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
Highland Council Members have agreed to support the efforts of Caithness Transport Forum and Wick JOG Airport Consultative Committee to improve flight connectivity at Wick John O' Groats airport. Members were informed at Highland Council's headquarters that both organisations are pressing to have investigation work carried out on the potential to have a Public Service Obligation (PSO) created on one of the flight routes.
Improvements to the management of facility lets in Highland Council properties (including schools) has been welcomed by Members of The Highland Council's Environment, Development and Infrastructure Committee. Committee Chair, Cllr Allan Henderson said: "I would like to thank staff for the large amount of work has been undertaken since October 2016 when the Council's Redesign Board recommended the transfer of management of school lets to the Development and Infrastructure Service.
Planning guidance approved by the Highland Council today (Thursday 16 August 2018) has updated the financial contributions that new developments will be required to make towards facilities including schools, roads and the provision of affordable housing. Members of the Highland Council's Environment, Development and Infrastructure Committee today agreed to adopt the Developer Contributions Supplementary Guidance (DCSG) after a public consultation was undertaken in early 2018.
A 5 year Parking Policy and Guidance for The Highland Council area has been approved by Members of the Council's Environment, Development and Infrastructure Committee. The policy, which is required by the local authority to underpin its enforcement of decriminalised parking will cover the period from 2018 - 2023.
Highland Council Members have agreed to support the efforts of Caithness Transport Forum and Wick JOG Airport Consultative Committee to improve flight connectivity at Wick John O' Groats airport. Members were informed at Highland Council's headquarters today (16 August 2018) that both organisations are pressing to have investigation work carried out on the potential to have a Public Service Obligation (PSO) created on one of the flight routes.
The Council's Environment, Development and Infrastructure Committee has today agreed the Longman Landfill site in Inverness as the preferred location to construct a new centralised waste management facility (Materials Recovery Facility) to recover recyclates and produce Refuse Derived Fuel, as the Council's preferred interim arrangements for meeting the requirements of the ban on landfilling which commences in January 2021. This facility will process all of the Highland’s 83,000 tonnes of residual (non-recyclable) waste from 2021 onwards.
The Winter Service Policy for The Highland Council this coming winter 2018/19 has been approved by Members of the Council's Environment, Development and Infrastructure Committee. The Council's policy relates to clearing and gritting of Highland Council adopted roads, cycle ways, footways and footpaths.
On Thursday 16th August 2018 councillors on the Environment, Development and Infrastructure committee will discuss the update from Caithness and North Sutherland Regeneration Partnership which is reproduced below. 3.
The Environment, Development and Infrastructure committee of Highland Council will meet on Thursday 16th August 2018. Item 23 on the agenda is "Parking Services".
The Highland Council is delighted to be working with the University of Dundee and the University of the Highlands and Islands to support Highland-based people who are interested in a career move to gain both their PGDE and complete their induction year within 18 months. Following an earlier event in June, Highland Council and the University of Dundee and University of the Highlands and Islands are hosting a second information evening on Tuesday 14 August 2018 from 5:30pm - 7pm at the University of Highlands and Islands, Inverness College, Inverness Campus IV2 5NA.
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