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CBI in call for council shakeup

24 August 2009

CBI Scotland has called for a review of Scotland's local authority structure, in a bid to help reduce public spending levels.

A report prepared for the Scottish Parliament's local government finance inquiry, while recommending a continuation of the council tax freeze introduced by the SNP administration, also proposes a more fundamental review.

The CBI wants to see a public debate, "particularly [on] the vexed question of whether or not we still require 32 different local authorities and all the costs that involves, or whether a different model – e.g. involving metropolitan areas covering the principal cities – ought to be put in place".

As a start, councils are urged to look at sharing services, which the CBI records is already being considered by eight councils in west central Scotland.

It also wants to see councils contracting out back-office work such as payroll administration to specialist firms.

Pointing out that average band D council tax increased by 59% between 1997 and 2007, while earnings grew by 49%, the CBI said the current freeze should continue "until such time as council tax returns to more affordable levels".

The "golden period" for devolved spending was over, it added.

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