say, ready to go. There is a frustration, around the fact that we’re not getting an announcement that there is definitely a deal for the islands. We’re waiting for that announcement, and once that announcement comes then civil servants will start working on it. They won’t work on it in earnest, until such time as its announced, and normally the deals will be announced twice a year in the statements, The last indication we got was that possibly there’d be an announcement in the second half of this year.

In the process of putting it together, I guess one thing that I’ve noticed is that as we are coming in at the end of the deals process, (given most of the country already has them) the deals agreed early on appeared more flexible and didn’t seem to have quite the detailed demands we are hearing about. I guess through experience the deals now are more refined. When money was being issued for early deals there was a degree of flexibility around what it could be used for. We don’t seem to be getting that at the minute, because the newer deals seem more aligned to key UK and Scottish Government priorities. In any event, we are 100% confident that the Deal for the Islands that we are proposing meets these priorities. So we’re finding that the guidance we’re getting from Governments and working with SFT is pretty specific as to what they would expect us to include and what might be eligible.

It’s been an informative and thorough process, we’ve had very able advice and involvement from officers, and we now have a deal between the three islands (Orkney, Shetland and ourselves) that we think is really innovative and will contribute to the UK, to Scotland and more internationally. The resources that we have in the islands offer so much in terms of variety whether it’s investment in marine energy or the spaceports, low carbon initiatives or world class environment and heritage. We also take the view that it can’t be a per capita deal, obviously, because there are so many opportunities. It has to be about what the outcomes might be, and the outputs, and what we as islands can uniquely contribute. So I would argue, it makes good sense to invest in marine resources that the whole of the UK can benefit from, or to invest in space technology as that is a huge growing industry, or to spend on R&D programmes which can bring UK wide benefits. So we’re trying to demonstrate with the Islands Deal that in terms of bang for their buck, governments will get an excellent return from their investment for putting money into the islands.

There is an exciting suite of projects in the proposed Islands Deal ranging from energy projects and marine projects, to UNESCO world heritage sites  (St Kilda for example), and also innovative proposals around world class tourism, creative industries, digital technologies and joint innovation programmes. We remain hopeful that the deal will get announced sooner rather than later.

Following on from these experiences, I think it will be interesting to hear how you are innovating and actually protecting services.

We’ve got an extensive service redesign and transformational change programme – these are all buzzwords, but it is just change really. We wanted to change the way we did things. A good example is e-Sgoil, which is basically a way of delivering learning and teaching remotely. Sgoil is the Gaelic word for school and of course the islands are the heartland of Gaelic. This has been a remarkable success. It started off as an idea to ensure that across our four main secondary schools in the Western Isles, where we have challenges recruiting teachers in various subjects, we would be able to ensure equality of provision and choice across our island group. So we developed something whereby we could teach remotely, requiring effective technology solutions, and this led to us setting up what’s now called e-Sgoil. It really works and people have been getting good results, and now it’s become an innovative model that other bodies are replicating. We’re pleased that the Deputy FM encourages our work in this area, going as far as citing it as one of the leading innovations that he’s seen in education since the turn of the century. We’ve been getting involved with local authorities and other bodies locally, nationally and internationally, and what started as an innovative solution to meet our internal needs is evolving into an external income generating valuable asset.  So, the key thing is that it benefits our own local education, it is innovative in the sense that it’s a project or a way of doing things that can be transferred to other bodies and also it’s an income generator.

One thing we’re trying to encourage within our local authority is to get officers to start thinking about income generation. Obviously the priority in a local authority is service delivery, and understandably that’s the mindset, but we also want to get people thinking about income generation. So instead of cutting something by £10, wouldn’t it be much better if you could generate £10 to keep the service? It’s not possible in every area, but in every area where it is possible, we need to explore it. We do find, I have to say in fairness, that when we come up with ideas that are innovative, and show good use of resources, that central government is supportive, and they’ve given us great support around e-Sgoil, because it works well and it’s a good exemplar for others.

In terms of other aspects of redesign, we’re going through an extensive range of community consultations. We’re trying to find within communities if there’s an appetite to deliver services themselves. This isn’t in any way to lessen our duty [as a local authority] but we think there may be ways in which this could lead to an even better way of delivering services in some areas. Nobody knows better local needs than local people, and that goes right down to small villages and townships. Now some of these townships and villages have got income themselves, for example they might have turbines, so they’ve established community trusts. Others might not have that source of income and where we feel communities can deliver something we will support them, so it’s essential that they’re resourced and that they have the ability to deliver and that they’re accountable too. If we’re going to delegate and give communities the power and resources to do things then it’s important that they have to deliver on it because ultimately the councils are responsible. We always have the 4A test. Is there an Appetite, is there the Ability, are there Adequate Resources and has Accountability been established. Different local communities are coming up with ideas sometimes simple things like that they deliver all the winter gritting locally within their village, at a much lesser cost to the council.

Some [communities] are speaking to us about in-community bus services, for example, in Uist they already have been really innovative with local bus services. Within some communities they feel that with adequate resources they can get people of all ages around the community, to different venues, better and more flexibly than we can.

We feel that we’re coming across examples where it’s costing us say £100 to deliver something, and we can’t deliver it anymore. We could actually deliver a lesser service for the reduced £50 budget we have left, or, what if we give communities the £50? Can you still deliver what was similar to the previous service? And sometimes that can happen. Because they’re smarter, in terms of knowing local needs, at using the money, in the same way as we would say to government, as a local authority, give us flexibility in how we spend our money, because we know what local needs are, rather than ring-fencing it, it’s moving that idea out a stage further. The council is saying to our communities if we give you the money, the resources, the assistance, the manpower, or some appropriate mix of these, do you think you could do better? Of course, there’s a sense of ownership to a service, and it enhances the sense of community. Schools are only used 40-45% of the time and they’re empty buildings for the rest of the time. There is an opportunity to make better use of assets, open them up to the community. We’ve gone out to every community and had initial conversations and are now in the middle of a second round where we are now engaging with the groups within the communities that have shown an interest and wish to take it further. For example a community trust in one area, or a community council in another area, or residents association, and we’re now back engaging with them and seeing what they can do. Asking communities do you really value this service and if you do do you think that you want to protect it. If we give you the resources we have for this service, do you think you could do it better.

We’re also finding that communities are supportive in the sense of being very realistic as they know that council’s budgets are being slashed. The public know that what we’re trying to do is protect and deliver services in a falling budget scenario and they come on side. If we can get two or three good pilots up and running soon, we believe that will have a great effect and galvanise other areas to say “ah, that’s a good way of doing that.” We’re keen on that approach and we’re going to give it a go. So far, the feedback from communities has been very positive and very supportive. The council has set up a transformation and change team that is cross-council, and is led by a Director who has been responsible for a lot of innovative work around income generation. He leads and of course overseen by the Chief Executive. Within that team we’ve got senior people from HR, Finance and Communications. The team are working to drive these changes across council. If there’s a change coming along in economic development, if there’s a change coming along in transportation, if there’s changes coming from waste, and there’ll be other areas down the line, it all feeds through this team. They’ve got the big picture on – “are we achieving our targets?” We know we’re trying to save £2.5million, £10million over the piece, so they monitor if we are on target for that. They also look at innovative ways of raising income and wouldn’t it be wonderful if we managed to save £5million but we generated £5million. The push is council wide, no sense of silos, outcome driven and already we’ve restructured to ensure cross-council work. There is a feeling that within the old mentality of silos and departments there’s invariably going to be waste, duplication and inefficiency. So if we can get everybody thinking along the same lines in terms of outcomes we will realise some of these ambitions and that’s what the change team is doing.

Members, who initially might’ve had reservations, because it was doing something different, have been willing to give it try, and indeed officers used to doing their work and doing it well, but doing it in a particular way, these officers are starting to embrace this way of doing things

In summary, we need to spend money wisely and look at all the delivery options and income generation potential. Money is tight, and in such an environment we can develop a culture of real efficiency, and innovative thinking, and that’s what we’re trying to do.

Finally, for our readers what’s your personal number one ambition for this year?

I cannot settle for just one! So here’s a couple.

Firstly, in terms of what we deal with and seek to deliver as a public body, as a local authority.  There are some significant capital projects that we really want to get over the line, if I can mention these briefly. One is to build a new state of the art care facility which will include a care home, Housing with Extra Care and nearby a significant number of standard housing units. It’s our biggest capital project within this term, and we’re just in the process of finalising the project costing and funding. If we can do that, it will fulfil a long held ambition of the council. In addition we’ve got a an exciting project in Castlebay in Barra, which will be, we think, a model of public service delivery that will be really innovative. We’re looking at putting together learning and teaching (including the school) healthcare, economic development support and a range of other bodies to create a facility that will deliver on all these areas for the public. It’s a model of delivering services to the community that we don’t thank has been applied elsewhere. If we can build this model in Barra it’ll be a real success story. One of the things that it’s showing is that collaborative work can bring better outcomes for less cost, the neat trick I was speaking about earlier! NHS needs to replace the hospital in Barra, and we need to replace the school in Barra. The old way was that health did the hospital, and we did the school. Now we’re working with the health board to put the whole service offer together. The savings are significant for Scottish government and the public pound, and the outcome will be an improved service for our community in Barra. If we manage this I think it’s a model that government will embrace and will use elsewhere. The care home in Lewis, public service delivery model in Barra – these are the two main capital projects that we have as a council.

Secondly, outside of council, we have lots going on. We are the the biggest employer in the Western Isles, so are closely involved with the local economy and developments around the islands, In terms of democratic accountability, we are more aware of that than most because we make decisions that affect the people we meet in the street later on that day. Whereas in a big city environment you might never see these people. We’re integrated with our communities and we are a great lever for economic development, so the capital that comes in plays a big role. Currently we’ve got the biggest housing programme we’ve ever had underway, and it’s not without its challenges as we have a limited construction market and insufficient time to deliver. We contribute to bringing money into our community via different developments so economic development is a big part of what we do. In addition, there’s Spaceport 1 based on North Uist and we’re hoping that that takes off (if you’ll pardon the pun). We’re glad to see that at Arnish Point in Stornoway the fabrication yard is now being taken over by a Canadian firm who are starting to offer employment, win contracts and who are doing some renewable work at the minute but also have an excellent track record in oil and gas. This all dovetails with ambitious plans, now underway, to develop Stornoway Port.

I think for myself, if we can achieve our capital programme in terms of these two projects, and if we can see Spaceport in Uist along with the plans for redevelopment at the port at Stornoway it’d be a great result for the islands.  I would like to see all these come to fruition, and for our economy I guess the major one right now is to get an interconnector to the island, to build wind farms and to export [energy]. Developers are ready to build, but we can’t build anything unless we get the cable under the sea. We’ve been pushing for that for many years, I read recently a paper from 2003 where OFGEM said they were in favour of island wind, and here we are in 2019. It looks like we are nearer than ever to that goal and if we can achieve that in the lifetime of this local authority’s term, that would be really really significant, and I’d be delighted. In summary, [there’s] lots going on and potentially exciting times ahead.