Council / Education budget approved but more concern over ‘unsustainable’ use of reserves
THE FIRST of the council’s budgets for the upcoming financial year has been agreed by elected members this week.
A budget of £64.228 million – the largest across the council – was approved for the children’s services directorate at Monday’s meeting of the education and families committee.
That is an increase of £1.592 million compared with the 2024/25 revised budget, and will require a £7.8 million “unsustainable” draw from the council’s reserves.
The budget for the children’s services directorate, which delivers Shetland’s schools and youth clubs, makes up almost a third of the council’s overall £178.4 million budget for the year.
It will also have to go before the policy and resources committee on Thursday and full council next week to be signed off.
Councillors heard that in order to achieve financial balance across the SIC in the year ahead across £44.8 million of reserves will be required – of which almost half, £21.8 million, is considered unsustainable.
The committee heard as well that the children’s services directorate had a £596,000 overspend for the current financial year.
But of that overspend almost half – £285,000 – went towards the teacher pay award.
Committee chairman Davie Sandison said they had been “pretty much on target”, with Lerwick South councillor John Fraser calling it a “phenomenal effort”.
Looking at the year ahead, however, Shetland Central member Moraig Lyall was keen to strike a note of caution.
“There’s been significant growth but not really any progress towards the unsustainable draw on reserves,” she said.
“We wouldn’t want to be patting ourselves on the back too much.
“Just standing still isn’t going to be sufficient.”
She admitted though that any cuts were “pretty tricky for this directorate to make” given so much of what they did, particularly around schools and teaching, was bound by law or national guidance.
Council leader Emma Macdonald said by far their biggest cost was on staff, something they had “very little control over”.
Macdonald said pay negotiations would start in the coming months.
And though the council wanted the “best possible deal we can afford to give” staff, that would come “mostly unfunded”.
“We have to carry the cost of that,” she added.
“Pay, and the unknown of that, will be a factor.”
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