1. Culture, Sport and Leisure Services in Scotland
February 2017

2. Context ongoing austerity better outcomes with reducing resources
increasing demand
changing delivery landscape
competition

3. Research process focus on: review of POBE data (Scottish Government)
how Councils and ALEOs are responding to the challenges
new delivery models
review of POBE data (Scottish Government)
survey of Councils and ALEOs (32 responses – 19 ALEOs and 13 Councils)
case studies

4. Today budget changes in culture and sport new delivery models
the future

5. Budgets
Tougher than ever before?

6. POBE (2016)
Changes in Local Government Expenditure by Service Area 2014/15 – 2016/17 (Scottish Government)
Education and social work up - everything else down
Culture and Related Services (incl. sport and leisure) down 7.5% over the period
Central Services and Planning and Development particularly badly hit (housing too)
Some caveats do apply to the data

7. POBE (2016)
Net Revenue Expenditure on Culture and Related Services 2014/15 – 2016/17 (Scottish Government)

8. POBE data (2016) 7.5% reduction between 2014/15 and 2016/17
Culture – 4% reduction (museums and galleries and libraries)
Sport – 9% reduction (all areas of service)
wide variation:
20 Councils increased expenditure on culture and related services between 2013/14 and 2015/16
BUT….28 Councils forecasting a decrease in the last year (from 2015/16 – 2016/17)
actual outturn data show that culture and related services took largest reduction (along with planning and development) – forecasts for other areas are more negative…

9. ALEOs
Maturing but under pressure

10. ALEO Survey 19 ALEOs responded
budget breakdown different to POBE (and includes capital spending)
best viewed in terms of general patterns than absolute numbers

11. ALEO Governance and Strategy
mix of governance models and Board structures
all report involvement in strategy development, mainly in partnership with Councils
NDR still primary driver for ALEO development, but growing awareness of other benefits?
wide range of positive impacts reported
few negatives – some fragmentation and complexity but at the margins
primary drivers of growth income generation, new facilities and new services

12. ALEO Survey - Culture Budget changes since 2014/15
Cuts in most areas (some ALEOs increased capital spend and direct provision)
Source: EKOS Survey

13. ALEO Survey – Sport and Leisure Budget changes since 2014/15
Cuts in direct provision and community sports activities
Source: EKOS Survey

14. ALEO Survey - Expected future budget changes
Expectation is to make savings equivalent or greater than other services
Savings most likely in direct provision
Source: EKOS Survey

15. ALEO Income – changes in last year
Increased income from trading activities
Management fee from Council decreasing
Source: EKOS Survey

16. ALEO Survey - How ALEOs expect to achieve savings
income generation and pricing changes
staff costs
back office
reductions in scale in some services
property rationalisation
Culture – pressure on libraries (again)
Sport and Leisure – pressure on indoor and outdoor facilities (scale)
many expect negative impacts on income generation, frequency, quality and range of services
but majority rate their ability to meet future challenges as good or very good

17. Councils
Budgets, budgets, budgets

18. Council Survey 13 authorities responded (but some deferred to ALEOs)
Some responses incomplete (particularly financial)
budget breakdown different to POBE (and includes capital spending)
best viewed in terms of general patterns than absolute numbers
degree of caution required
less in-house delivery than in previous surveys

19. Council Survey - Culture Budget changes since 2014/15
Slightly less negative picture than ALEOs but small numbers
Also note cuts to arms length bodies
Source: EKOS Survey

20. Council Survey – Sport and Leisure Budget changes since 2014/15
Cuts in direct provision and ALEOs
Source: EKOS Survey

21. Council Survey - Expected future budget changes
Expectation again is to make savings equivalent or greater than other services
Savings most likely in direct provision and ALEO investment
Source: EKOS Survey

22. How Councils expect to achieve savings
reducing staff costs
reducing scale of some services
property rationalisation
back office
pricing
interest in alternative delivery models (CAT and trusts)
libraries again looking vulnerable
Councils generally less negative (than ALEOs) about impacts
also evidence-based and confident that the evidence exists

23. Future Issues
Changing landscape?

24. Challenges financial pressures competing priorities
limited statutory protection
still some political scepticism regarding ALEOs (back-door privatisation/ loss of accountability etc)
limited scope to invest in ALEOs (existing and new) – risks constraining service delivery and income
optimum scale
demonstrating outcomes

25. Opportunities health and well being
economic development esp tourism/ regeneration/ creative industries
ALEOs as Council partners
wider partnerships – CPPs and HSCPs
income generation but needs investment
evidence-based planning
sharing good practice across the sector

26. Key Messages

27. Summary
ALEO models increasingly prevalent – move towards scale and multi- function
financial pressures maybe worse then ever before – tipping point?
ALEO models show benefits in income generation and efficiency but some persistent political concerns
initial NDR savings no longer reinvested in Trust/ service
annual budgets also a constraint on strategic planning
outcome focus continues – preventative spend and well being

28. Summary (cont)
Councils externalising services cannot expect major efficiencies with insufficient base budgets
‘salami slicing’ of budgets well past point of diminishing returns – need more radical solutions
capital investment remains critical particularly as competition ramps up
cutting culture, sport and leisure saves little but costs so much
ALEOs – closer to Councils not further away (‘independent’) – public service ethos remains critical

29. And finally…
slashing culture and sport budgets will NOT deliver necessary savings
…and allowing these services to decline will have huge costs to communities now and in future
make the case for your role in achieving the big priorities:
health and well being
economic growth
inequalities
think strategically about externalisation and partnership – even across Council borders