Arms Length External Organisation Saved Highland Council £9million
17th May 2018
A report published today by the local authority spending watchdog looks at how councils are using the estimated 130 ALEOs (arms-length external organisations) in Scotland, which have an annual spend of more than £1.3 billion, and the impact they are making.
ALEOs can take many forms - such as companies, community organisations or charities. Most run sports and leisure centres or cultural services like museums and theatres. Others provide social care services, property management, and commercial activities.
The Accounts Commission report says they have brought benefits, including reducing costs, increased uptake in sport and leisure and improved standards of care.
Councils have strengthened their oversight of ALEOs. They are showing improving practice in evaluating them as an option but could do more to involve the public and wider stakeholders in that process.
High Life Highland has realised a saving of £9.1 million in its first five years of operation; with rates and VAT savings making up around 56 per cent of the savings, and the remainder being achieved through income and efficiencies. Former Wick councillor Bill Fernie said,"As chairman of the Education, Culture and Sport committee it was a significant decision we took to grasp the opportunities for a more business like and efficient operation to make big savings and give a better long-lasting service for people in Highland."
The report also highlights issues in councils' use of ALEOs. It stresses the need to continue to follow the principles of the Following the Public Pound code agreed by the Commission and the Convention of Scottish Local Authorities. The Commission has since published updated guidance on governance, accountability and potential conflicts of interest such as councillors sitting on ALEO boards as well as carrying out their council role.
Councils see ALEOs a half-way house between providing services themselves and contracting out entirely to the private sector. They can operate flexibly to improve services for local people and bring in more income and benefit from tax breaks while allowing councils to retain some control and influence.
Around half of ALEOs are registered charities and this allows them relief from non-domestic rates. But the Scottish Government has indicated this would not be available to new ALEOs.
Graham Sharp, chair of the Accounts Commission, said: "ALEOs can and do provide significant benefits. But they are not without risk and changes in tax relief may make the creation of an ALEO a less attractive option for the future.
"This is highly complex area. Councils need to give it careful consideration to ensure they make the right decisions for their own communities."
130 ALEOs / £1.3bn turnover
Number of ALEOs estimated in Scotland
Four councils have eight or more ALEOs
25 councils / £430m turnover
Number of councils with leisure and/or culture ALEOs
3 councils / £186m turnover
Number of councils with social care ALEOs. They employ over 5,300 FTE staff
65 ALEOs / £550m turnover
Number of charitable ALEOs. They receive an estimated relief of £45 million on non-domestic rates
The full report can be seen at
Police in Lochaber can confirm that a 27-year-old man has been arrested in connection with alleged consumer protection offences in Fort William. It follows an investigation by Police Scotland and Highland Council Trading Standards, after a report was received this week of "bogus workmen" in Fort William and alleged fraudulent activity relating to charges for work carried out on a house in the town.
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Highland Council Trading Standards have produced guidance on how to spot the signs of scams that target businesses and also remind businesses to inform their employees on what to look out for when dealing with unsolicited telephone calls, emails and texts. All businesses as well as non-profit organisations (such as charitable organisations) may spend a lot of time dealing with potential scammers.
The Highland Council has written to parents and carers of school transport pupils to inform them that D&E Coaches have recently transferred a number of Highland Council contracts to Stagecoach and some school transport routes are included. These changes are to take effect from the first day back after the school holidays, Monday 7th January 2019 and timetables have been supplied for the routes affected.
Twenty nine members of The Highland Council's Care and Learning team have celebrated their success in completing the Council's 15 month ‘Lead On’ programme. ‘Lead On’, is a programme designed to develop practitioners’ understanding of change leadership and apply this through a change initiative in their place of work.
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Work underway to determine Highland's Budget allocation. Commenting after the news received last night of Councils' individual allocations, from the Scottish Government’s draft Budget, Budget Leader Councillor Alister Mackinnon said: "Having received the details of our allocation just last night, it will take some time to work through the proposed settlement and do a detailed analysis.
THROUGHOUT the month of November, The Highland Council's Chief Executive and members of the budget team have met with staff, groups and communities across the length and breadth of the Highlands. These sessions were part of a budget engagement exercise which also included facebook chats, survey, leaflet, video, and a budget challenge to raise awareness of budget challenges and gather views and priorities.
The Highland Council is to carry out a public consultation on the implementation of a transient visitor levy in the New Year. During the Council's public engagement activity during November, a strong theme was support for raising income from tourism, including a tourist levy, which could support local infrastructure, as well as the tourism sector itself.
Members have agreed six priority commitments in a revised Council Programme at today's council meeting. The six themes within the Programme are: A Council that Champions the Highlands; A Place to Live; A place to Thrive; A place to Prosper; A Welcoming Place; and Your Highland Council These themes and the actions which the council has agreed to, reflect priorities which have emerged through the round of public engagement during November.
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