A PUBLIC spending watchdog has told Scotland's smallest mainland local authority to take "urgent and decisive" action to sort out its financial problems.
The Accounts Commission say they are "seriously concerned" with Clackmannanshire Council's financial position as it faces making savings of £29 million over the next three years out of an annual budget of £118 million.
It is one of three of the 32 councils that the Commission recently identified as at risk of running out of general fund reserves within two or three years, if they continued to spend reserves at the same rate in recent years.
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The Commission said strong leadership is now essential in the wake of "previous political instability" and said that "close working" is required between councillors and officers. It also recommends the council seeks external support, for example from other councils.
Accounts Commission graphic
The council is forecasting funding gaps for 2018/19 to 2020/21 of £13.1 million, £7.9 million and £7.7 million respectively. As a proportion of net spending it among the highest shortfalls of any Scottish local authority.
The council has agreed savings of £36 million since 2011 but the Commission said it has yet to make the transformational changes necessary to secure its financial position.
As a result it has had to use £15 million of reserves over the same period to balance the books which the Commission said was "not sustainable".
The watchdog said council must now make "difficult decisions" about the services it can afford to deliver.
Graham Sharp, chair of the Accounts Commission, said: "This report is a wake up call. Councillors and officers in Clackmannanshire urgently need to work together to make the fundamental changes required to address its financial position, so that it can continue to deliver the key services people depend on.
"This means taking difficult decisions it has put off in the past. But not taking them now is not an option and will only make things worse in the longer term."
The Commission said the council needed to consider whether it could continue to protect services from cuts, saying that the social services and education departments had continued to make the lowest savings relative to their overall budgets.
It also told the council that it need to address high levels of sickness absence.
In 2015/16, the average number of days lost through illness was 7.2 days for teachers and 13.4 days for other council employees. This was an improvement from 2012/13 when sickness absence was 15.7 days for teachers and 21.1 days for other council employees.
In the last financial year, the combined sickness absence for teachers and other council employees was 14.7 days compared to its target of 11.3 days.
In adult care services the average number of days lost increased from 15.1 days in 2015/16 to 21.0 days in 2016/17 - a rise of 39.2 per cent, and is well above the target rate of ten days. In child care services sickness rates rose from 7.4 days to 12.5 days, against the same target.
The Commission says the council’s sickness absence remains among the highest in Scotland and "does not compare favourably" to the Scottish average of 6.1 days for teachers and 10.6 days for other employees.
The report says thecouncil works well with other organisations to identify local priorities and deliver services.
Against a backdrop of budget reductions and service cuts, Clackmannanshire has maintained service performance and customer satisfaction in a number of key areas, although this isn't the case across all services.
The council's record in helping people leaving care to plan their future was one indicator of "declining performance", said the Commission.
The percentage of people over 16 leaving care with an allocated provider and pathway plan fell from 89 per cent in 2014/15 to 55 per cent in 2016/17.
The proportion of people leaving care with just an allocated pathway provider also fell from 100 per cent to 55 per cent over the same period.
Clackmannanshire Council Les Sharp accepted the local authority faced "unprecedented" financial challenges.
He said: "Members and officers will continue our focus on working together to ensure we deliver the best services we can for the community of Clackmannanshire.
"We are confident that we can address the challenges highlighted in this report, many of which are common to all councils in Scotland."