Council faces �8m budget 'hole'

The sale of old school sites was hoped to help pay for new schools

High energy costs and falling property values have been blamed for an �8m "hole" in a Scottish council's budget.

Scottish Borders Council has warned it will have to find savings across a range of services.

Electricity costs have risen 70% with gas prices up 28% while forecast revenues from selling former school sites have fallen significantly.

Council leader David Parker said there were some "difficult and hard decisions" which had to be made.

Mr Parker said a clearer picture of the budget would emerge by January.

"I think we need to wait and see what comes out of the budgetary process in the year ahead," he said.

I think there is a greater realisation among tax payers and parents in particular that we do have a finite budget and that we have to cut our cloth to that budget Councillor Neil Calvert

"There is no doubt there will be things that we will do that people may not find particularly palatable or not find popular.

"There will be difficult and hard decisions that require to be made."

However, he insisted this would not be at the cost of services to the public.

"All the work we do is to try to make sure that we maintain a level of service and that we keep service quality," he said.

The council is also facing pressure due to rising wage costs.

Projects like rebuilding primary schools, a relief road in Galashiels and regeneration plans for Kelso will go ahead - although there may be delays.

Other schemes, however, may be postponed.

Under pressure

Savings will also be sought in reviews of provision of services for children, the elderly and support services.

Executive finance spokesman, Councillor Neil Calvert, said he believed the public understood the pressures the council was under.

"I think there is a greater realisation among tax payers and parents in particular that we do have a finite budget and that we have to cut our cloth to that budget," he said.

Mr Parker said there was usually a shortfall in council budgets at this stage of the year but said the situation had been aggravated by price rises and the credit crunch.

However, there are no plans to increase council tax when the final budget is unveiled in February.

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