Agenda reports pack
Argyll and Bute Council · 8 May 2025
Back to Policy and Resources Committee — 8 May 2025 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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Argyll and Bute Council Comhairle Earra-Ghàidheal Agus Bhòid Executive Director: Douglas Hendry Kilmory, Lochgilphead, PA31 8RT Tel: 01546 602127 Fax: 01546 604435 DX 599700 LOCHGILPHEAD 1 May 2025 NOTICE OF MEETING A meeting of the POLICY AND RESOURCES COMMITTEE will be held ON A HYBRID BASIS IN THE COUNCIL CHAMBER, KILMORY, LOCHGILPHEAD AND BY MICROSOFT TEAMS on THURSDAY, 8 MAY 2025 at 10:30 AM, which you are requested to attend. Douglas Hendry Executive Director BUSINESS 1. APOLOGIES FOR ABSENCE 2. DECLARATIONS OF INTEREST (IF ANY) 3. MINUTES (Pages 3 - 10) Policy and Resources Committee held on 20 February 2025 4. BUDGET OUTLOOK 2026-27 TO 2030-31 (Pages 11 - 28) Report by Section 95 Officer 5. HEALTH AND SOCIAL CARE PARTNERSHIP – FINANCIAL POSITION (Pages 29 - 34) Report by Section 95 Officer 6. EMPTY PROPERTY RELIEF FOR BUSINESSES - POLICY UPDATE (Pages 35 - 42) Report by Executive Director with responsibility for Finance * 7. CORPORATE PLAN 2025 - 2027 (Pages 43 - 68) Report by Executive Director with responsibility for Customer Support Services * 8. ARTIFICIAL INTELLIGENCE POLICY (Pages 69 - 84) Report by Executive Director with responsibility for Customer Support Services Public Document Pack
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9. ARGYLL AND BUTE EQUALITY MAINSTREAMING REPORT 2025 (Pages 85 - 114) Report by Executive Director with responsibility for Customer Support Services 10. ITRENT HR AND PAYROLL SYSTEMS REPLACEMENT PROJECT UPDATE (Pages 115 - 134) Report by Executive Director with responsibility for Customer Support Services and Financial Services 11. PROPOSED AMENDMENT TO THE AGE AT WHICH AN LGPS EMPLOYEE CAN MAKE AN APPLICATION FOR FLEXIBLE RETIREMENT (Pages 135 - 140) Report by Executive Director with responsibility for Customer Support Services 12. PLACE BASED INVESTMENT 2025/26 - PLACE BASED INVESTMENT PROJECTS AND ALLOCATION & CROWN ESTATE 2025/26 - UPDATE (Pages 141 - 148) Report by Executive Director with responsibility for Development and Economic Growth 13. HELENSBURGH WASTE TRANSFER STATION PROJECT UPDATE (Pages 149 - 158) Recommendation from meeting of Environment, Development and Infrastructure Committee held on 20 March 2025 REPORT FOR NOTING 14. POLICY AND RESOURCES COMMITTEE WORKPLAN (Pages 159 - 162) The above minutes are submitted to the Council for approval of any recommendations on the items which the Committee does not have delegated powers. These items are marked with an *. Policy and Resources Committee Councillor John Armour Councillor Gordon Blair Councillor Math Campbell-Sturgess Councillor Audrey Forrest (Vice-Chair) Councillor Kieron Green Councillor Amanda Hampsey Councillor Mark Irvine Councillor Reeni Kennedy-Boyle Councillor Jim Lynch (Chair) Councillor Luna Martin Councillor Liz McCabe Councillor Dougie McFadzean Councillor Yvonne McNeilly Councillor Ross Moreland Councillor Gary Mulvaney Councillor Dougie Philand Contact: Hazel MacInnes, Senior Committee Officer Tel:01546 604269
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MINUTES of MEETING of POLICY AND RESOURCES COMMITTEE held in the ON A HYBRID BASIS IN THE COUNCIL CHAMBER, KILMORY, LOCHGILPHEAD AND BY MICROSOFT TEAMS on THURSDAY, 20 FEBRUARY 2025 Present: Councillor Jim Lynch (Chair) Also present: Councillor John Armour Councillor Gordon Blair Councillor Math Campbell-Sturgess Councillor Audrey Forrest Councillor Kieron Green Councillor Amanda Hampsey Councillor Jan Brown Councillor Fiona Howard Councillor Reeni Kennedy-Boyle Councillor Luna Martin Councillor Dougie McFadzean Councillor Yvonne McNeilly Councillor Ross Moreland Councillor Gary Mulvaney Councillor Tommy Macpherson Councillor Peter Wallace Attending: Pippa Milne, Chief Executive Douglas Hendry, Executive Director Kirsty Flanagan, Executive Director Carolyn Earl, Interim Head of Financial Services Jane Fowler, Head of Customer and Support Services Ross McLaughlin, Head of Commercial Services Fergus Murray, Head of Development and Economic Growth Suzanne Mason, Engagement and Communities Lead Shona Barton, Governance Manager Jonathan Welch, Transformational Projects and Regeneration Manager Fergus Walker, Revenues and Benefits Manager 1. APOLOGIES FOR ABSENCE Apologies for absence were received from Councillors Mark Irvine and Liz McCabe. 2. DECLARATIONS OF INTEREST (IF ANY) There were no declarations of interest intimated. 3. MINUTES The Minutes of the meeting of the Policy and Resources Committee held on 5 December 2024 were approved as a correct record. * 4. FINANCIAL REPORTS MONITORING PACK - 31 DECEMBER 2024 The Committee gave consideration to a report providing a summary of the financial monitoring reports as at 31 December 2024. Decision The Policy and Resources Committee agreed to – 1. note the revenue budget monitoring report as at 31 December 2024; Page 3 Agenda Item 3
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2. note the financial risks for 2024-25; 3. note the capital plan monitoring report as at 31 December 2024 and approve the proposed changes to the capital plan outlined in Appendix 4 of that report; and 4. note the reserves and balances report as at 31 December 2024. (Reference: Report by Section 95 Officer dated 17 January 2025, submitted) Councillor Luna Martin left the meeting during consideration of the next item of business. * 5. BUDGETING PACK 2025-26 The Committee gave consideration to the full package of papers included in the budgeting pack in relation to the revenue and capital budgets for 2025-26. Decision The Policy and Resources Committee agreed to refer consideration of the Budgeting Pack 2025-26 to the Council meeting on 27 February 2025, without recommendation. (Reference: Budgeting Pack 2025-26 dated 13 February 2025, submitted) * 6. TREASURY MANAGEMENT STRATEGY AND ANNUAL INVESTMENT STRATEGY 2025-26 The Committee gave consideration to a report presenting the draft Treasury Management Strategy and Annual Investment Strategy for 2025-26, and the Prudential and Treasury Indicators for 2025-26 to 2027-28. Decision The Policy and Resources Committee – 1. noted the Treasury Management Strategy and Annual Investment Strategy for 2025-26, and the Prudential and Treasury Indicators for 2025-26 to 2027-28; and 2. agreed to refer the report to full Council for approval. (Reference: Report by Section 95 Officer dated 10 February 2025, submitted) 7. ARGYLL AND BUTE UK SHARED PROSPERITY FUND INVESTMENT PLAN, TRANSITION YEAR 2025/26 The Committee gave consideration to a report presenting the Argyll and Bute UK Shared Prosperity Fund (UKSPF) Transitional Year Investment Plan for 2025/26. Decision The Policy and Resources Committee – Page 4
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1. noted the content of the report; 2. approved the Argyll and Bute UKSPF Transitional Year Investment Plan for 2025/26; and 3. agreed that a progress report on the investment plan for 2025/26 would be presented at the Policy and Resources Committee in October 2025. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated 6 February 2025, submitted) 8. FUTURE OF THE ARGYLL AND BUTE FLEXIBLE FOOD AND FUEL FUND The Committee gave consideration to a report presenting a contingency plan for funding the Argyll and Bute Flexible Food and Fuel Fund for 2025/26, leveraging a combination of the UK Shared Prosperity Fund (SPF) and earmarked reserves for Revenues and Benefits administration works. Decision The Policy and Resources Committee – 1. acknowledged the work done to date to directly support people to cope with food and fuel poverty and other cost of living pressures, with over £4.3m in financial benefits delivered and almost 2,000 households and 800 children receiving the help that they need; 2. recognised the importance of extending the fund so that people in Argyll and Bute who need help can continue to get support; 3. welcomed and agreed the plan to extend the Flexible Food and Fuel Fund to 31 March 2026, supported by the following funding sources: • UK Shared Prosperity Fund (60% of £204,000): £122,400 • Earmarked reserves: £189,600 • Total cost for 2025/26: £312,000 4. noted the recent correspondence to the Committee from Argyll and Bute Citizen’s Advice Bureau and agreed that officers would continue to explore potential for any future additional partnership working that may be possible. (Reference: Report by Executive Director with responsibility for Finance dated 13 January 2025, submitted) 9. SUPPORTING COMMUNITIES FUND 2025-26 The Committee gave consideration to a report detailing proposals for an improved process for the Supporting Communities Fund in 2025/26, adding to the outlined proposals approved by Policy & Resources Committee in December 2024. Decision Page 5
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The Policy and Resources Committee agreed – 1. a focus on digital first with promotion of an online application; 2. non-digital application available if needed to ensure fairness and equality; 3. a shorter application – one of the key asks from the community survey; 4. maximum funding which can be applied reduced from £2,500 to £1,500 - allowing more community groups to be awarded funding; 5. groups eligible to apply continue to be all third sector organisations in Argyll and Bute, with additional criteria of: ‘who have a turnover of £150,000 or less’; and 6. funding is to remain available for projects that come under one or more of the following criteria: Fairer, Resilient, Greener and Creative. (Report by Chief Executive dated 29 January 2025, submitted) * 10. SUSTAINABLE PROCUREMENT STRATEGY 2025/2028 - DRAFT DOCUMENT AND CONSULTATION The Committee gave consideration to a report seeking approval for the draft revised Sustainable Procurement Strategy 2025/2028. Decision The Policy and Resources Committee – 1. noted the key changes to the Sustainable Procurement Strategy 2025/2028, and the changes made to the strategy following the consultation period; and 2. recommended to the Council agreement of the revised final Sustainable Procurement Strategy 2025/2028, and the publication on the council’s website in April 2025 (Reference: Report by Executive Director with responsibility for Legal and Regulatory Support dated 17 December 2024, submitted) 11. EQUALITY OUTCOMES 2025-2029 The Committee gave consideration to a report detailing work which has been undertaken to develop a new set of Equality Outcomes which will cover the period May 2025 to April 2029 as required to comply with the Public Sector Equality Duty. Decision The Policy and Resources Committee approved the following set of Equality Outcomes for the period 2025-2029 – 1. We make access to information and services easier for people with protected characteristics. Page 6
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2. Our communities are safe for, and welcoming to, people with protected characteristics. 3. We raise awareness of issues and challenges faced by people with protected characteristics along with ways to accommodate and support them. 4. Argyll and Bute welcomes New Scots and supports them. 5. We ensure people with protected characteristics are enabled to progress. 6. Our work relating to equalities and people with protected characteristics is coordinated across the organisation and its partners and is strategically aligned. (Reference: Report by Executive Director with responsibility for Customer Support Services dated 14 January 2025, submitted) 12. CONSERVATION AREA REGENERATION SCHEME (CARS) PROJECT 15-19 ARGYLL STREET, LOCHGILPHEAD The Committee gave consideration to a report seeking approval to award an additional Private Sector Housing Grant of £21,220, to help bridge the budget shortfall for external building works at 15-19 Argyll Street, Lochgilphead. Decision The Policy and Resources Committee approved utilisation of the £21,220 balance of Private Sector Housing Grant allocated to the Lochgilphead CARS projects by Full Council on 21st February 2019 to bridge the funding shortfall at the 15-19 Argyll Street Lochgilphead CARS project. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated 6 January 2025, submitted) 13. COMMUNITY REGENERATION PARTNERSHIP FUNDING The Committee gave consideration to a report detailing 5 priority projects to put forward for potential funding from the Community Regeneration Partnership. Decision The Policy and Resources Committee – 1. approved the updated list of priority projects included at Appendix 1 of the report, which will form the basis of further negotiations with the UK and Scottish Governments; and 2. noted that all funding requires to be committed by financial year 26/27 and would be subject to business case approvals by Ministry of Housing, Communities and Local Government Ministers. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated January 2025, submitted) Page 7
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14. CROWN ESTATES FUNDING ALLOCATION 2025/26 The Committee gave consideration to a report setting out proposals for the allocation of the remaining Crown Estates budget allocated in the 2024/25 financial year. Decision The Policy and Resources Committee – 1. considered and approved the time sensitive proposals set out in Table 1 of the report for the remaining Crown Estates budget allocated in the 2024/25 financial year; and 2. noted that a further report would be brought back to the Policy and Resources Committee identifying priority projects for the 2025/26 Crown Estates funding allocation. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated 16 January 2025, submitted) * 15. STRATEGIC EVENTS AND FESTIVALS FUND - ROUND 7 2025-26 The Committee gave consideration to a report providing an update on Round 7 (2025/26) of the Council’s Strategic Events and Festivals Fund (SEF) and details of the applications submitted and the applications recommended to receive funding. The report also sought agreement to allocate a minimum of £90,000 funding to allow for a SEF Round 8 in 2026/27. Decision The Policy and Resources Committee– 1. agreed to the award of eligible SEF Round 7 grants amounting to £106,036 as detailed in Table 1 of the report; 2. agreed that any SEF Round 7 grant offer be formally issued upon confirmation from the event organisation that the event is confirmed as going ahead, match funding is in place and the event still meets the SEF Round 7 criteria; 3. agreed to continue delegation of powers to the Executive Director with responsibility for Development and Economic Growth to allow any subsequent amendment to existing grant requests due to changes to the event/event budget. Any amendment to a current grant request/offer would only be considered if the amendment related to either the same level or a reduction in the request and constitute up to 75% of legitimate and eligible expenditure. Similarly, if there was a reduction in the final event costs that would result in delivery of a profit more than £10,000 (all of which must be reinvested to future events) to the organisation and that this was sustained over a 3-year period, the final retention (10%) would not be paid out on the third year of the grant; 4. agreed to recommend to Council that as part of the budget in February 2025, that they agree a minimum of £90,000 base funding for Strategic Events and Festivals in order that the application process can commence for Round 8 (2026/27); and Page 8
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5. agreed and recommended to Council that any underspend from SEF Round 6 (2024/25) was earmarked and used to augment a future SEF round. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated 6 December 2024, submitted) 16. ROYAL NATIONAL MOD 2028 The Committee gave consideration to a report seeking approval in principle on An Comunn’s offer for Argyll and Bute to host the Royal National Mòd (RNM) in 2028. Decision The Policy and Resources Committee – 1. agreed in principle to hosting the RNM in Dunoon or Oban in 2028 and for the requirement to enter into an agreement with An Comunn to provide a maximum of £200K financial support over a four year period with the final payment in financial year 2028-2029; 2. agreed to the Council working with Live Argyll to secure the use of the venues for the duration of the RNM at no cost to the RNM; and 3. noted that the An Comunn Board meet in March 2025 and had requested that the Council provide an in principle decision by this date. (Reference: Report by Executive Director with responsibility for Development and Economic Growth dated 5 February 2025, submitted) 17. POLICY AND RESOURCES COMMITTEE WORK PLAN The Policy and Resources Committee Workplan was before the Committee for noting. Decision The Policy and Resources Committee noted the content of the Workplan as at 20 February 2025. (Reference: Policy and Resources Committee Workplan dated 20 February 2025, submitted) Page 9
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 BUDGET OUTLOOK 2026-27 TO 2030-31 1. EXECUTIVE SUMMARY 1.1 This report summarises the Budget Outlook for the five year period 2026-27 to 2030-31, taking account of the budget decisions approved at the Council meeting on 27 February 2025. This is the first outlook report of the new financial year, rolling forward previous forecasts and extending the period to 2030-31, as well as updating planning assumptions, as appropriate. These assumptions will continue to be updated and refined on an ongoing basis throughout the year. 1.2 The Budget Outlook has been prepared using three different scenarios, best case, worst case and mid-range. The detailed information focusses primarily on the mid-range scenario, however, all three scenarios are outlined within Appendix 1. 1.3 1.4 There has been no change to assumptions in respect of future years’ Scottish Government funding since those reported as part of the Budget Pack on 27 February 2025. Despite an unexpected effective increase of 1.47% in our 2025-26 settlement, it would be imprudent to assume similar increases in future years, with increases over the previous 3 years being as low as 0.01%. At this stage, a Scottish average increase of 0.5% for the mid-range, with a variation of 0.5% for the best and worst case scenarios, are the suggested planning assumptions. As this council relies on the floor mechanism to protect its funding level, our settlement is lower than the Scottish average change. The floor was set at 0.75% below the Scottish average in 2025-26 and is likely to continue at this level. As such, funding assumptions for this council range between an increase of 0.25% (best case) and a reduction of 0.75% (worst case), with a reduction of 0.25% in the mid-range scenario. At this stage, it continues to be deemed prudent not to assume that funding received in respect of Packaging Extended Producer Responsibility from the Department of Environment, Food and Rural Affairs (DEFRA) in 2025-26 will be recurring in 2026-27 and future years, without a reduction in Scottish Government grant funding. Funding conditions and future years budget pressures remain unclear and the final allocation for 2025-26 is not expected to be confirmed until the autumn. 1.5 There are no changes to previous assumptions in respect of Council Tax growth. The Council Tax base is assumed to grow by 0.25% in the worst case, 0.5% in the mid-range and 0.75% in the best case scenarios. 1.6 Assumptions in respect of employee costs for council services are as follows: Page 11 Agenda Item 4
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The Public Sector Pay Policy, published alongside the Scottish Budget, sets out a multi-year framework of a 9% pay envelope covering 2025-26, 2026- 27 and 2027-28. A planning assumption of 3% across each of these years has been applied in both the best case and mid-range scenarios, with 5% assumed in the worst case scenario. For 2028-29 and 2029-30, the best case scenario has been reduced to 2%, while the mid-range remains at 3% and worst case remains at 5%. The SJC and Chief Officers pay awards for 2025-26 have still to be agreed and may have an impact on the base budget if the pay award is higher than the 3% allowed for in the budget. The Teachers pay award now covers the period August to July and for 2025-26 has already been agreed up to 31 July 2025, however, any increase beyond that date is still in the negotiation stage. The cost of pay increments for 2025-26 is estimated at £0.599m. For future years, an equivalent cost has been assumed in the mid-range and worst case scenarios, while half the estimated 2025-26 cost has been assumed in the best case scenario. 1.7 For non-pay inflation, only unavoidable inflation has been provided for within each scenario, with the mid-range scenario based on current market forecast data, where available. A further general inflation contingency has been built into the mid-range and worst case scenarios. Due to current market volatility and prevalent levels of uncertainty, at this stage, there has been no change to the inflationary assumptions included within the 2025-26 Budget Pack. 1.8 There are a number of cost and demand pressures for council services built into each scenario, across all five years, comprising the following: ASN Support Election Costs Education ICT Network Infrastructure Planning (Local Development Plan) Universal Credit – HB Admin grant Civica Revenue and Benefits Management System Compliance with BMW Ban Bus Transport Contracts Migration to Teams Telephony Valuation Joint Board 1.9 In addition to the identified cost and demand pressures, a general allowance for currently unforeseen or unquantifiable cost and demand pressures has been included in each scenario (best case £0.250m, mid-range £0.500m and worst case £1m per year). 1.10 Political decisions will require to be made in respect of the allocation to the Health and Social Care Partnership in future years. As part of the 2025-26 budget process, indicative base allocations of £85.045m were agreed for 2026- 27 and 2027-28, with future years’ allocations being subject to Scottish Government grant funding and the council’s overall financial position. The Page 12
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indicative allocation for 2026-27 represents an increase of £3.053m to flat cash, reflecting the non-recurring saving in relation to the Strathclyde Pension Fund contribution. 1.11 The budget gap in the mid-range scenario, prior to measures to balance the budget, either from previous savings decisions or new potential options, is estimated at £14.442m in 2026-27 and £58.195m over the five year period 2026-27 to 2030-31. 1.12 The measures to balance the budget over the next five years are as follows: Proposed increases to fees and charges of between 3% and 9% each year (6% mid-range). Proposed increases to Council Tax at 5% each year for all scenarios. Management/Operational and Policy savings already agreed by Council in February 2025 and previous years. 1.13 The budget gap in the mid-range scenario, after measures to balance the budget, is estimated at £9.568m in 2026-27 and £33.846m over the five year period 2026-27 to 2030-31. 1.14 The budget gap in the best case scenario is estimated at £6.068m in 2026-27 and £13.415m over five years, increasing to £16.159m in 2026-27 and £67.384m over five years in the worst case scenario. A summary of all three scenarios is included within Appendix 1. 1.15 It is recommended that the Policy and Resources Committee consider the current Budget Outlook position for the period 2026-27 to 2030-31. Page 13
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 BUDGET OUTLOOK 2026-27 TO 2030-31 2. INTRODUCTION 2.1 This report summarises the Budget Outlook for the 5-year period 2026-27 to 2030-31, taking account of the budget decisions approved at the Council meeting on 27 February 2025. This is the first outlook report of the new financial year, rolling forward previous forecasts and extending the period to 2030-31, as well as updating planning assumptions, as appropriate. These assumptions will continue to be updated and refined on an ongoing basis throughout the year. 2.2 The Budget Outlook has been prepared using three different scenarios, best case, worst case and mid-range. Relatively small variations in assumptions can lead to fairly significant changes in the outcome. In the paragraphs that follow, the mid-range outlook is shown, however, all three scenarios are detailed within Appendix 1. 3. RECOMMENDATIONS 3.1 It is recommended that the Policy and Resources Committee consider the current Budget Outlook position for the period 2026-27 to 2030-31. 4. DETAIL 4.1 Funding Scottish Government Finance Settlement 4.1.1 4.1.2 Estimates of future Scottish Government funding levels is one of the key assumptions within the Budget Outlook. Whilst council’s are recommended to prepare longer term financial plans, with a focus on financial sustainability, this is more challenging with one year Scottish Government finance settlements. Council’s will continue to lobby via COSLA for multi-year settlements to assist with longer term financial planning. As part of the 2025-26 budget setting process, members were advised that despite an unexpected effective increase of 1.47% in our 2025-26 settlement, it would be imprudent to assume similar increases in future years, with increases over the previous 3 years being as low as 0.01%. There has been no change to assumptions in respect of future years’ Scottish Government funding since those reported as part of the Budget Pack on 27 February 2025. At this stage, a Scottish average increase of 0.5% for the mid-range, with a variation of 0.5% for the best and worst case scenarios, are the suggested planning assumptions. As this council relies on the floor mechanism to protect its funding level, our Page 14
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settlement is lower than the Scottish average change. The floor was set at 0.75% below the Scottish average in 2025-26 and is likely to continue at this level. As such, our funding assumptions range between an increase of 0.25% (best case) and a reduction of 0.75% (worst case), with a reduction of 0.25% as the mid-range scenario. 4.1.3 The table below summarises the mid-range scenario estimates based on a 0.25% settlement reduction year on year. This includes additional funding in respect of increased Employer’s National Insurance Contributions. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Estimated SG Funding 261,058 260,406 259,755 259,106 258,459 4.1.4 At this stage, it continues to be deemed prudent not to assume that funding received in respect of Packaging Extended Producer Responsibility from the Department of Environment, Food and Rural Affairs (DEFRA) in 2025-26 will be recurring in 2026-27 and future years, with no reduction in Scottish Government grant funding. Funding conditions and future years budget pressures remain unclear and the final allocation for 2025-26 is not expected to be confirmed until the autumn. It was agreed as part of the 2025-26 budget process that £2.499m of the estimated 2025-26 funding of £3.847m would be carried forward for use in 2026-27. Council Tax 4.1.5 The Council Tax base for 2025-26 is set at £70.204m, which reflects the 9.9% increase agreed by the Council on 27 February 2025. 4.1.6 There are no changes to previous assumptions around the growth in Council Tax. It has been assumed that there will be 0.5% growth in the mid-range scenario for all years from 2026-27 (0.75% in the best and 0.25% in the worst case scenarios). Following the setting of Council Tax in February, the future years estimates have been updated reflecting the adjusted base Council Tax Budget. 4.1.7 In the first instance, this report presents the budget gap, prior to any measures to balance the budget. For this purpose, Council Tax is assumed to remain at the same levels as 2025-26, with only growth in the Council Tax base reflected. General Fund 4.1.8 As reported in prior years, reduced employer contribution rates payable to Strathclyde Pension Fund will result in one-off savings in 2024-25 and 2025-26. It was agreed by Council in February 2024 that £2m of the pension fund gain would be released each year for a period of 3 years (2024-25 through to 2026- 27), in order to help bridge the budget gap. Page 15
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Funding Summary 4.1.9 The table below summarises the estimated total funding in the mid-range scenario over the 5 years 2026-27 to 2030-31. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Estimated SG Funding 261,058 260,406 259,755 259,106 258,459 EPR – 2025-26 DEFRA Funding C/fwd 2,499 0 0 0 0 Released Strathclyde Pension Fund Gain 2,000 0 0 0 0 Council Tax Base 70,204 70,204 70,204 70,204 70,204 Council Tax Growth 351 704 1,059 1,415 1,773 Total Estimated Funding 336,112 331,314 331,018 330,725 330,436 4.2 Base Budget 4.2.1 The 2025-26 budget approved by Council on 27 February 2025 was £328.289m. This included the 2025-26 debt charge implications of approved borrowing for additional capital investment. There was also a decision to defer a policy saving in respect of Community Sports until 2026-27 onwards. The full year effect of these previous budget decisions on 2026-27 and future years are now incorporated as base budget adjustments. 4.2.2 The revised base budget is outlined in the table below: 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Base Budget 2025-26 328,289 328,289 328,289 328,289 328,289 Debt Charges Increase 95 95 95 95 95 Approved Policy Savings (20) (20) (20) (20) (20) Revised Base Budget 328,364 328,364 328,364 328,364 328,364 4.3 Employee Cost Changes Pay Award 4.3.1 The Public Sector Pay Policy, published alongside the Scottish Budget, sets out a multi-year framework of a 9% pay envelope covering 2025-26, 2026-27 and 2027-28. A planning assumption of 3% across each of these years has been applied in both the best case and mid-range scenarios, with 5% assumed in the worst case scenario. For 2028-29 and 2029-30, the best case scenario has been reduced to 2%, mid-range remains at 3% and worst case remains at 5%. 4.3.2 The SJC and Chief Officers pay awards for 2025-26 have still to be agreed and may have an impact on the base budget if the pay award is higher than the 3% allowed for in the budget. The Teachers pay award now covers the period August to July and for 2025-26 has already been agreed up to 31 July 2025, however, any increase beyond that date is still in the negotiation stage. It is worth noting that a pay offer has been made to the NHS Agenda for Change Page 16
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workforce. The offer comprises 4.25% for 2025-26 and 3.75% for 2026-27, with an inflation guarantee, whereby the increase in pay for each year of the deal will be above the CPI inflation rate. Increments 4.3.3 4.3.4 There remains a fairly regular turnover of staff within posts and when this happens, the cost of increments can, in some cases, be absorbed within the existing budget provision, as leavers who may be at the top their grade may be replaced by new starts at the grade entry point. The cost of pay increments for 2025-26 is estimated at £0.599m. For future years, an equivalent cost has been assumed in the mid-range and worst case scenarios, while half the estimated 2025-26 cost has been assumed in the best case scenario. 4.3.5 Strathclyde Pension Fund As previously reported, the employer contribution rate paid to the Strathclyde Pension Fund fell from 19.3% to 6.5% in 2024-25 and 2025-26, rising to a sustainable long term rate of 17.5% from 2026-27. The reduction in the first 2 years equates to reduced costs of £6.875m per annum relating to Council employees (excluding HSCP). From 2026-27 the costs will rise again to 17.5% therefore this increase is required to be built into projections from 2026-27 onwards. Employee Costs Summary 4.3.6 The table below summarises the employee cost movements in the mid-range scenario for council services over the five years 2026-27 to 2030-31. The future years estimates have been further refined, following approval of the 2025-26 budget in February 2025. The employee cost increases relating to Social Work within the Health and Social Care Partnership are summarised within paragraph 4.6.3. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Pay Award 4,752 9,530 14,452 19,521 24,743 Full Year Effect 2025-26 Teachers Pay Award 496 496 496 496 496 Increments 599 1,198 1,797 2,396 2,995 Reinstatement of Strathclyde Pension Fund contribution 6,875 6,875 6,875 6,875 6,875 Total Employee Cost Changes 12,722 18,099 23,620 29,288 35,109 4.4 Non-Pay Inflation 4.4.1 Non-pay inflation is only provided for within budget plans, where it is deemed to be unavoidable, for example in respect of contractual obligations. As not all Page 17
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4.4.2 4.4.3 4.4.4 4.4.5 budget elements are subject to inflationary increases, inflationary budget pressures may arise in some other areas and in order to manage spend within available budget resources, service rationalisation or efficiencies may require to be delivered. Non-pay inflation assumptions within the mid-range scenario are based on current market forecast data, where available. Officers continue to review inflation assumptions on an ongoing basis. However, due to current market volatility and prevalent levels of uncertainty, at this stage, there has been no change to the inflationary assumptions included within the 2025-26 Budget Pack. The Budget Outlook provides for unavoidable non-pay inflation within each budget scenario. In addition, due to prevailing levels of economic uncertainty, it is deemed prudent to include a further general inflation contingency within the mid-range and worst case scenarios at £250k and £500k each year respectively. This contingency will either be required, reduced or removed to reflect changing circumstances before the 2026-27 budget is set. The estimated cumulative inflation over the five years 2026-27 to 2030-31 in the mid-range scenario is outlined in the table below. Non-Pay Inflation (Unavoidable) 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 2,745 5,632 8,676 11,890 15,140 An analysis of the 2026-27 cost estimate in respect of the mid-range scenario across key inflationary drivers is given in the table below. The non-pay inflationary increases relating to Social Work within the Health and Social Care Partnership are summarised within paragraph 4.6.3. Inflation Category 2026-27 Estimate £000 Premises and Utilities (Rates, Electricity, Gas, Oil, Water) 280 Waste/Landfill Tax 335 NPDO/HUB Schools 382 Other Contracted Services 883 Insurance 414 Other Supplies and Services 201 General Contingency 250 Total 2,745 4.5 Cost and Demand Pressures 4.5.1 For a number of years, services have been required to manage any cost and demand pressures within current budgetary resources, as far as possible. However, there are a number of cost and demand pressures, already identified Page 18
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4.5.2 for future years, which cannot be contained without a detrimental impact on service provision. These have continued to be reported within previous Budget Outlook reports and as part of the Revenue Budget Overview report presented at the Council budget meeting on 27 February 2025. Since the budget meeting on 27 February 2025, there have been no changes to the cost and demand pressures within the mid-range scenario. 4.5.3 When creating a longer term budget outlook beyond the current year, there is a greater risk that currently unforeseen or unquantifiable cost and demand pressures will emerge across future years. It is therefore deemed prudent to include a general contingency, proposed at £0.250m within the best case, £0.500m within the mid-range and £1m within the worst case scenarios year on year. This contingency will either be required, reduced or removed to reflect changing circumstances before the 2026-27 budget is set. 4.5.4 The cost and demand pressures within the mid-range scenario are detailed in Appendix 2 and summarised in the table below. These will be subject to ongoing review throughout the financial year. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 ASN Support 208 422 422 422 422 Election costs 0 350 0 0 0 Education ICT Network Infrastructure 0 53 53 53 53 Planning (Local Development Plan) 50 0 0 0 0 Universal Credit – HB Admin Grant 40 80 120 160 200 Civica Revenue and Benefits System 0 63 63 63 63 Compliance with BMW Ban 2,479 3,051 3,051 3,051 3,051 Bus Transport Contracts 268 268 268 268 268 Migration from Skype for Business to Teams Telephony 63 300 300 300 300 Valuation Joint Board Requisition 255 301 301 301 301 Allowance for pressures in future years 500 1,000 1,500 2,000 2,500 Total Cost and Demand Pressures 3,863 5,888 6,078 6,618 7,158 4.5.5 The cost and demand pressures relating to Social Work within the Health and Social Care Partnership are summarised within paragraph 4.6.3. 4.6 Health and Social Care Partnership 4.6.1 As part of the 2025-26 budget process, indicative base allocations of £85.045m were agreed for 2026-27 and 2027-28, with future years’ allocations being Page 19
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subject to Scottish Government grant funding and the council’s overall financial position. The indicative allocation for 2026-27 represents an increase of £3.053m, reflecting the non-recurring saving in relation to the Strathclyde Pension Fund contribution. 4.6.2 Political decisions will require to be made in respect of the allocation to the Health and Social Care Partnership in future years. For the purposes of the Budget Outlook, flat cash allocations, adjusted for the Strathclyde Pension Fund saving, have been assumed across all scenarios. These are only indicative planning assumptions and it will be a matter for Council to consider any changes, as part of the budget process next year. 4.6.3 Social Work services have already identified a number of cost and demand pressures, included within Appendix 3, with the mid-range scenario summarised below. These are included for information purposes. It is expected that the HSCP will absorb their cost and demand pressures within their funding allocation. Note that these only extend to three years rather than the five years of the council’s Budget Outlook. 2026-27 £000 2027-28 £000 2028-29 £000 Pay Inflation 1,232 2,501 3,809 Pay Increments 198 396 594 Non-Pay Inflation 771 1,570 2,403 Adult Care - Older People 500 1,000 1,500 Adult Care – Mental Health 50 100 150 Looked After Children 0 250 500 General Contingency 200 400 600 Total Estimated Cost Increases - Social Work Cumulative 2,951 6,217 9,556 4.6.4 4.6.5 In addition to the cost and demand pressures outlined above, there will be a further £3m budget pressure from 2026-27, arising from the non-recurring use of reserves, as a measure to balance the 2025-26 budget. This financial outlook is extremely challenging, particularly given that HSCP reserve balances are expected to be depleted by 31 March 2026. The council’s Section 95 Officer has sought a financial recovery plan from the IJB, under the terms of the Integration Scheme, seeking assurance in respect of its current and future financial position. There is a risk to the council in respect of failure to manage the delivery of Social Work services within available resources. Under the terms of the Integration Scheme, any overspend on Social Work services, which cannot be met from existing reserve balances, may fall to be met by the council. In order to safeguard the financial position of the council, the financial position of the HSCP and related financial risk to the council will be closely monitored throughout the year. This will form part of the regular reporting to Policy and Resources Committee in respect of the current year revenue budget monitoring and financial risks, as well as future iterations of this Budget Outlook report. Page 20
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4.7 LiveArgyll 4.7.1 Political decisions will require to be made in respect of the allocation to LiveArgyll in future years. For the purposes of the Budget Outlook, flat cash allocations have been assumed across all scenarios, with the exception of previous budget decisions in respect of the Strathclyde Pension Fund adjustment relating to the cessation of the one-off employer contribution rate saving (£0.118m increase) and deferral of the 2025-26 proposed saving in the service fee to 2026-27 (£311k reduction). These are only indicative planning assumptions and it will be a matter for Council to consider any changes, as part of the budget process next year. 4.8 Estimated Budget Gap PRIOR to Measures to Balance the Budget 4.8.1 The budget gap in the mid-range scenario over the five years 2026-27 to 2030- 31, after allowing for the considerations outlined above and prior to measures to balance the budget, is outlined in the table below. This is the budget gap prior to factoring in any previous savings decisions or potential options towards balancing the budget. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Base Budget 328,289 328,289 328,289 328,289 328,289 Base Budget Adjustments 75 75 75 75 75 Employee Cost Changes 12,722 18,099 23,620 29,288 35,109 Non-Pay Inflation 2,745 5,632 8,676 11,890 15,140 Cost and Demand Pressures 3,863 5,888 6,078 6,618 7,158 Adjustment to HSCP Payment re SPF Gain 3,053 3,053 3,053 3,053 3,053 Adjustment to LiveArgyll Payment (193) (193) (193) (193) (193) Total Estimated Net Expenditure 350,554 360,843 369,598 379,020 388,631 Estimated Funding 336,112 331,314 331,018 330,725 330,436 Estimated Budget Surplus / (Gap) Cumulative (14,442) (29,529) (38,580) (48,295) (58,195) 4.9 Measures to Balance the Budget 4.9.1 In 2025-26, a general inflationary increase of 6% was applied to relevant fees and charges. For the Budget Outlook, a range of between 3% (worst case) and 9% (best case), with a mid-range of 6% has been assumed each year over the five years 2026-27 to 2030-31. As a result of 2025-26 budget decisions taken by Council on 27 February 2025 to freeze fees on council-run ferries, the forecast income from fees and charges in future years has been slightly Page 21
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reduced. 4.9.2 Some of the management/operational and policy savings options agreed at the Council meeting on 27 February 2025 and in previous years will impact the 2026-27 and future years budgets. These are reflected within the Budget Outlook over the five years 2026-27 to 2030-31. 4.9.3 In terms of Council Tax, a 5% increase has been assumed each year in all scenarios. All councils increased their Council Tax by at least 6% for 2025-26, with 13 increasing their Council Tax by more than 10%. With a focus on longer term financial sustainability and in light of the significant forecast budget gap over the next five years, the level of Council Tax increases in 2026-27 and in future years will require due consideration by Members, as part of the budget setting for 2026-27 and future years. 4.9.4 The table below summarises the proposed measures to balance the budget in the mid-range scenario. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Fees and Charges Increase 382 787 1,217 1,672 2,155 Council Tax Increase 3,528 7,268 11,212 15,372 19,758 Management/Operational Savings (48) (9) (9) (9) (9) Policy Savings 1,012 1,748 2,217 2,331 2,465 Total Measures to Balance the Budget 4,874 9,794 14,637 19,366 24,349 4.10 Estimated Budget Gap AFTER Measures to Balance the Budget 4.10.1 The table below summarises the estimated budget gap in the mid-range scenario. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Estimated Budget Gap Prior to Measures to Balance Budget (14,442) (29,529) (38,580) (48,295) (58,195) Measures to Balance Budget 4,874 9,794 14,637 19,366 24,349 Estimated Budget Surplus / (Gap) Cumulative (9,568) (19,735) (23,943) (28,929) (33,846) Estimated Budget Surplus / (Gap) In Year (9,568) (10,167) (4,208) (4,986) (4,917) 4.10.2 In the mid-range scenario, the budget gap is estimated at £9.568m in 2026-27 and £33.846m over the five year period 2026-27 to 2030-31. Page 22
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4.10.3 The budget gap in the best case scenario is estimated at £6.068m in 2026-27 and £13.415m over five years, increasing to £16.159m in 2026-27 and £67.384m over five years in the worst case scenario. A summary of all three scenarios is included within Appendix 1. 4.10.4 The changes from the previous Budget Outlook in the mid-range scenario, reported to Council on 27 February 2025, are summarised in the table below. 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 Previously reported Budget Surplus / (Gap) Cumulative (9,588) (19,927) (24,316) (29,490) Adjustment to Council Tax 27 90 158 230 Adjustment to Employee Costs (4) 108 223 342 Adjustment to Fees and Charges (3) (6) (8) (11) Revised Budget Surplus / (Gap) Cumulative (9,568) (19,735) (23,943) (28,929) 5. CONCLUSION 5.1 In the mid-range scenario, the budget gap is estimated at £9.568m in 2026-27 and £33.846m over the five year period 2026-27 to 2030-31. Council officers are continuing to explore budget savings options during 2025-26 and these will be presented to Members in due course. 5.2 This is a very challenging Budget Outlook position. Variations to the assumptions in respect of future Scottish Government grant levels and pay awards would have a significant impact on the Budget Outlook. All assumptions will be kept under review, with the Budget Outlook updated, as and when further information becomes available. 6. IMPLICATIONS 6.1 Policy - Sets out the Budget Outlook that provides the financial envelope for policy decisions. 6.2 Financial - Sets best, worst and mid-range scenarios in respect of the Budget Outlook. The council are actively continuing to pursue opportunities to mitigate against future budget gaps. 6.3 Legal - None directly from this report but the Council requires to set a balanced budget. 6.4 HR - None directly from this report but there is a strong link between employee numbers and budgets. 6.5 Fairer Scotland Duty - 6.5.1 Equalities None directly from this report but any proposals to address the estimated budget gap will require to consider equality issues. 6.5.2 Socio Economic Duty None directly from this report but any proposals to Page 23
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address the estimated budget gap will require to consider socio economic issues. 6.5.3 Islands Duty None directly from this report but any proposals to address the estimated budget gap will require to consider any island specific issues. 6.6 Climate Change The Council is committed to addressing climate change and reviews how Services are delivering this on an ongoing basis, within the available budget resources. 6.7 Risk - None directly from this report but any proposals to address the estimated budget gap will require to consider risk. 6.8 6.9 Customer Service – The Rights of the Child (UNCRC) - None directly from this report but any proposals to address the estimated budget gap will require to consider customer service. None Kirsty Flanagan Executive Director/Section 95 Officer 14 April 2025 Councillor Ross Moreland, Policy Lead for Finance and Commercial Services APPENDICES: Appendix 1 – Budget Outlook - Best, Worst and Mid-range Scenarios Appendix 2 – Cost and Demand Pressures (Council Services) Appendix 3 – Cost and Demand Pressures (Social Work) For further information contact Carolyn Earl, Interim Head of Financial Services Carolyn.earl@argyll-bute.gov.uk Page 24
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BUDGET OUTLOOK 2026-27 to 2030-31 APPENDIX 1 Policy and Resources Committee - 8 May 2025 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Base Budget 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 328,289 Base Budget Adjustments 75 75 75 75 75 75 75 75 75 75 75 75 75 75 75 Revised Base Budget 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 328,364 Pay Award 4,752 9,530 12,811 16,158 19,572 4,752 9,530 14,452 19,521 24,743 7,919 16,041 24,570 33,525 42,928 Full year effect of 2025-26 pay award for teachers in 2026-27 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 Pay Increments 300 599 899 1,198 1,498 599 1,198 1,797 2,396 2,995 599 1,198 1,797 2,396 2,995 Re-instate Employers Superannuation Rate 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 6,875 Total Employee Cost Changes (Council Services) 12,423 17,500 21,081 24,727 28,441 12,722 18,099 23,620 29,288 35,109 15,889 24,610 33,738 43,292 53,294 Non-Pay Inflation - Council Services 1,771 4,011 6,381 8,893 11,871 2,745 5,632 8,676 11,890 15,140 3,692 7,259 11,012 14,968 18,968 ASN Support 208 422 422 422 422 208 422 422 422 422 208 422 422 422 422 Election Costs 0 327 0 0 0 0 350 0 0 0 0 370 0 0 0 Education ICT Network Infrastructure 0 53 53 53 53 0 53 53 53 53 0 53 53 53 53 Planning (Local Development Plan) 50 0 0 0 0 50 0 0 0 0 50 0 0 0 0 Housing Benefits Admin Grant 40 80 120 160 200 40 80 120 160 200 40 80 120 160 200 Civica Revenue and Benefits System 0 37 37 37 37 0 63 63 63 63 0 137 137 137 137 Compliance with BMW Ban 2,231 2,746 2,746 2,746 2,746 2,479 3,051 3,051 3,051 3,051 2,727 3,356 3,356 3,356 3,356 Bus Transport Contracts 268 268 268 268 268 268 268 268 268 268 268 268 268 268 268 Migration from Skype for Business to Teams Telephony 19 282 282 282 282 63 300 300 300 300 108 318 318 318 318 Valuation Joint Board 255 301 301 301 301 255 301 301 301 301 255 301 301 301 301 Allowance for Cost and Demand Pressures Future Years 250 500 750 1,000 1,250 500 1,000 1,500 2,000 2,500 1,000 2,000 3,000 4,000 5,000 Total Cost and Demand Pressures 3,321 5,016 4,979 5,269 5,559 3,863 5,888 6,078 6,618 7,158 4,656 7,305 7,975 9,015 10,055 Adjustment to Health and Social Care Partnership Payment 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 3,053 Adjustment to Live Argyll Management Fee (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) (193) Total Estimated Expenditure PRIOR to measures to balance the budget 348,739 357,751 363,665 370,113 377,095 350,554 360,843 369,598 379,020 388,631 355,461 370,398 383,949 398,499 413,541 Scottish Government Grant 262,366 263,021 263,678 264,337 264,997 261,058 260,406 259,755 259,106 258,459 259,749 257,801 255868 253,949 252,044 Packing Extended Producer Responsibility Funding - DEFRA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Transfer from Reserves - EPR funding carried forward from 2025-26 2,499 0 0 0 0 2,499 0 0 0 0 2,499 0 0 0 0 Transfer from Reserves - SPF Gain agreed February 2024 2,000 0 0 0 0 2,000 0 0 0 0 2,000 0 0 0 0 Council Tax 70,731 71,261 71,795 72,333 72,875 70,555 70,908 71,263 71,619 71,977 70,380 70,556 70,732 70,909 71,086 Total Funding 337,596 334,282 335,473 336,670 337,872 336,112 331,314 331,018 330,725 330,436 334,628 328,357 326,600 324,858 323,130 Budget Surplus / (Gap) PRIOR to measures to balance the budget (11,143) (23,469) (28,192) (33,443) (39,223) (14,442) (29,529) (38,580) (48,295) (58,195) (20,833) (42,041) (57,349) (73,641) (90,411) Measures to Balance the Budget: Fees and Charges 574 1,199 1,880 2,623 3,433 382 787 1,217 1,672 2,155 191 388 591 800 1,015 Council Tax Increase 3,537 7,277 11,231 15,409 19,823 3,528 7,250 11,176 15,316 19,681 3,519 7,223 11,121 15,223 19,538 Council Tax Increase (Growth element) 0 27 55 84 116 0 18 36 56 77 0 9 18 28 38 Policy Savings Agreed Feb 2023 476 1,112 1,581 1,695 1,809 476 1,112 1,581 1,695 1,809 476 1,112 1,581 1,695 1,809 NEW Management/Operational Options 2025 (48) (9) (9) (9) (9) (48) (9) (9) (9) (9) (48) (9) (9) (9) (9) NEW Policy Options 2025 536 636 636 636 636 536 636 636 636 636 536 636 636 636 636 Total Measures to Balance the Budget 5,075 10,242 15,374 20,438 25,808 4,874 9,794 14,637 19,366 24,349 4,674 9,359 13,938 18,373 23,027 Budget Surplus / (Gap) Cumulative AFTER measures to balance the budget (6,068) (13,227) (12,818) (13,005) (13,415) (9,568) (19,735) (23,943) (28,929) (33,846) (16,159) (32,682) (43,411) (55,268) (67,384) Budget Surplus / (Gap) In Year AFTER measures to balance the budget 0 (7,160) 410 (188) (410) (9,568) (10,167) (4,208) (4,986) (4,917) (16,159) (16,523) (10,729) (11,857) (12,116) Mid-Range ScenarioBest Case Scenario Worst Case Scenario Page 25
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COUNCIL COST AND DEMAND PRESSURES 2026-27 to 2030-31 Department Service Cost/Demand Pressure 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 2026-27 £000 2027-28 £000 2028-29 £000 2029-30 £000 2030-31 £000 Executive Director - Douglas Hendry Education The demand for ASN support in Argyll and Bute has continued to grow with a significant increase in, and early identification of children and young people presenting with complex additional support needs, including mental health difficulties which manifests often in dysregulated behaviours. IScottish Government statistics show that the number of pupils identified with ASN has increased markedly since 2010 and there continue to be year on year increases. These increases are likely due to continue as we see the impact of the Covid 19 pandemic on children and young people who were born from 2020 onwards and as we work with partners to streamline assessment processes which help us to understand need more thoroughly. Scottish Government statistical datasets show that the percentage of school roll in mainstream schools of pupils with ASN has increased by approximately 3% year on year. Within many authorities, this means increased numbers of children accessing specialist provision. As Argyll and Bute do not have equitable access to Specialist provision in all areas, the cost pressure associated with offering appropriate support within our local schools continues to increase in line with need. 208 422 422 422 422 208 422 422 422 422 208 422 422 422 422 Executive Director - Douglas Hendry Legal and Regulatory Services Estimated cost (to be borne by the Council) of carrying out local Government elections in May 2027 (and in financial year 2027/28). Operating approx. 100 polling stations and carrying out poll and count for 11 Multi member wards – requiring 11 separate counts 0 327 0 0 0 0 350 0 0 0 0 370 0 0 0 Executive Director - Douglas Hendry and Kirsty Flanagan Education and ICT The Education ICT Network requires a transformative technology upgrade in 2025-26 with improved security and reconfiguration to support in-school and at home learning. A cost pressure was agreed as part of the budget for 2025-26. There was an ongoing revenue requirement built into the cost pressure and this is expected to increase from 2027-28. 0 53 53 53 53 0 53 53 53 53 0 53 53 53 53 Executive Director - Kirsty Flanagan Development & Economic Growth Local development plan will require to be done under the new Planning legislation which is a revised process from the current one and will have a 10 year life. The new process has 2 stages where there is likely to be a cost pressure - a gate check followed by an examination some time later. 50 0 0 0 0 50 0 0 0 0 50 0 0 0 0 Executive Director - Kirsty Flanagan Financial Services Universal Credit “Full” Service went live in Sept 2018, managed migration for working age claimants began in August 2023 and will be completed by December 2025. Details of the migration of Pension age Housing Benefit claimants have not yet been released initial indications was that the overall migration to Pension Credit will be completed in 2028/2029 although that looks unlikely now. The DWP will reduce the Housing Benefit Administration Subsidy they pay to the Council as some claimants come off of Housing Benefit processed by Council staff and go onto Universal Credit processed by the DWP. The Council’s caseload has reduced since implementation of Universal Credit but it is hard to predict just how quickly the rest of the caseload will migrate from Housing Benefit to Universal Credit between now and 2028/2029. These figures represent our best estimates at this time. 40 80 120 160 200 40 80 120 160 200 40 80 120 160 200 Executive Director - Kirsty Flanagan Financial Services The Council has been engaged in discussions with the supplier of the Revenues and Benefits Management System and also the Electronic Document Management System. We expect cost increases in the future as the supplier moves the systems to the Cloud. The cost presure is an estimate at this time and will be refined as we get nearer to 2027-28. 0 37 37 37 37 0 63 63 63 63 0 137 137 137 137 Executive Director - Kirsty Flanagan Roads & Infrastructure Services Achieving compliance with ban on biodegradable municipal waste (BMW) which comes into place on 1 January 2026. The costs are the best estimates at this stage and consultants have assisted in producing the estimates. The best case and worst case scenarios are based on the mid-range with a +/- 10% change 2,231 2,746 2,746 2,746 2,746 2,479 3,051 3,051 3,051 3,051 2,727 3,356 3,356 3,356 3,356 Roads & Infrastructure Services Bus Transport contracts have seen a siginificant increase in new contract prices due to increased costs for fuel, insurance, maintenance, regualtory compliance and driver wages. New contracts have seen a combined annual increase of £975k across Argyll and Bute during 2024-25 with further contract renewals due in 2025-26. The cost pressure is the best estimate of future renewals and expected increases. An options appraisal is currently being carried out to assess the best and most cost effective solution for future delivery of the school and public transport service. 268 268 268 268 268 268 268 268 268 268 268 268 268 268 268 Executive Director - Kirsty Flanagan ICT Migration from Skype for Business to Teams Telephony to ensure those staff who need to make and receive external calls can do so. This was agreed at Policy & Resources Committee on 15 August. 19 282 282 282 282 63 300 300 300 300 108 318 318 318 318 Council Wide Council Wide A letter from the Dunbartonshire and Argyll and Bute Valuation Joint Board was received on 30 January 2025 advising of the financial challenges facing the Board and the estimated 2025-26 to 2027-28 budget gaps along with a request to increase the level of contribution that we make to the Board. Since 2012-13 the core constituent funding to the Board has either reduced or been flast cash for the past 7 years with the Board heavily reliant on reserves. As the reserves will be fully depleted by 2025-26 there is a required for the requisitions to increase. 255 301 301 301 301 255 301 301 301 301 255 301 301 301 301 Council Wide Council Wide General provision for unidentified Cost and Demand Pressures 250 500 750 1,000 1,250 500 1,000 1,500 2,000 2,500 1,000 2,000 3,000 4,000 5,000 TOTAL 3,321 5,016 4,979 5,269 5,559 3,863 5,888 6,078 6,618 7,158 4,656 7,305 7,975 9,015 10,055 Best Case Mid-Range Worst Case APPENDIX 2 Page 26
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SOCIAL WORK COST AND DEMAND PRESSURES - 2026-27 to 2028-29 APPENDIX 3 Service Cost/Demand Pressure 2026-27 £000 2027-28 £000 2028-29 £000 2026-27 £000 2027-28 £000 2028-29 £000 2026-27 £000 2027-28 £000 2028-29 £000 All Social Work Estimated Pay inflation reflecting a best case at 3% up to 2027/28 reflecting the Scottish Government Public Sector Pay Policy before reducing to 2% in 2028/29, a mid-range of 3% and a worst case of 5%. Adjusted for the impact of the increase in the employer's pension contribution rate from 6.5% to 17.5% in 2026/27. 1,232 2,501 3,373 1,232 2,501 3,809 2,054 4,210 6,474 All Social Work Estimated Pay increments, best case is that 50% of the incremental changes based on 2025/26 are absorbed and in the mid-range and worst case, the increase is in line with the increase in 2025/26. 99 198 297 198 396 594 198 396 594 All Social Work Inescapable non-pay inflation across a range of activities and activity specific inflation rates with a 0.5% tolerance for the best and worst cases. 541 1,102 1,680 681 1,388 2,126 817 1,675 2,577 All Social Work Non-pay inflation impact of payroll inflation on NHS posts which are recharged to Social Work. 75 151 230 90 182 277 104 213 325 Adult Care Older People Demand Growth: The number of older people is increasing and older people are living longer with significant health and support needs and significant expectations of the support they are entitled to receive. Best case assumes that this will be offset by efficiency improvement and increasing unmet need / demand. The mid range allows for a 1.5% increase each year. Worst case is 3% per year on the older adult services budget. 0 0 0 500 1,000 1,500 1,000 2,000 3,000 Adult Care Mental Health Demand Growth - As above, services operating within budget overall. The best case assumes a 0% increase in spending reflecting the limited service capacity in the area, the mid-range reflects 2% growth in 26/27 and 27/28 and the worst case reflects 3% growth. 0 0 0 50 100 150 75 150 225 Children and Families Looked After Children Demand Growth - there is a continuing demand for placements of children who are cared for by the HSCP. The best case scenario is that the expected additional demand can be funded from within existing resources as a result of planned improvements to the service delivery model (eg shift away from high cost external residential care to local foster and kinship care), the mid case reflects that additional demand in 26/27 be funded from existing resource with £250k per annum thereafter and the worst case reflects £250k per annum. 0 0 0 0 250 500 250 500 750 All Social Work Allowance for unknown cost and demand pressures which could arise. Per James Gow this is to reduce to £200k pa 0 0 0 200 400 600 200 400 600 TOTAL UNFUNDED COST AND DEMAND PRESSURES 1,947 3,952 5,580 2,951 6,217 9,556 4,698 9,544 14,545 Worst CaseMid RangeBest Case Page 27
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 HEALTH AND SOCIAL CARE PARTNERSHIP – FINANCIAL POSITION 1. EXECUTIVE SUMMARY 1.1 This report brings to the attention of Members, the current financial position of the Health and Social Care Partnership (HSCP) and the request for a recovery plan to be developed. 1.2 The Integrated Joint Board approved the HSCP budget for 2025-26 at their meeting on 26 March 2025. Social Work had a balance of £0.500m of savings still to be identified and Health had a gap of £4.2m as the HSCP were not able to identify the required 3% in NHS savings. 1.3 The gap in 2025-26 and opening gap in 2026-27 need to be addressed urgently and it is the intention of the HSCP that there is some overlap between short term recovery actions and the slightly longer-term requirement to reduce costs substantially. 1.4 The IJB Chief Officer and Chief Financial Officer are currently preparing a recovery plan which will be presented to the IJB at the end of May. Once the recovery plan has been approved by the IJB, it will then be submitted to the Council. 1.5 Should the recovery plan not be successful the Council may be faced with having to make interim funds available which would most likely have to come from the Council’s General Fund. 1.6 The HSCP position will be closely monitored during the year and updates provided to the Policy and Resources Committee via the regular budget monitoring pack. 1.7 It is recommended that the Policy and Resources Committee: a) Consider the content of this report. b) Note that a recovery plan is currently being prepared and will be presented to Council once it has been approved by the IJB. c) Note that a risk remains that the HSCP may revert to the Council for interim funds. Page 29 Agenda Item 5
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 HEALTH AND SOCIAL CARE PARTNERSHIP – FINANCIAL POSITION 2. INTRODUCTION 2.1 This report brings to the attention of Members, the current financial position of the Health and Social Care Partnership (HSCP) and the request for a recovery plan to be developed. 3. RECOMMENDATIONS 3.1 It is recommended that the Policy and Resources Committee: a) Consider the content of this report. b) Note that a recovery plan is currently being prepared and will be presented to Council once it has been approved by the IJB. c) Note that a risk remains that the HSCP may revert to the Council for interim funds. 4. DETAIL 4.1 The Health and Social Care sector across Scotland is in a difficult position at present due to the financial challenges they are facing. Most HSCPs have significant forecast deficits and depleted reserves. Audit Scotland have repeatedly reported that the sector is not operating on a financially sustainable basis. As reserves are reduced, service reduction is now required. The drivers of the financial challenges are: • Real terms reductions in funding over several years. • Increasing demand for services due to the ageing demographic. • On-going shortages of staff resulting in increased dependency upon agency staffing. 4.2 The Integrated Joint Board approved the HSCP budget for 2025-26 at their meeting on 26 March 2025. Social Work had a balance of £0.500m of savings still to be identified and Health had a gap of £4.2m as the HSCP were not able to identify the required 3% in NHS savings. 4.3 The £0.500m of unidentified savings in Social Work is in addition to £1.547m of identified savings planned for 2025-26. There remains a risk that the gap could increase if the agreed savings are not delivered or if costs and demand increases. One key risk relates to the increase in the employer National Insurance rate from 1 April 2025. Scottish Government provided 60% of the funding for employees directly employed by the Council, with the Council providing the remaining 40% of funding. The risk is in respect of commissioned Page 30
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providers and the HSCP estimate this could be in the region of £1.3m-£1.4m and strong representation has been made to the Scottish Government. 4.4 There is a larger funding gap from 2026-27 onwards due to almost £3m of non- recurring funding being used towards the 2025-26 budget. At the time of writing this report, the outturn for 2024-25 has not been finalised. 4.5 The gap in 2025-26 and opening gap in 2026-27 needs to be addressed urgently and it is the intention of the HSCP that there is some overlap between short term recovery actions and the slightly longer-term requirement to reduce costs substantially. 4.6 I am bringing the HSCP financial position to the attention of this Committee as the Scheme of Integration states “Any potential deviation from the planned outturn should be reported to the IJB, the Council and NHS Highland at the earliest opportunity”. The Scheme also states “Where it is forecast that an overspend will arise, then the Chief Officer and Chief Financial Officer of the IJB will identify the cause of the forecast overspend and prepare a recovery plan setting out how they propose to address the forecast overspend and return to a breakeven position. The Chief Officer and Chief Financial Officer of the IJB should consult the Section 95 Officer of the Council and the Director of Finance of NHS Highland in preparing the recovery plan. The recovery plan should be approved by the IJB. The report setting out the explanation of the forecast overspend and the recovery plan should also be submitted to the Council and NHS Highland.” 4.7 I have been liaising with the IJB Chief Officer and Chief Financial Officer and they are currently preparing a recovery plan which will be presented to the IJB at the end of May. Once the recovery plan has been approved by the IJB, it will be submitted to the Council. 4.8 Further savings cannot be delivered without reduction in service and capacity within the HSCP. Almost all social care services are provided to individuals with protected characteristics (children, older people, people with disability) and it is therefore not possible to reduce services without having a disproportionate adverse impact on these groups. The draft recovery plan includes increases to income, vacancy savings, review of services, application of a care ceiling and agency staff savings. These have still to be discussed and approved by the IJB. 4.9 The IJB Finance and Policy Committee have requested that the HSCP management team outline potential actions that could be expected to reduce spend at a pace and magnitude to address the future budget gap. Options are currently being explored, and it is welcomed that the Council has set aside £0.500m to assist with transformation and it is likely that this will be used to bring in external consultancy to provide challenge and identify opportunities for cost savings. Information will be provided to the Council as and when required. 4.10 As noted above, there remains a risk that the HSCP cannot bring its 2025-26 Page 31
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expenditure within budget. The Scheme of Integration states “Where recovery plans are unsuccessful and an overspend occurs at the financial year end, and there are insufficient reserves to meet the overspend, the Parties will consider making interim funds available. An analysis will be undertaken to determine the extent to which the overspends relate to either budgets delegated back to or activities managed by the Council or NHS Highland with the allocation of the interim funds being based on the outcome of this analysis. Any interim funds provided by the Council or NHS Highland will be repaid in future years based on a revised recovery plan agreed by both parent bodies, as required by either of the Parties. The NHS and Council will require to be satisfied that the recovery plan provides reasonable assurance that financial balance will be achieved.” 4.11 The risk to the Council is in respect of any Social Work overspend within the HSCP. The Council may be faced within having to make interim funds available which would most likely have to come from the Council’s General Fund. As reported to the Council in February, the unallocated General Fund balance is estimated to be less then £1m, although is subject to change as we finalise the 2024-25 year-end position. 4.12 The HSCP position will be closely monitored during the year and updates provided to the Policy and Resources Committee via the regular budget monitoring pack. 5. CONCLUSION 5.1 The HSCP is facing an extremely challenging financial position. The Integrated Joint Board approved the HSCP budget for 2025-26 at their meeting on 26 March 2025. Social Work had a balance of £0.500m of savings still to be identified and Health had a gap of £4.2m as the HSCP were not able to identify the required 3% in NHS savings. 5.2 The IJB Chief Officer and Chief Financial Officer are currently preparing a recovery plan which will be presented to the IJB at the end of May. Once the recovery plan has been approved by the IJB, it will then be submitted to the Council. Should the recovery plan not be successful the Council may be faced with having to make interim funds available which would most likely have to come from the Council’s General Fund. 5.3 The HSCP position will be closely monitored during the year and updates provided to the Policy and Resources Committee via the regular budget monitoring pack. 6. IMPLICATIONS 6.1 Policy - The Scheme of Integration sets out the financial arrangements for the IJB and partner bodies. 6.2 Financial - The HSCP are working on preparing a recovery plan for 2025-26 as there is £0.500m of unidentified savings in Social Work and a gap on £4.2m within Health. Page 32
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6.3 Legal - None directly from this report, when thee recovery plan is prepared it may have Legal issues to consider. 6.4 HR - None directly from this report, when the recovery plan is prepared it may have HR issues to consider. 6.5 Fairer Scotland Duty - 6.5.1 Equalities None directly from this report, when the recovery plan is prepared, it will require to consider equality issues. 6.5.2 Socio Economic Duty None directly from this report, when the recovery plan is prepared, it will require to consider equality issues. 6.5.3 Islands Duty None directly from this report, when the recovery plan is prepared, it will require to consider equality issues. 6.6 Climate Change The Council and HSCP is committed to addressing climate change and reviews how Services are delivering this on an ongoing basis, within the available budget resources. 6.7 Risk - There is a risk that the HSCP will revert to the Council for an interim fund payment if there is an overspend at the year end. 6.8 6.9 Customer Service – The Rights of the Child (UNCRC) - None directly from this report, when the recovery plan is prepared, it will require to consider customer service. None Kirsty Flanagan Executive Director/Section 95 Officer 16 April 2025 Councillor Ross Moreland, Policy Lead for Finance and Commercial Services Councillor Dougie McFadzean, Policy Lead for Care Services Page 33
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 EMPTY PROPERTY RELIEF FOR BUSINESSES – POLICY UPDATE 1.0 EXECUTIVE SUMMARY 1.1 From 1 April 2023, the administration of Empty Property Relief (EPR) in Non- Domestic Rates (NDR) was devolved to Scottish local authorities. Argyll and Bute Council receives £608,000 annually for three years to manage EPR locally. 1.2 While new policy changes in 2024/25 reduced the Council’s EPR expenditure significantly, the number of empty business properties has continued to rise, reaching 332 by February 2025. 1.3 To address challenges and better support economic regeneration, this report recommends two policy amendments: • Introduction of a targeted discretionary extension of up to 12 months of 100% EPR for owners actively renovating empty properties to bring them back into use. • Restriction of EPR eligibility for large businesses with cumulative rateable property values exceeding £1 million. 1.4 These amendments are designed to make best use of devolved EPR funding by encouraging property reuse, supporting local business owners, and ensuring relief is not disproportionately allocated to large corporations. Page 35 Agenda Item 6
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 8 MAY 2025 EMPTY PROPERTY RELIEF FOR BUSINESSES – POLICY UPDATE 2.0 INTRODUCTION 2.1 Following devolved powers granted by the Scottish Government from 1 April 2023, Argyll and Bute Council assumed control over the administration of EPR, with a dedicated budget of £608,000 per annum for three years. 2.2 In 2023/24, the Council operated EPR under the legacy Scottish Government rules and incurred £758,000 in costs across 316 properties, resulting in an overspend in the year. 2.3 To improve sustainability, a revised EPR policy was introduced in 2024/25 which reduces relief over time, encouraging reoccupation of properties. 2.4 Despite lowering projected EPR spend to £254,000 in 2024/25 and an anticipated £62,000 in 2025/26, the number of empty properties increased to 332. This report proposes two strategic amendments to enhance the impact of the EPR policy and provide more targeted business support. 3.0 RECOMMENDATIONS 3.1 Policy and Resources Committee is requested to approve the following policy amendments; i) Introduction of a discretionary 100% EPR extension of up to 12 months. Officers will have the discretion to apply an additional one-year (or lesser period) of 100% relief for property owners with genuine, evidenced renovation projects. Eligibility will be based on clear criteria and subject to regular review. ii) Restriction of EPR eligibility for large multinational businesses. A threshold will be introduced where businesses with empty properties exceeding a cumulative rateable value of £1,000,000 are ineligible for EPR. 3.2 Policy and Resources Committee is further requested to approve that both policy amendments be implemented with immediate effect. 4.0 DETAIL Proposed Policy Amendment 1: Enhanced Support for Renovation Projects 4.1 Under current policy, empty properties receive: • 50% relief for 3 months, Page 36
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• 10% for 9 months, • 0% thereafter. 4.2 The proposed amendment introduces flexibility for property owners actively working to bring properties back into use. Specifically, owners can apply for up to 12 months of 100% relief at any time after the property becomes vacant, provided: • Planning and building consents are secured; • A detailed renovation schedule is submitted; • Photographic evidence confirms works have commenced; • The Council’s Empty Business Property Officer is granted access for inspections. 4.3 Applications can be made at any time, whether during the initial relief period or once the property has already moved into full liability and no relief applies. If approved, the enhanced relief is awarded for a maximum of 12 months. There are no further extensions. 4.4 Relief may be awarded on a phased basis (e.g., 3, 6, or 9 months), with officers conducting regular 3-month reviews to confirm progress. Should progress stall, officers retain the discretion to withdraw relief. 4.5 This approach ensures that support is targeted at owners making active, genuine efforts, prevents misuse of relief, and maintains a clear incentive to complete renovation works promptly. Example of Proposed Policy Amendment 1 4.6 A former hotel in Argyll and Bute, vacant since 2010 and with listed building status, has secured full planning and building consents. Under the current scheme, the owner faces NDR charges of £6,800 in 2024/25 and £8,500 in 2025/26. 4.7 With the proposed amendment, the owner could apply for enhanced relief once works commence (for example, from 1 June 2025). If approved, they would receive 100% relief for up to 12 months, enabling circa £8,500 of funding to be redirected to completing renovations, bringing a key community asset back into use. 4.8 If the works are not completed by the end of the enhanced relief period (for example, by 31 May 2026), the relief will cease, and full Non-Domestic Rates (NDR) liability will apply. This approach provides the property owner with a clear and fixed timeline for completion, offering both an incentive to finalise works within the agreed period and the reassurance of avoiding NDR charges during the costly renovation phase. Page 37
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4.9 It also creates a clear framework for the Empty Property Officer to reinforce at each of their scheduled three-monthly inspections, ensuring that owners remain focused on completion milestones throughout the duration of the relief period. Relief Flow Table: Current and Proposed Relief Stage Current Relief Policy Proposed Enhanced Discretionary Relief Policy (For Eligible Renovation Projects) Conditions of Award (Consents secured, works commenced) Not Met Met Date property becomes empty 0-3 months 50% relief Current policy applies (all stages) 100% Empty Property Relief available for a maximum of 12 months (commencing date conditions met) during 24 month period 4–12 months 10% relief 12-24 months 0% relief ongoing Post-24 months Not applicable 0% relief ongoing Note: Enhanced relief is available flexibly, aligned with project readiness rather than fixed time periods. Proposed Policy Amendment 2: Restriction of EPR eligibility for very large businesses. 4.10 A small number of large multinational businesses own-high value business properties in Argyll and Bute. If these become vacant and the owners claim EPR a large portion of available funds could be consumed. 4.11 Under the current policy the large multinational businesses would be eligible for EPR diverting much needed funds away from smaller local businesses. 4.12 The proposed amendment introduces a £1,000,000 cumulative rateable value threshold for EPR eligibility. Page 38
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Example of Proposed Policy Amendment 2 4.13 A multinational with properties that have a combined rateable value of £2.5 million operations. If granted EPR as part of the current policy they could receive £286,500 in relief, 48% of the Council’s total EPR fund. Excluding such cases prioritises support for local regeneration. Property Analysis and Trends 4.14 The table below shows the trends in EPR by category since the new policy has been introduced; 4.15 Recent analysis shows an increase in properties receiving both Listed Building and Standard EPR: • Standard category: up by 40 (from 229 to 269); • Listed category: up by 13 (from 25 to 38). 4.16 Notably, properties with a rateable value under £1,700 have declined from 63 to 25, indicating success in discouraging prolonged vacancy in lower-value properties. 4.17 While the overall number of EPR recipients has increased, total value of relief awarded has fallen significantly: • From £758,362 in August 2023 • To £253,747 in March 2025 Aug-23 Mar-25 Difference Aug-23 Mar-25 Difference Listed Building 100% 0% 46 73 27 330,884 72,738 258,146 Insolvency 100% 0% 2 5 3 285,300 95,859 189,441 Rateable Value Less Than £1700 100% 0% 155 90 -65 56,470 6,315 50,155 Standard Empty Property Relief 50% for 3 months 10% thereafter 50% for 3 months 90% thereafter 103 148 45 48,865 69,394 -20,529 Ratepayer Deceased 100% 0% 6 6 0 17,172 3,514 13,658 Ground – On Valuation Roll 100% 0% 4 6 2 15,886 3,290 12,596 Occupation Prohibited By Law 100% 0% 1 2 1 3,785 1,730 2,055 Industrial Property 100% for 6 months 10% thereafter 0% for 6 months 90% thereafter 0 2 2 0 906 -906 TOTAL 317 332 15 758,362 253,747 504,615 Type of Empty Property Relief EPR Relief EPR Charge No of Subjects Total Value of EPR (£) Page 39
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4.18 The appointment of the Empty Business Property Officer in December 2024 has supported this progress, enhancing engagement with property owners and setting up a structured Business Grant Scheme. 4.19 Some figures are skewed by a single ratepayer in Campbeltown owning 19 empty storage units, and there has been a rise in Standard EPR recipients, particularly among shops and offices — concerning due to their importance to local economies. These properties are being prioritised within the grant scheme. 5.0 CONCLUSION 5.1 While the current policy has reduced overall expenditure, the number of empty properties has increased. Targeted, evidence-based support is required to encourage reoccupation and regeneration. 5.2 Approval of the proposed amendments will: • Align EPR with economic regeneration goals; • Encourage timely reoccupation of vacant properties; • Protect public funds from disproportionate claims by large businesses. 5.3 Combined with the structured business grant scheme, these changes provide a robust platform for revitalising communities across Argyll and Bute . 6.0 IMPLICATIONS 6.1 Policy - The proposed amendments represent a refinement of the Council’s current EPR policy, providing additional flexibility to support economic regeneration while continuing to encourage the reuse of empty properties. Approval will enable more targeted use of EPR funding aligned with Council priorities. 6.2 Financial - The changes will help manage EPR expenditure within the allocated £608,000 annual budget by: • Reducing potential high-value claims from large multinational property owners. • Allowing freed-up funds to be redirected toward structured business support grants. • Supporting long-term financial sustainability of the EPR scheme. Any minor system adjustment costs are expected to be absorbed within existing budgets. 6.3 Legal - The Council has discretion under devolved powers to apply and amend EPR policy locally. 6.4 HR - There are no additional HR implications. The existing Empty Business Property Officer will continue to deliver and monitor the amended policy within current resources and be supported by the NDR team in doing so. Page 40
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6.5 Fairer Scotland Duty: 6.5.1 Equalities - There are no direct equalities impacts. The discretionary relief process will be applied fairly and consistently, with appropriate checks and balances in place. 6.5.2 Socio-economic Duty - The amendments are expected to positively impact socio-economic inequality by: • Supporting local business owners and communities to bring vacant premises back into use. • Prioritising funding to projects that support economic regeneration in fragile town centres. 6.5.3 Islands - The amendments will be applied across Argyll and Bute, including island communities. The discretionary nature of the support allows for local context and barriers to be considered and allows tailored support for island based projects. 6.6 Climate Change - By supporting the reuse and renovation of existing buildings, the policy encourages sustainable development and may help reduce the need for new-build developments. 6.7 Risk - Key risks include: • Misuse of discretionary relief if not effectively monitored. • Potential negative feedback from large multinational businesses no longer eligible for EPR. • Mitigations include clear eligibility criteria, ongoing monitoring by officers, and transparency in decision-making. 6.8 Customer Service - The amendments improve the Council’s responsiveness to property owners who are committed to bringing buildings back into use. Streamlined application processes and officer engagement will support better outcomes for customers. 6.9 The Rights of the Child (UNCRC) - There are no direct implications under the UNCRC. However, returning vacant properties to use may contribute indirectly to stronger local economies and community resilience, benefiting families and children. Kirsty Flanagan, Executive Director with responsibility for Finance Policy Lead Councillor Ross Moreland 27 March 2025 For further details or discussion, please contact; Fergus Walker, Revenues and Benefits Manager, Financial Services. Fergus.walker@argyll-bute.gov.uk Fergus Murray, Head of Development and Economic Growth Fergus.murray@argyll-bute.gov.uk Page 41
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 CORPORATE PLAN 2025 - 2027 1.0 INTRODUCTION 1.1 This report introduces the new Corporate Plan 2025 – 2027 which the Policy and Resources Committee is asked to consider and approve for onward transmission to Council. 2.0 RECOMMENDATIONS 2.1 The Policy and Resources Committee is asked to approve the new Corporate Plan, which contains the new Council Priorities, for onward transmission to the Council. 3.0 DETAIL 3.1 Members agreed revised strategic priorities at the Council meeting in September 2024. Those priorities replace the ones outlined in the previous Corporate Plan for 2023 – 2027 and can be found on the Council website here Priorities of Argyll and Bute Council | Argyll and Bute Council. 3.2 An updated Corporate Plan has now been developed to cover the remainder of the Council term to 2027 and includes these new priorities. 3.4 In the recently published Best Value Audit of the Council, the Accounts Commission recognised that since the change in Administration in 2024, they recognise that the Council now has many critical pieces of work in the pipeline. One of those is identified as the new Corporate Plan. This new Plan seeks to set the strategic direction for the Council, which will allow the Council to ensure financial sustainability as well as meeting the needs of service users across Argyll and Bute. 3.5 The new Plan maintains a clarity of vision, keeping the focus on the long term, sustainable future of the area in terms of population and economy. Population continues to be a challenge for our area, as we can see from the projected long-term decline. But it is important to remind ourselves that in 2012, the NRS projected that by 2022 our population would drop to 82,753. This did not happen, and our actual census position in 2022 was 87,810. Maintaining our Page 43 Agenda Item 7
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focus is essential to turning this projected trend around and provides clarity for the alignment by all supporting strategies and policies. 3.6 The new Corporate Plan will be underpinned by more streamlined and focused performance reporting and the development of Key Performance Indicators to drive continuous improvement. Members will be aware of the ongoing Performance Excellence project, reported on regularly to the Audit and Scrutiny Committee, which sets the direction for delivering on this action. 4.0 CONCLUSION 4.1 A new Corporate Plan is now presented to the Policy and Resources Committee Council incorporating priorities agreed in September 2024 for approval. This sets the overall strategic framework for Council activities and is part of our overall Corporate Planning, Performance and Improvement Framework. It is a critical piece of work identified by the Accounts Commission and maintains clarity of vision for the long term future of council services for our communities. 5.0 IMPLICATIONS 5.1 Policy: The Corporate Plan sets out the strategic policy framework for the Council. 5.2 Financial: The Corporate Plan sets out the priorities and strategic direction of the Council which is important for ensuring financial stability. 5.3 Legal: The Corporate Plan is a critical document in ensuring that the Council delivers on its statutory duty of Best Value. 5.4 HR: None arising directly from this report. 5.5 Fairer Scotland Duty: An Integrated Impact Assessment for the Corporate Plan will be available on the Council website. 5.5.1 Equalities - protected characteristics: none arising directly from this report. 5.5.2 Socio-economic Duty: none arising directly from this report. 5.5.3 Islands: none arising directly from this report. 5.6 Climate Change: None arising directly from this report. 5.7 Risk: The new Corporate Plan mitigated the risk of failure to deliver on the agreed priorities of the Council. Page 44
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5.8 Customer Service: None arising directly from this report. 5.9 The Rights of the None arising directly from this report. Child (UNCRC): Pippa Milne, Chief Executive Council Leader, Jim Lynch April 2025 For further information contact: Jane Fowler, Head of Customer Support Service, jane.fowler@argyll-bute.gov.uk Carolyn Cairns, HROD Manager carolyn.cairns@argyll-bute.gov.uk Appendices Appendix 1: Corporate Plan 2025 – 2027 Page 45
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Classification: OFFICIAL #abpla ce2b Bute • Helensburgh • Islay • Oban • Mull • Campbeltown • Iona • Dunoon • Tiree • Lochgilphead • Seil … Corporate Plan 2025 - 2027 Page 47
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 2 Classification: OFFICIAL Contents 1. WELCOME ........................................................................................... 3 2. OUR PROFILE ...................................................................................... 4 3. OUR STRATEGIC FRAMEWORK ........................................................ 5 4. OUR VISION ......................................................................................... 6 5. OUR PRIORITIES ................................................................................. 7 PRIORITY: COMMUNITIES .................................................................. 9 PRIORITY: CHILDREN AND YOUNG PEOPLE .................................. 10 PRIORITY: HOUSING, ECONOMIC GROWTH AND POPULATION .......................................................... 11 PRIORITY: TRANSPORT, INFRASTRUCTURE AND DIGITAL CONNECTIVITY ........................................ 14 PRIORITY: ENVIRONMENT ............................................................... 16 PRIORITY: SUSTAINABLE SERVICE DELIVERY .............................. 16 PRIORITY: SPEAKING UP FOR ARGYLL AND BUTE ........................ 18 6. OUR CHALLENGES AND RISKS ...................................................... 19 7. OUR SUCCESS MEASURES ............................................................. 21 Page 48
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 3 Classification: OFFICIAL 1. Welcome We are delighted to introduce our Corporate Plan, which outlines our vision and strategic direction for the coming years. The landscape in which we deliver our services is constantly evolving and we will adapt and innovate to meet the needs of our communities and ensure the prosperity of our area. The considerable challenges we identified in our previous corporate plan remain unchanged; declining funding, economic dependence on the public sector, and an ageing population are ever present however we remain steadfast in our mission. Our Corporate Plan focuses on key priorities for the next three years, with detailed actions and progress measures outlined in our Annual Business Plan. As we embark on this transformative journey, it is crucial that we remain adaptable and responsive to the evolving needs and challenges of our time. Our corporate plan serves as a compass, guiding our decision-making processes and ensuring that our efforts are aligned with our strategic objectives, with our communities at its heart. This plan details our commitment to attracting and retaining talented individuals, fostering a positive employee experience, and cultivating a culture of unity and innovation within our council. Our aim is to build a thriving, inclusive, and forward- thinking environment that benefits everyone. Our success is built on collaboration and community engagement, forging strong partnerships and actively involving local communities is key to our success. We value the diverse perspectives and expertise within our community, and through meaningful dialogue and cooperation, we can build a brighter future together. We are committed to delivering high-quality services, enhancing infrastructure, and nurturing a vibrant economy that creates opportunities for all. Councillor Jim Lynch Leader of Argyll and Bute Council Pippa Milne Chief Executive Page 49
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 4 Classification: OFFICIAL 2. Our Profile Page 50
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 5 Classification: OFFICIAL 3. Our Strategic Framework This plan sets the strategic direction for the council, highlighting our key corporate priorities and deliverables for the period until 2027. Our Corporate plan is part of a portfolio of documents that make up our planning framework at corporate level and is the overarching document for our wider Performance and Improvement framework. Our corporate plan shows how our corporate priorities will contribute to the overall shared vision for our area agreed with our community planning partners, in the Argyll and Bute Outcome Improvement plan 2024-2034 (ABOIP). In addition to our corporate priorities the Council has several strategic objectives, statutory duties and responsibilities. Together, these all ensure that we have financial sustainability and meet the needs of service users across Argyll and Bute. Our annual business plan is where we set out deliverables and monitor performance against these strategic outcomes. Our business 2025-26 plan will be completed and approved following adoption of this corporate plan. At team planning level, we identify core service standards and key operational deliverables. We are transforming our approach to Performance and Improvement activities, reviewing our Performance and Improvement Framework, and redesigning elements of it to better reflect out Connect for Success principles and modern ways of working. Our Golden Thread Page 51
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 6 Classification: OFFICIAL 4. Our Vision Vibrant and empowered communities, thriving economy, and positive partnerships are core components of our vision for Argyll and Bute. The ongoing impact of the cost-of-living crisis, housing emergency, predicted population decline and reducing public sector finances are significant challenges we must navigate on the road to achieving our vision for a thriving Argyll and Bute. We will build on our track record of success to achieve the change we want to see for our area. Vibrant and Empowered Communities Our vision is for an Argyll and Bute where communities feel listened to, are part of decision making and are empowered to deliver locally tailored projects and services with the support and facilitation of the council as their trusted partner. Where we deliver services, we want to be recognised for consistently delivering impactful results. We have recently designed and launched an engagement toolkit and undertaken several public engagement events. We will use learning from these to continue building positive relationships and partnerships with our communities. Thriving Economy Our vision is for an Argyll and Bute where businesses are thriving, serving the needs of visitors and locals, and providing quality local products and employment opportunities. Improved access to quality and affordable housing supports our thriving economy and helps to grow our population. Positive Partnerships The key to a successful and thriving Argyll and Bute lies in the relationships and partnerships that we develop within and out with our area. Overcoming the challenges we face in achieving our vision of a thriving Argyll and Bute will take teamwork and collaboration with many partners. We will continue to collaborate positively with central government, communities and other partners to ensure the needs and voices of Argyll and Bute are well articulated and understood We have a vision for a successful, vibrant Argyll and Bute with a growing population and a thriving economy. A place where communities and businesses thrive and people want to come to live, to work and to do business. Page 52
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 7 Classification: OFFICIAL 5. Our Priorities We have seven corporate priorities that will shape our policy and decision making over the life of this plan. To deliver on these priorities and overcome the challenges we face, the Council must continue to transform at pace, building on our long-standing culture of innovation and use of digital technology. Our strategic approach to transformation will be underpinned by the principles of Connect for Success: Page 53
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 8 Classification: OFFICIAL Page 54
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 9 Classification: OFFICIAL Empowered and resilient communities – Our communities are as diverse as our geography and have varying needs, challenges, and opportunities – all of which they are well placed to identify. We want to harness that local knowledge with confidence and work together to develop shared priorities. This priority directly aligns with the Community Wellbeing theme in the ABIOP and will help us to contribute to this shared plan. To strengthen our collaboration and support for our communities, we will: Priority Next Steps / Action Build stronger connections and collaborations with communities to increase empowerment and make the best use of local knowledge to help shape delivery of local solutions Meeting people where they live – progressing an engagement programme for senior leadership across and around local communities Enhance and deepen our understanding of local issues and improve opportunities for collaboration – including launch of the Aspiring Places: Community Projects programme in Argyll and Bute Use online tools/digital platforms to find ways to reach those not in established groups and start ongoing conversations about local issues Take forward a piece of work to support Area Committees to reshape their business, decision-making and overall activities to align with existing/emerging local plans and issues, following agreement of Priorities Once Priorities agreed by Council – Area Committee Chairs to have initial discussion and feed back views to political leadership as first action Reaffirm our commitment to refugee resettlement, valuing the contribution that new families and residents make to life in Argyll and Bute Ensure that our approach to refugee resettlement has regard to the availability of housing, employment and skills locally while being delivered through national funding scheme COMMUNITIES Page 55
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 10 Classification: OFFICIAL Making Argyll and Bute an attractive choice for families – Giving young people the best start in life, and ensuring we have the right skills for a prosperous future, are key elements of making Argyll and Bute an ideal choice for families to stay or to relocate. The Argyll and lifestyle already has much to offer and, to play our part in making that more attractive, we will: Priority Next Steps / Action Develop our school curriculums with the jobs of the future in mind, to build up a strong local skills base and help create more opportunities for young people to stay and grow in their own communities. Look at data from across the Council to identify skills, service delivery and employment needs locally – to shape learning opportunities for the short and medium term which contribute to overall population and economic growth. Enabling as many young people as possible go from school to positive destinations of all kinds. Work with partners on local further and higher education provision and apprenticeship opportunities that meet identified skills, service delivery and employment needs. Explore ways to enhance Argyll and Bute’s early learning and childcare offer to support employment and business needs of local families alongside its role in nurture and contribution to access to better life chances for young people. Identify measures to increase provision with partners. Enable learners to take full advantage of emerging technology and to be ready for the ‘jobs of the future’ here in Argyll and Bute. Pursue opportunities for investment in schools digital network – 21st century digital network for schools and wider education infrastructure. United Nations Convention of the Rights of the Child (UNCRC) – ensuring that views of children and young people are considered in decision making. Developing our organisational culture to be receptive to the views of children and young people in our decision- making CHILDREN AND YOUNG PEOPLE Page 56
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 11 Classification: OFFICIAL Continue the programme of improvement in our schools so that they are a compelling choice for families, providing good educational attainment and supporting the wellbeing of young people. Explore options for Education Review. Working to ensure that everyone who needs a home can find one that they can afford, in the right place, and at the right time – Access to housing is a factor in almost every aspect of Argyll and Bute’s crucial growth agenda. It contributes to the success of economic development, recruitment, employment opportunities, service delivery and much more. Argyll and Bute was the first Council in Scotland to declare a Housing Emergency. We must increase pace and be agile, ready to innovate and prepared to do things differently in order to see swift progress. Shared prosperity and sustainable business growth in Argyll and Bute – We value the impact and return on investment that effective, targeted economic development can have. We recognise that all kinds of resources are increasingly limited and must be used to deliver shared prosperity, sustainable business growth and the best possible outcomes for Argyll and Bute. People are Argyll and Bute’s most important asset in driving forward opportunities for growth and vibrant local economies – Population growth is crucial to our economic success. Decline impacts on our ability to sustain and deliver services in the future. There is a predicted drop of 14.8% between 2018 and 2043, mainly in the 25 to 44 age group. We have a relatively tight labour market, arising from consistently higher levels of participation and low unemployment, with critical gaps in public services and key business sectors like hospitality and construction. This has been exacerbated in recent years by a decline in the working-age population, migration limitations and higher levels of economic inactivity particularly in the over-50s age group. This priority directly aligns with the Housing theme in the ABIOP and will help us to contribute to this shared plan. HOUSING, ECONOMIC GROWTH AND POPULATION Page 57
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 12 Classification: OFFICIAL We will: Priority Next Steps / Action Sharpen focus on the Housing Emergency Action Plan and other plans/delivery bodies as appropriate in line with the pace required in emergency. Refresh and update our Local Housing Strategy. Use policy and fiscal levers at our disposal to speed up delivery – lobby other agencies where required. Seek reform or flexibility on use of Resource Planning Assumption (RPA). Looking at overarching plans – Argyll and Bute Local Housing Strategy Strategic Housing Investment Plan Local Development Plan Oban and Helensburgh Development Masterplans Using latest data to reframe and target activities and resources to the right places at the right times. Revisit Strategic Housing Fund. Examine scope to reduce time spent in temporary accommodation. Lobbying work Drive forward in partnership across all sectors to deliver on vital areas like key worker accommodation, mid-market rentals, private sector development in addition to activity on affordable homes. Engagement and partnership working across all sectors. Local Housing Strategy review to open up greater opportunities for partnership working and securing additional resources to support swifter delivery. Housing Emergency Action Plan. Explore scope for greater commercialisation of Council assets and otherwise attract external investment for the Council and communities. Build on the existing foundations to derive further commercial income from Council assets. Explore opportunities for Community Partnerships to divest/operate Council assets. Further develop the approach to community Benefits and the opportunities from planning gain for communities to augment Council funding. Page 58
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 13 Classification: OFFICIAL Take a clear ‘return on investment’ approach to allocations of resources at all levels – prioritise action that brings people, jobs and business to Argyll and Bute through Maximising community benefit opportunities from local development and promote community wealth building. Agree refreshed Economic Strategies. Development Masterplans. Critical evaluation of activities, financial allocations and requests and how those will translate into employment or growth. Use policy and fiscal levers in our power to stimulate, attract and incentivise growth – for example exploring creation of enterprise zones. Where power to drive growth sits with other agencies, lobby for support to complement the actions we are taking and investments we are making (e.g. fuel, transport costs in rural areas) Engage with Argyll and Bute’s key sectors and major employers in food and drink, tourism, construction, energy and social care to progress shared priorities and work in partnership where possible. Continue to lead on bringing depopulation to national government attention. Bringing together group of depopulating local authorities to act together as collective voice. Engage with Scottish Ministers and Ministerial Taskforce. Page 59
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 14 Classification: OFFICIAL Keeping people, businesses, goods and services moving through Argyll and Bute – Argyll and Bute’s geographic mix of rural and island communities mean that transport, infrastructure and digital connectivity are crucial jigsaw pieces in the drive for growth. At the most basic level, we need effective and reliable ways to bring people, goods and services to Argyll and Bute – and to carry our own products. Like transport connectivity, reliable, resilient digital links have a highly significant contribution to make to growing the population and the economy. They can add considerable value to Argyll and Bute’s position as an ideal choice to locate, offering an attractive lifestyle and opportunities to learn, work and do business. In the same context we need to consider the impact of climate change on that essential infrastructure. This particular area is complex given our geography and the range of agencies who have responsibility for maintaining the resilience of lifeline connections of all kinds. Our principles of return on investment, partnership working, and speaking up for Argyll and Bute and its people will all come into play here. This priority directly relates to the Transport Infrastructure theme in the ABIOP and will help us to contribute to this shared plan. We will: Priority Next Steps / Action Lobbying for national infrastructure investment and interventions where responsibility lies with other agencies – maintaining pressure for delivery at pace of the permanent solution for the A83 Rest and Be Thankful. Political lobbying for urgent action on ferry services which brings the capacity and timetabling needed to support lifeline links and routes to market. Establish political lobbying group (which will tackle a variety of issues), agree membership and scope. Agree themes/focus of political lobbying activity – including A83, Rest and Be Thankful, A82 upgrade, A85 improvements. Constructive engagement with Scottish and UK Government Ministers. TRANSPORT, INFRASTRUCTURE AND DIGITAL CONNECTIVITY Page 60
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 15 Classification: OFFICIAL Representing to industry and national governments on disproportionate transport, fuel and energy costs which contribute to higher rural poverty/deprivation levels and impact on growth. Find ways to join our voice with those of communities who tell us this is a priority for them too. Seek full funding for delivery of internal ferry services, given that responsibility for these sits with Transport Scotland Pursue formal request for full funding, noting previous shortfall. Use strong data to develop a Transport Strategy which recognises the significance of connectivity to population and economic growth. Explore options for full transport study (which can include looking at integration, organisation options) following RIS Review. Page 61
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 16 Classification: OFFICIAL We recognise that climate change represents one of the most significant challenges facing our communities today and in the future. Argyll and Bute Council has demonstrated our commitment through tangible progress, having reduced our carbon emissions by 31% over the past 8 years through sustained investment in energy efficiency and carbon reduction initiatives. We remain firmly committed to driving down our carbon footprint further, with a clear target of achieving net zero emissions by 2045, aligned with Scottish Government climate objectives. Our interim targets ensure we maintain momentum and accountability throughout this journey. The Council is building on this foundation through ongoing decarbonisation efforts across our estate, transition to electric vehicles, renewable energy development, and integration of climate considerations across all service areas. We acknowledge that addressing climate change requires collective action. Argyll and Bute Council works collaboratively with the Community Planning Partnership to develop and implement region-wide climate initiatives that support communities, businesses, and organisations in making their own transition to a low-carbon future. Through this coordinated approach, we aim to transform our local economy through a just transition to deliver a sustainable, resilient, and net zero Argyll and Bute for current and future generations. We will: • Reduce carbon emissions generated by the Council. • Agree policies in relation to waste, recycling and other environmental issues, which will inform next steps. • Evaluate Council targets for deliverability and improvement. • Harness opportunities from expansion of renewable energy sector in the area. We want to provide the best services we can for the money and resources available and make clear the standards that our communities can expect. ENVIRONMENT SUSTAINABLE SERVICE DELIVERY Page 62
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 17 Classification: OFFICIAL We know that this is very important to local people – Over the remainder of this Council term, local government finances and resources of all kinds will be under more pressure than they’ve ever been. Resource levels will inevitably inform service standards and delivery. We need to be more vigilant than ever before about alignment of investment and action to our priorities. Identifying clear returns and outcomes for Argyll and Bute, from allocations of resources, must the starting point of action or investment. Fiscal constraints have put pressure on services and limit what we can deliver. The operations of the Council have risen to the challenge of meeting substantial savings year on year and have approved savings totalling circa £50m over the 10 years to 2025-26. This equates to 15% of the total 2025-26 revenue budget and with each passing year, it becomes more difficult to identify savings. It is important that our models of service delivery are more efficient and more effective, with clear and achievable standards. We want to transform services efficiently and at pace, building on our track record of innovation and digital transformation and in ways that align with the resources we have – a Council fit for the future. We will: Priority Next Steps / Action Provide the best services we can with the money available. Expand the RIS Review approach to other service areas to ensure we have the most effective and efficient delivery models possible. Develop proposals to expand and make the most of digital/technology, including further exploration of AI. Make clear the service standards that communities can expect with the resources available. Review, update, communicate clear quality service standards that match with local needs as well as available resources. Completion and implementation of the Roads and Infrastructure Services (RIS) Review, particularly creation of robust, reliable data to inform decisions. Progress and implement RIS Review. Play our part in calling for a fair deal for councils – including asks for greater flexibilities at local level which helps better serve community needs. Part of work of political lobbying group. Page 63
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 18 Classification: OFFICIAL SPEAKING UP FOR ARGYLL AND BUTE, ITS PEOPLE AND ITS COMMUNITIES Collective, as well as collaborative, action is necessary to deliver growth on the scale that Argyll and Bute needs – No single agency alone can deliver on Argyll and Bute’s overarching aim of significant, vital population and economic growth. We will work in partnership with communities, with all sectors, and at all levels as far as possible to progress Argyll and Bute’s priorities. This will include using our voice as the local authority to call for action where responsibility lies outwith our control or influence. We will: Priority Next Steps / Action Call for policy, investment, flexibility, action - wherever there is a key issue impacting on Argyll and Bute’s chances of growth and success and where responsibility sits outwith the control of the Council. Establish political lobbying group, agree membership, themes, areas for focus as set out throughout the Priorities. Add our voice as the local authority to those of our communities when they are speaking out on issues that are important to them and where external action is needed. Identify needs and opportunities through engagement programme and planned online/digital democracy activities. Lobby for more investment in digital connectivity to boost Argyll and Bute’s status as an attractive place to live. Lobby for digital connectivity improvements to fill the gap in terms of other opportunities which are available and funded elsewhere in Scotland, but which are not practical here due to geography (e.g. active travel). Page 64
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 19 Classification: OFFICIAL 6. Our Challenges and Risks Cost of Living The ongoing cost of living crisis in the UK is felt particularly hard in rural and remote rural areas. Argyll and Bute has: • The highest percentage of people living in remote rural areas of all mainland Councils • Nearly 70% of all households in Argyll and Bute are at risk of fuel poverty or extreme fuel poverty • Despite our relatively high cost of living the average gross weekly pay for full time workers in Argyll and Bute is £682, compared with a Scottish Average of £702 (NOMIS, 2024) Food, clothing, travel – these cost between 13% and 185% + more than in urban UK Page 65
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 20 Classification: OFFICIAL Housing Emergency Argyll and Bute Council was the first Local Authority in Scotland to declare a housing emergency in June 2023. This emergency is due to a complex range of challenges including: • High numbers on the housing waiting list • High homelessness • Low numbers of new tenancies created • Unaffordable house prices (the average house price is up to 7 times the average wage) • 5% less social rented stock than the Scottish Average • The highest level of second homes ownership in Scotland (6% against the Scottish average of 0.9%). In June 2024 a housing emergency action plan was agreed and the Council, together with our partners, are working to deliver on this plan. Financial Outlook Despite an increase in overall Scottish Government funding for 2025/26, the financial outlook for Scotland’s councils remains challenging. At its budget setting meeting in February 2025 Argyll and Bute Council considered the latest budget gap projections for the period to 2030 these included a best case scenario of £13.3m and worst case scenario of £55.9m. The most recent Accounts Commission report ‘Local Government in Scotland – Financial Bulletin 2023/24’ outlines that councils need to intensify transformation activity, progressing at scale and pace to ensure their financial sustainability. How councils plan to use their reserves, make savings and transform their services needs to become more transparent. The need to consult local communities and clearly communicate the implications for local services of the budget decisions taken has never been more important. Risks Many of the challenges facing the Council are intrinsically affected by external socio- economic, environmental, and geo-political uncertainties as well as ongoing financial challenges. The Council has Strategic Risk Register which identifies, assesses and mitigates these. The strategic risk register is regularly reviewed and scrutinised by the Council’s Audit and Scrutiny Committee. Page 66
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Corporate Plan | 2025 – 2027 Argyll And Bute Council #abplace2b 21 Classification: OFFICIAL 7. Our Success measures This Plan will be underpinned by a set of corporate outcomes that will provide streamlined and focussed performance reporting and key performance indicators. This will allow us to improve on our Public Performance Reporting. The outcomes will detail our aspirations at a high level in addressing the priorities across the identified themes. Through this we will demonstrate the impact of our work over the Council term. Page 67
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Classification: OFFICIAL Bute • Helensburgh • Islay • Oban • Mull • Campbeltown • Iona • Dunoon • Tiree • Lochgilphead • Seil … #abpla ce2b Corporate Plan 2025 - 2027 Argyll and Bute Council www.argyll-bute.gov.uk Page 68
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 ARTIFICIAL INTELLIGENCE POLICY 1.0 EXECUTIVE SUMMARY 1.1 Artificial Intelligence (AI) technologies are rapidly advancing and have the potential to support the Council by enhancing efficiency, improving operations and assisting with decision-making for some of its key services. Although the adoption of AI presents significant opportunities to enhance efficiencies in the Council, there are significant risks that must be carefully considered prior to adopting AI within Council operations. These risks are highlighted in a new AI Policy. All local authorities have been advised by Socitm, the Scottish Government, and the Digital Office to implement an AI Policy to help staff use AI in a safe and secure manner. 1.2 The policy is required to help establish guidelines for the Council in the use of AI technologies, and to ensure that the use of AI is ethical, complies with all applicable laws, regulations and Council policies, and complements the Council’s existing information and security policies including the Councils Acceptable Use Policy (AUP). 1.3 We are bringing this policy forward now because AI is much more available than it has been before. It is now available in our web search engines like Bing and Edge and is accessible via products such as ChatGPT. 1.4 It is important for all council users to recognise that Open versions of AI such as ChatGPT or web browsers that use CoPilot are not secure and should not be used when dealing with any council information that is confidential, personal or financial. Any information typed into these tools is openly available to anyone who uses them. 1.5 We will be introducing trials of secure CoPilot as part of our M365 environment for some council users later in the year. This will come at additional cost to our existing licenses, so will be implemented using a cost/benefit based approach. 1.6 The AI policy applies to all users of the Council’s data and systems with access to AI, including elected members. The policy dictates that AI must be used in a manner that promotes fairness and avoids bias to prevent discrimination and contribute positively to the Council’s goals and values, aligning with the Council’s equality and diversity policies. Page 69 Agenda Item 8
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 ARTIFICIAL INTELLIGENCE POLICY 2.0 INTRODUCTION Background 2.1 Advanced AI technologies have been developed for use in our day-to-day ICT and Digital systems. Products such as CoPilot from Microsoft are now fully integrated within the M365 platform but, while they are designed to complete tasks very quickly and efficiently, they come at premium costs. These powerful tools must be used in accordance with law, and in a manner which promotes fairness while aligning with the Council’s equality and diversity policies. This new Artificial Intelligence Policy is required to help establish guidelines for the Council in the use of AI technologies, and to ensure that the use of AI is ethical, complies with all applicable laws, regulations and Council policies, and complements the Council’s existing information and security policies including the Councils Acceptable Use Policy (AUP). 3.0 RECOMMENDATIONS 3.1 The Policy and Resources Committee is asked to approve the new Artificial Intelligence Policy for onward progression to the Council. 3.2 Members are asked to note that this is a fast paced and rapidly changing area of technology and that revisions to this report may be required. Any material changes will be brought for the attention of this Committee. 4.0 DETAIL Applying the Policy 4.1 The Council is now recognised by the Accounts Commission as an Innovative Authority and is well placed to lead on a further series of transformational projects, using AI technology designed to support the council’s ambition for service improvement and sustainability through digital innovation. Services are keen to make use of AI based opportunities but the risks of doing so must be managed and the councils’ systems, data sets, employees, and customers adequately protected. Page 70
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4.2 The new policy provides the necessary guidance for all users of AI and recommends that a comprehensive Data Protection Impact Assessment (DPIA) and Security Assessment should be conducted for any project or process where use of AI is developed or deployed. It recognises that data entered into an AI system may enter the public domain and provides guidance on how service users can minimise any risks associated with regulatory requirements, customer or vendor contracts, or a compromise of intellectual property. 4.3 Users are encouraged to use AI for work-related purposes subject to adherence to this policy. This includes tasks such as generating text or content for reports, emails, presentations, images and customer service communications. The policy also encourages initiatives to enhance AI literacy and skills among all stakeholders, particularly those involved in developing AI solutions, as well as those using AI technologies in their work. 4.4 Appendix 3 of this report contains an initial AI factsheet to help explain some of the issues around AI. A much more detailed FAQ and guidance on how to apply the policy for staff and elected members will be developed and published on the Hub. 4.5 The pace of development and application of AI in this fast-changing environment is such that this policy will be subject to regular review. Any material changes to the policy will be brought back to committee for approval. 5.0 CONCLUSION 5.1 AI Technologies will help the Council deliver more efficient services. Their use should be encouraged but managed to ensure users are appropriately licenced, all applications are ethical and comply with all applicable laws, regulations and Council policies, and they complement the Council’s existing information and employment policies. 6.0 IMPLICATIONS 6.1 Policy: Introduces a new Artificial Intelligence policy. 6.2 Financial: None. 6.3 Legal: None. 6.4 HR: All staff to be made aware of guidance and governance arrangements outlined within the policy and comply with these. 6.5 Fairer Scotland Duty: Page 71
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6.5.1 Equalities - protected characteristics: positive impact identified. 6.5.2 Socio-economic Duty: None. 6.5.3 Islands: None. 6.6 Climate Change: AI uses significantly more electrical power than other forms of ICT processing and internet searches. Work will be done to assess how our developing approach to using AI impacts on our carbon reduction targets. 6.7 Risk: The policy is an important aspect of mitigating risks presented by AI use and potential breaches of information security and governance through the inappropriate use of technologies and publishing of data. 6.8 Customer Service: AI is a tool that will enhance our Customer Service Centre digital responses in quality and speed. 6.9 The Rights of the None. Child (UNCRC): Kirsty Flanagan Executive Director with responsibility for Customer Support Services Policy Lead: Councillor Mark Irvine April 2025 For further information contact: Jane Fowler, Head of Customer Support Services, jane.fowler@argyll-bute.gov.uk Gerry Wilson, ICT and Digital Manager, gerry.wilson@argyll-bute.gov.uk Stuart McGeachy, ICT Compliance and Security Officer, stuart.mcgeachy@argyll-bute.gov.uk APPENDICES Appendix 1: Artificial Intelligence Policy Appendix 2: Integrated Impact Assessment – Artificial Intelligence Policy Integrated Impact Assessment - Power Apps Appendix 3: AI Factsheet Page 72
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Argyll and Bute Council Artificial Intelligence Policy March 2025 Page 73
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Contents 1. Background ......................................................................................................... 4 2. Purpose ............................................................................................................... 4 3. Scope .................................................................................................................. 4 4. Governance ......................................................................................................... 5 Vendors ............................................................................................................... 5 Copyright and Licensing ...................................................................................... 5 Ethical Use .......................................................................................................... 6 Disclosure ........................................................................................................... 7 Integration with other tools .................................................................................. 7 5. Development, Deployment and Use of AI ............................................................ 7 Risk Assessment ................................................................................................. 7 Legal compliance ................................................................................................ 8 Bias and discrimination ....................................................................................... 8 Security ............................................................................................................... 8 Data sovereignty and protection .......................................................................... 8 6. Compliance .......................................................................................................... 9 7. Review ................................................................................................................. 9 8. Acknowledgement ............................................................................................... 9 Page 74
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Version Control Version Creator Changes Date 0.1 Stuart McGeachy Initial Draft 31/07/2024 0.2 Stuart McGeachy Revisions based on ITMT comments. 21/02/2025 0.3 Stuart McGeachy Revisions to Scope and Disclosure sections. 24/03/2025 0.4 Stuart McGeachy Revisions to Governance and Disclosure sections based on Governance and ITMT comments. 31/03/2025 0.5 Stuart McGeachy Updated document font to Arial and left aligned. 02/04/2025 0.6 Gerry Wilson Expanded purpose following SMT comments 17/04/2025 Page 75
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1. Background 1.1. Artificial Intelligence (AI) refers to the development of computer systems capable of performing tasks that typically require human intelligence, such as learning, problem solving and decision making. 1.2. AI technologies are rapidly advancing and have the potential to support the Council by enhancing efficiency, improving operations and assisting with decision-making for some of its key services. Although the adoption of AI presents significant opportunities to enhance efficiencies in the Council, there are significant risks that must be carefully considered prior to adopting AI within Council operations, which will be outlined in this policy. 2. Purpose 2.1 The purpose of this policy document is to establish guidelines for Argyll and Bute Council in the use of Artificial Intelligence (AI) technologies, including, but not limited to machine learning models, natural language processing systems and Generative Artificial Intelligence Large Language Models (GenAI) such as ChatGPT, Google Gemini, Microsoft Copilot. 2.2 GenAI is one of the most prevalent AI technologies utilised across industries and applications, allowing users to input prompts to produce various types of content such as text, images, audio, video, software code and other media. The GenAI models can learn and evolve as it trains on data structure and patterns to produce new data, which is based on the input from the user. 2.3 We need this policy now because AI is much more available than it has been before. It is now freely available in our search engines and these versions operate in such a way that anything we submit for analysis becomes freely available to other users around the world. Safer versions of AI tools will be deployed on the Council’s network in the near future. 2.4 This policy is designed to ensure that the use of AI is ethical, complies with all applicable laws, regulations and Council policies, and complements the Council’s existing information and security policies including the Councils Acceptable Use Policy (AUP). 2.5 The pace of development and application of AI in this fast-changing environment is such that this policy will be subject to regular review. Any material changes to the policy will be brought back to committee for approval. 3. Scope 3.1 This policy applies to all users of the Council’s data and systems with access to AI, including elected members, as well as any other policies and procedures in support of this policy. Page 76
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3.2 Use of AI must be in a manner that promotes fairness and avoids bias to prevent discrimination and promote equal treatment and be in such a way as to contribute positively to the Council’s goals and values, aligning with the Council’s equality and diversity policies. 3.3 Users may use AI for work-related purposes subject to adherence to this policy. This includes tasks such as generating text or content for reports, emails, presentations, images and customer service communications. 3.4 The policy encourages initiatives to enhance AI literacy and skills among all stakeholders, particularly those involved in developing AI solutions, as well as those using AI technologies in their work. 3.5 Particular attention should be given to Governance, Vendor practices, Copyright, Accuracy, Confidentiality, Disclosure and Integration with other tools, as described in the following sections. 4. Governance 4.1 If there is a business requirement to input personal or confidential information to GenAI technology, users must complete a Data Protection Impact Assessment (DPIA) and facilitate the completion of an ICT Security Assessment for the Councils Security team to assess. 4.2 Personal information may not have been requested in surveys/consultations but may have been provided in free text boxes. All such responses must be reviewed and personal information removed prior to using AI technology. 4.3 An internal register of Council-approved AI solutions will be kept to ensure their usage is transparent within the organisation. All AI solutions must be published on the The Scottish AI Register to comply with the recommendations of the Scottish Government. 4.4 Deployment of AI technologies across the Council must adhere to the following guidance and guidelines NCSC AI and cyber security: what you need to know NCSC Secure AI system development ICO Artificial intelligence Vendors 4.5 Any use of AI technology in pursuit of Council activities should be done with full acknowledgement of the policies, practices, terms and conditions of developers/vendors. All AI purchases must be managed through the Council’s procurement team. Copyright and Licensing Page 77
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4.6 Users must adhere to copyright laws when utilising AI. It is prohibited to use AI to generate content that infringes upon the intellectual property rights of others, including but not limited to copyrighted material. 4.7 In addition, users must ensure they comply with licensing terms of any AI system or tools they utilise. This includes verifying whether the generated content can be used commercially, modified, or distributed, depending on the licensing restrictions of the AI service provider. 4.8 If a user is unsure whether a particular use of AI constitutes copyright or licensing infringement, they should contact the Legal and Regulatory Support before using AI. Accuracy 4.9 All information generated by AI must be reviewed and edited for accuracy prior to use. Users of AI are responsible for reviewing output and are accountable for ensuring the accuracy of AI generated output before use/release. 4.10 If a user has any doubt about the accuracy of information generated by a given AI tool or solution, they should not use that AI tool or solution without applying appropriate correction. Confidentiality 4.11 AI systems must comply with data protection regulations, including GDPR and other applicable laws. 4.12 Confidential and personal information must not be entered into public GenAI tools, applications or web sites (like ChatGPT), as information may enter the public domain. Users must follow all applicable data privacy laws and organisational policies when using AI. 4.13 If a user has any doubt about the confidentiality of information, they must not use that AI tool. Ethical Use 4.14 AI must be used ethically and in compliance with all applicable legislation, regulations and Council policies. 4.15 Users must not use AI to generate content that is discriminatory, offensive, or inappropriate. If there are any doubts about the appropriateness of using AI in a particular situation, users should consult with their supervisor or Information Governance Team. 4.16 Human oversight is essential for the ethical use of AI ensuring that AI systems operate in alignment with societal values and ethical standards. Page 78
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Human review must be conducted on AI outputs for biases, discrimination and accuracy. Disclosure 4.17 Transparency in AI is crucial for ensuring accountability, which includes providing information on how the AI-generated decisions are made. 4.18 The presence and role of any AI systems may be disclosed in our operations to all relevant stakeholders, including employees, customers and partners. This includes information on how AI systems are used, details of the data they process and decision making processes they support. 4.19 Any user content produced via AI must be identified and disclosed as containing AI-generated information. Integration with other tools 4.20 Application Programme Interface (API) and plugin tools enable access to AI and extended functionality for other services to improve automation and productivity outputs. Users should follow OpenAI’s Safety Best Practices: • Adversarial testing • Human in the loop (HITL) • Prompt engineering • “Know your customer” (KYC) • Constrain user input and limit output tokens • Allow users to report issues • Understand and communicate limitations • End-user IDs API and plugin tools must be rigorously tested for: • Moderation – to ensure the model properly handles hate, discriminatory, threatening, etc. inputs appropriately. • Factual responses – provide a ground of truth for the API and review responses accordingly. 5. Development, Deployment and Use of AI Risk Assessment 5.1 Use of AI carry inherent risks. A comprehensive Data Protection Impact Assessment (DPIA) and Security Assessment should be conducted for any project or process where use of AI developed or deployed. The risk assessment should consider potential impacts including legal compliance; bias and discrimination; security (including technical protections and security certifications); and data sovereignty and protection. Page 79
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Legal compliance 5.2 AI systems developed or deployed within the Council must comply with applicable laws and regulations and with Council policies. 5.3 Data entered into an AI system may enter the public domain. This can release non-public information and breach regulatory requirements, customer or vendor contracts, or compromise intellectual property. Any release of private/personal information without the authorisation of the information’s owner could result in a breach of relevant data protection laws. Use of AI to compile content may also infringe on regulations for the protection of intellectual property rights. Users should ensure that their use of any AI complies with all applicable laws and regulations and with Council policies. Bias and discrimination 5.4 AI may make use of and generate biased, discriminatory or offensive content. AI systems developed or deployed by the Council must be regularly tested for bias by the service users who must take corrective actions to ensure fairness. 5.5 Users should use AI responsibly and ethically, in compliance with Council policies and applicable laws and regulations. Security 5.6 AI systems must be secure by design to protect against data breaches, cyber-attacks and any other misuse. Regular security assessments and updates should be conducted to address potential vulnerabilities to ensure security standards align with frameworks such as Public Sector Network (PSN) and Payment Card Industry Data Security Standards (PCI DSS). 5.7 AI may store sensitive data and information, which could be at risk of being breached or hacked. The Council must assess technical protections and security certification of AI before use. 5.8 If a user has any doubt about the security of information input into a specific AI tool/solution, they should not use that specific AI tool/solution. Data sovereignty and protection 5.9 While an AI platform may be hosted internationally, under data sovereignty rules information created or collected in the originating country will remain under jurisdiction of that country’s laws. The reverse also applies. If information is sourced from AI hosted overseas, the laws of the source country regarding its use and access may apply. Page 80
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5.10 AI service providers should be assessed for data sovereignty practice by any organisation wishing to use their AI. 6. Compliance 6.1 Any violations of this policy should be reported to the Council’s Information Governance Team or senior management. Failure to comply with this policy may result in disciplinary action, in accordance with Council’s Human Resources policies and procedures. 7. Review 7.1 This policy will be reviewed annually and updated as necessary to ensure continued compliance with all applicable legislation, regulations and organisational policies. 8. Acknowledgement 8.1 By using AI, users acknowledge that they have read and understood these guidelines, including the risks associated with the use of AI. This policy has been largely based on the guidance prepared by ALGIM (Aotearoa - New Zealand) and Socitm (UK). www.algim.org.nz www.socitm.net Page 81
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AI Policy – Appendix 3 - Factsheet What is AI and what kind of things can it be used for? AI, or Artificial Intelligence, is computer technology that can perform some tasks that typically have required human intelligence and in-put. It can be used for many things, for example, answering questions, producing minutes or reports, or supporting customer service. How does AI do that? It does this in different ways. A key thing is that it does everything very quickly. For example to answer questions the computer technology searches for information already available on the internet and other digital channels, and from there pulls together answers based on the information it identifies as relevant to the question asked. What are the potential advantages of AI? A key benefit is that AI can save employee time and so increase efficiency and productivity by automating routine tasks, enhancing customer service through automated answers to questions, and help manage risks for example by predicting maintenance needs. It is also another route for people finding information about the council, for example if a potential job candidate does a search for Argyll and Bute Council. What are its potential risks? There are significant risks for example in relation to accuracy, information security, reputation, and political bias. • Accuracy: AI pulls together information it identifies as relevant to questions asked; as the internet holds information that is both accurate and inaccurate, this means that AI information needs to be checked for accuracy. • Information security: AI works in effect like a big library, full of the information that people upload into it. Once in the AI ‘library’ (or large language model) the information is available for others to find. Confidential or sensitive information therefore is not secure. • Reputation: as AI does not distinguish between what is accurate or inaccurate information, or confidential or non-sensitive information, it could produce reputationally damaging information. Why do we need a policy for how the council uses it? We need a policy because, as outlined above, AI offers both advantages and risks to the council. A policy would be there to help employees assess how to make effective use of AI and work in the interests of the council and communities in doing so. AI has been available for some time, but with the advent of GenAi, where new content can be created in response to a user’s prompt from search engines such as Google and Bing, the technology is now much more accessible and therefore we have to manage all associated risks. Page 83
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 ARGYLL AND BUTE EQUALITY MAINSTREAMING REPORT 2025 1. INTRODUCTION 1.1 As part of equalities duties set out in the Public Sector Equality Duty (PSED), the Council, Education Authority, and Licensing Board are required to report on their equality mainstreaming activities every two years. 1.2 The Equality Mainstreaming Report 2025, which covers the period 2024-2025, is appended to this covering report. The Mainstreaming Report covers the three authorities mentioned above. 2. RECOMMENDATIONS 2.1 It is recommended that the Policy and Resources Committee approves the Equality Mainstreaming Report. 3. DETAIL 3.1 The Equality Mainstreaming Report (Appendix 1) has been produced to meet the requirements of the PSED. The Mainstreaming Report sets out how we have mainstreamed equalities in our everyday work and how we have progressed in meeting our current equalities outcomes. 3.2 In addition, this Mainstreaming Report includes the publication of the new set of Equality Outcomes (approved by the Policy and Resources Committee on 20 February 2025). 3.3 We are obligated to publish the Mainstreaming Report. We request the committee to approve the Mainstreaming Report to enable the publication of the approved version. The Mainstreaming Report will be published alongside workforce data. Page 85 Agenda Item 9
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4 CONCLUSION 4.1 The Policy and Resources Committee is asked to approve the Equality Mainstreaming Report. 5.0 IMPLICATIONS 5.1 Policy: There are no policy implications arising directly from this report. 5.2 Financial: There are no financial implication arising directly from this report. 5.3 Legal: The production and publication of the Equality Mainstreaming Report is required as part of the Public Sector Equality Duty (PSED). 5.4 HR: Workforce reporting and profiling have been completed as per the requirements of the PSED. 5.5 Fairer Scotland Duty: 5.5.1 Equalities: protected characteristics: The Equality Mainstreaming Report has been produces to fulfil the requirements set out in the PSED. An Equality and Socio-Economic Impact Assessment was previously completed with regard to the Equality Outcomes set for period 2025-2029. 5.5.2 Socio-economic Duty: No issues relating specifically to our socio- economic duties arise from this report. An Equality and Socio- Economic Impact Assessment was previously completed with regard to the Equality Outcomes set for period 2025-2029. 5.5.3 Islands: No issues relating specifically to islands arise from this report. An Equality and Socio-Economic Impact Assessment was previously completed with regard to the Equality Outcomes set for period 2025- 2029. 5.6 Climate Change: No climate change implications arise directly from this report. 5.7 Risk: No risk implications arise directly from this report. 5.8 Customer Service: No customer service implications arise directly from this report. 5.9 The Rights of the Some actions identified for the delivery of our Equality Child (UNCRC): Outcomes 2025-2029 have been designed to complement and embed progress relating to the Page 86
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incorporation of the UNCRC. Kirsty Flanagan Executive Director with responsibility for Customer Support Services Policy Lead: Councillor Mark Irvine Report prepared: 1 April 2025 For further information contact: Jane Fowler, Head of Customer Support Services, jane.fowler@argyll-bute.gov.uk Chris Carr, OD Project Officer, chris.carr@argyll-bute.gov.uk APPENDICES Appendix 1: Equality Mainstreaming Report 2025 Page 87
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Argyll and Bute Council Equalities Mainstreaming Report and Equality Outcomes 2025 April 2025 Page 89
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Table of Contents Section 1: Background context ............................................................................................... 3 1.1 Public Authorities covered by this Mainstreaming Report ......................................... 3 1.2 Legislation ................................................................................................................ 3 1.3 Mainstreaming Equality within Argyll and Bute ......................................................... 4 1.4 Key Documents ........................................................................................................ 4 1.5 Learning and Development Activity .......................................................................... 6 1.6 Workforce ................................................................................................................. 7 1.7 Partnership working.................................................................................................. 8 1.8 Equality Forum ......................................................................................................... 9 1.9 Gypsy Traveller Working Group .............................................................................. 9 1.10 Other groups and representation ....................................................................... 10 Section 2: Monitoring and Continuous Improvement ............................................................. 10 2.1 Review of our Equality Impact Assessment process............................................... 10 2.3 Community Engagement ........................................................................................ 11 2.4 Disability Confident accreditation............................................................................ 11 2.5 Review of workforce data ....................................................................................... 11 2.5 Awareness raising .................................................................................................. 11 2.6 Working with refugees ............................................................................................ 13 2.7 Community Engagement ........................................................................................ 14 Section 3: Equality Outcomes (2019-2023, extended to 2025) ............................................. 14 3.1 Argyll and Bute’s Equality Outcomes (2019-2023, extended to 2025) .................... 14 Section 4: Equality Outcomes (2025-2029)........................................................................... 21 4.1 Developing our new outcomes ............................................................................... 21 4.1 Argyll and Bute’s Outcomes (2025-2029) ............................................................... 23 4.2 Equality Action Plan (2025-2029) ................................................................................ 25 Section 5: Workforce Monitoring and Reporting .................................................................... 25 Our detailed workforce reporting has been published separately. (Appendix One: Workforce as of years ending 31 March 2023 and 2024.) ................................................. 25 6.0 Policy Statement with regard to Equal Pay: ............................................................ 26 Page 90
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Section 1: Background context 1.1 Public Authorities covered by this Mainstreaming Report Argyll and Bute Council's Equalities Mainstreaming Report and Equality Outcomes 2025 covers the following listed authorities: • Argyll and Bute Council • Argyll and Bute Education Authority • Argyll and Bute Licensing Board. 1.2 Legislation The Equality Act 2010 brought together for the first time legislation relating to the nine protected characteristics of race, disability, sex, age, sexual orientation, religion and belief, gender reassignment, marriage and civil partnership, and pregnancy and maternity. The Act requires public authorities, when carrying out their functions, to: • Eliminate discrimination, harassment and victimisation. • Advance equality of opportunity between people who share a protected characteristic and those who do not. • Foster good relations between people who share a protected characteristic and those who do not. The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012 and subsequent amendments are designed to help public sector organisations meet their duties as set out in the Equality Act. The requirements of the Public Sector Equality Duty include: • Report on mainstreaming equality. • Publish equality outcomes and report on progress. • Assess and review policies and practices. • Gather and use employee information. • Publish gender pay gap information. • Publish statements on equal pay. This mainstreaming report describes how the three public authorities it covers have been making progress in these areas. That inequality of opportunities is not only an issue for people with protected characteristics is reflected in other legislation, including: • Part 1 of the Equality Act 2010, commonly referred to as the Fairer Scotland Duty, which seeks to tackle socio-economic disadvantage and reduce inequalities of outcome. • Islands (Scotland) Act 2018. Since our last mainstreaming report was published, the United Nations Convention on the Rights of the Child (Incorporation) (Scotland) Act 2024 has come into effect. Page 91
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1.3 Mainstreaming Equality within Argyll and Bute Mainstreaming equality means integrating equality into an organisation’s day-to-day working. This means taking equality into account when acting as an employer, or planning and providing services. 1.4 Key Documents Previously, the Council has aligned its corporate outcomes with those of the Community Planning Partnership. This is no longer the case. In September 2024, the Council approved a new set of priorities and principles. These were one of the inputs we considered when developing our new set of equality outcomes. As part of wider work looking at the council’s performance management arrangements, we are working to rationalise our strategies and create a new set of corporate/strategic outcomes. We recognise the need to ensure our equality work and outcomes align with wider organisational strategy, and this is reflected in our newly adopted equality outcomes. (See section 4). The Council's Constitution The Council's Constitution : • Sets out the council’s principles of decision making; these include a commitment with regard to human rights and the Public Sector Equality Duty (part A, page 10). • States that responsibility for determining and implementing the Council’s policies in relation to the promotion of equality of opportunity and initiatives to combat discrimination sits with the Policy and Resources Committee (Part C, page 70). • Sets out the Council's requirement that contracts awarded by the Council contain an obligation obliging contractors to comply with all duties arising from the Equality Act 2010 (Part E, pages 187-8). Employee Code of Conduct The Employee Code of Conduct includes a section which deals specifically with Equality and Diversity. It sets out the council's commitment to equalities and signposts readers to the council's Equality, Diversity and Inclusion Policy, Equalities Mainstreaming Reports, and Dignity at Work Policy. It states: The Council will promote an ethos in which self-respect and respect for others are of the utmost importance. All individuals will be valued equally and therefore be given every opportunity to fulfil their maximum potential in society. The Council insists that those who suffer discrimination, whether direct or indirect, receive fair treatment and adequate remedies and affirms that it will address appropriately all sources of discrimination. The Code of Conduct makes it clear that 'any instances of discrimination, harassment or victimisation at work will be viewed as a serious matter'. Page 92
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The Employee Code of conduct is available on the Council's My Council Works website, which is accessible to any employee with internet access. It is also appended to the Council's Constitution (as Part F part 3). Equality, Diversity and Inclusion Policy The purpose of the Council’s Equality, Diversity and Inclusion Policy is to make sure that the organisation, employees and elected Members do not unlawfully discriminate against people with protected characteristics as set out in the Equality Act 2010. It also ensures that we oppose and avoid all forms of unlawful discrimination, and ensures equality, fairness and respect for all in the council’s employment. The Equality, Diversity and Inclusion Policy includes links to other relevant documents and resources: • Manager’s Guide to Recruitment and Selection. • Dignity at Work Policy: Eliminating Workplace Bullying and Harassment Policy and Procedure. • Disciplinary Procedures and Code of Practice. • Grievance Procedure. • Employee Code of Conduct. • Code of Conduct for Councillors. • Guidance on the Councillors’ Code of Conduct. • Advice Note for Councillors on Bullying and Harassment. • Equality and Socio-Economic Impact Assessment. • Complaints. • Phased Return to Work and Other Reasonable Adjustments: Manager’s Guide. • Supporting Attendance at Work Policy. Procurement Section 4.3 of the Council's Procurement Strategy 2022/25 states: The Council is mindful that the impact of procurement is far greater than this definition of a ‘process’ and our vision, objectives and principles as set out in this Strategy illustrate the contribution that effective procurement arrangements can make to wide ranging socio-economic agendas. These include equality and diversity, a successful local economy, a thriving voluntary and third sector, environmental issues and value for money for Argyll and Bute residents. Section 5.2 includes the following commitments: Ensuring procurement activity contributes towards the Council’s general Equality Duty towards all stakeholders in Argyll and Bute and beyond; Continuing to promote sustainability, fair work practices and the importance of equality and equal treatment through procurement. Section 5.5 covers the mandatory requirements of the Procurement Reform (Scotland) Act 2014 and Statutory Guidance Obligations. Item 5 relates to 'Payment of a living wage – to persons involved in producing, providing or constructing the subject matter of regulated procurements’. Page 93
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Argyll and Bute's Sustainable Procurement Policy 2022/25 also makes reference towards equalities, including the following: d) In relation to social considerations, our priorities will be: • To ensure there is no intentional discrimination against specific groups of people when undertaking procurements - Equalities and Diversity considerations will be embedded throughout the procurement process; • To ensure that our contract terms require suppliers to support the health, safety, welfare and rights of their employees and supply chain – ensuring that the Council does not support human trafficking or modern slavery. Education The council’s website contains key documents and information relating to the following topics: • Additional Support Needs • Argyll and Bute's Autism Strategy • The work of the Corporate Parenting Board and a link to the Corporate Parenting Strategy. • Mental health: guidance about mental health and wellbeing in children and young people. • Argyll and Bute Children and Young People's Service Plan • School uniform scheme: describes how Argyll and Bute Council is working with its schools and third sector partners to roll out an innovative scheme that sees school uniforms children have outgrown being reused or recycled, thereby ensuring all students have access to uniforms. 1.5 Learning and Development Activity All staff are required to complete equalities training. The council's Equality and Diversity e-learning course is mandatory for all networked staff and should be completed as part of induction. The training is available through our online e-learning platform, LEON. Our e-learning equality training course is also available to community groups within our area via the council’s website. In addition to our mandatory equality and diversity course, we host further equality- related resources on LEON. These included e-learning courses, podcasts, and recorded webinars and cover topics including: • Neurodiversity • Identifying ableist language • Children’s rights • Digital accessibility • Allyship • Unconscious bias • Plain English • Menopause Page 94
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• Mental health • Deaf awareness • Engaging with communities • Various resources relating to gender-based violence and domestic abuse • Protecting children • Trauma informed training. Equalities is a standing item on the agenda of the regular meetings held by the council's Training Centre; these meetings involve all people who are involved in the delivery of training. The Violence Against Women and Girls Partnership delivered a number of training events in 2023/4 and 2024/5. In addition to events focussing on domestic abuse, they also covered human trafficking, harmful traditional practices, women’s rights workshops, and animal abuse as a form of coercive control. Professional Learning Programmes are in place for Education staff. The Argyll and Bute Career-long Professional Learning (CLPL) catalogue provides a range of professional learning opportunities for staff at all levels. This has led to an increased awareness of equalities and knowledge of both internal and external supports that are available. CLPL sessions include: • Young Carers – Carers (Scotland) Act 2016: how to identify young carers and covers the young carers statement • Mentors in Violence Protection (MVP): a peer mentoring programme that gives young people the chance to explore and challenge attitudes, beliefs and cultural norms that underpin all forms of gender-based violence in our society • Keeping the Promise: three sessions to support staff to achieve the ‘I Promise Award’ • Money Counts: the course aims to build the confidence of staff to offer income maximisation help and explains how to ask about money worries and where and how to refer for support. All staff are signposted to external equalities CLPL offers via the Argyll and Bute Leadership and Professional Learning website. External offers include: • Education Scotland Professional Learning Activities: becoming an anti-racist educator; Racial Trauma: the consequences of racism on mental wellbeing; and Talking about racism: steps to improve racial dialogue in education • GTCS Equality and Diversity Hub Professional Learning about equalities also features in the Argyll and Bute Probationer programme and Aspiring to Headship programme. In addition, the Head Teacher Conference structure allows for one annual conference that is dedicated to the priorities of the Wellbeing, Inclusion and Attainment team, ensuring equality priorities remain a strong focus. Agendas for the meetings alongside evaluations are evidence of the impact of this approach. 1.6 Workforce Workforce planning has been embedded across the organisation. Workforce planning requires we understand the current profile of our workforce and identifies how we can make sure it will meet the future needs of the organisation. Key outcomes of the workforce plan include ensuring we have a balance between Page 95
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younger and older employees and the health and wellbeing of our employees is supported. Workforce planning meetings are held annually, during which HR Business Partners and Third Tier managers discuss workforce risks. Ahead of these workforce planning meetings, Services are provided with a dashboard showing the profile of their workforce. We also monitor the workforce through regular Health of the Organisation reports. 1.7 Partnership working Examples of partnership working and groups include the following: • Community Planning Partners are invited to attend the council’s Equality Forum meetings. • We have an active Violence Against Women Partnership operating within the area. • Employability Partnership. • UNCRC implementation group. • Ukrainian Resettlement Group. • Child Poverty Action Group. • Financial Inclusion Advisory Group. Much of the work relating to socio-economic disadvantage within Argyll and Bute is managed through the FIAG and the child poverty action group. Membership of the FIAG is drawn from elected members, council officers and partners. The FIAG fulfils an anti-poverty role, covering and taking account of the Fairer Scotland Duty. The HSCP has previously shared the Council’s approach to Equality and Socio- Economic Impact Assessments and is going to adopt the council’s new Integrated Impact Assessment process. This brings Council and HSCP processes into closer alignment. Education works collaboratively with HSCP, Live Argyll and third sector organisations through the UNCRC Working Group and in line with Argyll & Bute’s Children and Young People’s Service Plan. Planet Youth is a community partnership approach helps us learn about what is needed to keep our young people safe, healthy and happy. In Argyll and Bute, the Planet Youth project is led by Education and Public Health. This shared approach has helped improve strategic links. The intention is to further enhance strategic links through the work of a central coalition to be established in 2025; this will help support the work of the local coalitions that are already in place. The Planet Youth project’s survey, carried out every two years, has allowed us to capture data about young people’s experiences in five of our nine secondary schools. Data from the Planet Youth survey and approach is already informing other priorities such as the Shaping Places for Wellbeing project, Child Poverty Action Plan and the Sexual Health Strategy Group. Page 96
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1.8 Equality Forum Set up in 2013, the council's Equality Forum has been running for over a decade. The forum’s Its Terms of Reference were reviewed and updated in early 2018 and again in 2023. The purpose of the Equality Forum is to enable issues relating to equalities to be raised. In turn, the forum helps Argyll and Bute Council to deliver its obligations as set out in the Equality Act 2010. Meetings take place quarterly. However, members of the Equality Forum may use the forum as a 'sounding board' at any time, with such communications taking place outwith the formal meeting cycle. Membership of the Equality Forum is drawn from across council Services and partner agencies, enabling better coordination and collaboration. 1.9 Gypsy Traveller Working Group In 2019 the Scottish Government and the Convention of Scottish Local Authorities (COSLA) launched the first ‘Improving the Lives of Scotland’s Gypsy/Travellers’ strategy. One of the key aims of the strategy was for the Gypsy/Travellers community to ‘have a seat at the table, are listened to, and have a say in the decisions that affect their lives’. The Gypsy/Traveller Working Group (GTWG) was established as the forum which aims to make this happen in Argyll and Bute. The responsibilities of the GTWG include: • Understanding the accommodation needs and preferences of Gypsy/Travellers to inform future provision • Work with Gypsy/Traveller communities to raise awareness of rights and entitlements • Ensure that our public services are responsive to Gypsy/Travellers needs and preferences • Provide leadership to tackle racism and discrimination • Strengthen community development and engagement • Work with Gypsy/Travellers to improve their involvement in national and local decision making The core membership of the GTWG includes representation from the key strategic partners involved in delivering accommodation, health, education, advocacy, and community safety for the gypsy/travellers community as well as community representation which is central to the effectiveness of the group. Core partners include: • Gypsy/Travellers Community • Argyll & Bute Council o Housing Services o Education o Community Development o Regulatory Services o Legal & Regulatory Support • Argyll Community Housing Association (ACHA) • Fire Scotland • Fyne Homes Page 97
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• MECOPP • Police Scotland • STEP • West Highland Housing Association Community representatives have identified a number of initial priorities to be taken forward by the Gypsy Traveller Working Group. • Engagement: Over the years there have been many round table discussions. However, the community often felt there were no outcomes from these. The establishment of the GTWG has been welcomed to co-ordinate future actions. • Awareness: The community would like to see actions to try breaking the stigma, and raising awareness of the issues of the discrimination, they experience. • Education: There is a lot of bullying experienced in local schools by Gypsy/Travellers. To try to address, it was agreed the Education system was the best way to reach younger generations to raise awareness of Gypsy/Traveller community culture. • Accommodation: The GTWG have acknowledged that both sites Dunchologan and Bayview require significant upgrades to meet long-term needs of current and future tenants. 1.10 Other groups and representation Other groups that deal with aspects of equality and fairness include but are not limited to: • UNCRC Incorporation Group: the purpose of this group is to ensure Children’s Rights are embedded across the organisation in line with legislation and best practice. • TU Liaison Group. • Strategic and Departmental Management Team meetings. • LGBTQ+ Network (Education led). • Mentors in Violence Prevention Steering Group (Education Led). • Violence Against Women Partnership Section 2: Monitoring and Continuous Improvement 2.1 Review of our Equality Impact Assessment process In 2024/5, we reviewed and replaced our Equality and Socio-Economic Impact Assessments with a new Integrated Impact Assessment process. We did this for several reasons: 1) The Equality and Socio-Economic Impact Assessment form needed to be amended to meet website accessibility standards 2) In a review of our EqSEIA arrangements, carried out in 2023, Internal Audit recommended we develop a proposal for an online tool 3) The number of impact assessment frameworks we have to consider when developing a new proposal has increased. Page 98
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The new Integrated Impact Assessment includes the following impact assessments: • Equality • Fairer Scotland Duty • Island Communities: we have amended the questions asked in this section of the impact assessment • Children’s Rights and Wellbeing: this is a new section • Consumer Duty: this is a new section. Our online tool guides people through the impact assessment process, with guidance built into each section to facilitate completion. To coincide with the launch of the new tool and process, we communicated the changes through emails, posts on the MyCouncil Works website, an article in Cascade (the council’s monthly employee newsletter), and webinars to which all officers are invited. We have also arranged bespoke demonstrations of the new tool to groups of officers upon request. 2.3 Community Engagement We have developed and published a Community Engagement Framework. This Framework is a resource for staff and elected members and gathers in one place • information on methods of engagement • tools to engage • the case studies and contacts to assist with supporting engagement to be relevant and inclusive. See section 4 for more details. 2.4 Disability Confident accreditation The Council reaccredited as a Disability Confident Employer in January 2025. The current accreditation is valid until January 2028. 2.5 Review of workforce data We continue to engage with the Society of Personnel & Development Scotland (SPDS) with regard to improvements to our workforce data, notably around pay gap reporting. We have recently changed our Human Resources and payroll software. As part of the ongoing work to embed the new system, work will continue to encourage the volunteering of equality information. This is reflected in the new equality outcomes for 2025-2029 and actions to deliver them. (See section 4.) We recognise the need for higher rates of disclosure to meet the future requirements for more detailed and robust pay gap reporting. 2.5 Awareness raising There are two kinds of awareness raising which go on within the organisation. The first relates to work targeted at staff, relating specifically to the work they do. The second relates to awareness raising activities which are broader in scope and reach Page 99
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(for example through wellbeing webinars and programmes, promotion of events relating to the 16 Days of Action against gender-based violence, Pippa’s podcasts, or social media posts to coincide with awareness days). Education has actively supported awareness raising of Children’s Rights with staff, learners and wider community through the UNICEF Rights Respecting Schools Awards. We currently have 100% of our schools registered for the award and are working towards 100% of our schools being accredited. In 2024, Argyll and Bute launched the Young Carers Challenge. The challenge is facilitated by Carers Trust Scotland and requires schools to have in place a Young Carers Procedure, a Young Carers Champion, partnership working with carers centres, evidence of case studies, appropriate data recording on SEEMIS (Education’s Management Information System), and awareness raising activity. We will monitor engagement with the challenge and aim to have all schools signed up to this challenge by the end of 2025. Whilst being care experienced is not a protected characteristic, our Education Service continues to raise awareness of this life experience and work towards Keeping the Promise by 2030. We are actively committed to Education Scotland’s Promise Award programme. This professional learning programme aims to promote The Promise message and reduce stigma attached to care experience to anyone working in an education setting. Our Care Experience Education team were the first team in Scotland to receive We Promise team accolade with our Chief Officers Groups being the first local government senior leadership team to achieve the We Promise Award. Alongside this, individuals and whole settings are participating in training to achieve I Promise and We Promise. This is leading to increased understanding of what it is to be care experienced and feedback evidences positive changes in practice from a range of adults working in our settings. Argyll and Bute continue to demonstrate their commitment to our care experienced children and young people by having a dedicated team to both support, challenge and raise awareness of care experience across our settings. Each setting has a Designated Manager for care experienced children and young people who is responsible for ensuring care experienced individuals have the support they need to achieve their potential. Our school data system discreetly identifies each pupil who has care experience, supporting our practitioners to be mindful of their approach. In addition, e-mails with information and opportunities specifically in relation to The Promise are shared with our settings regularly to continue to raise the profile of this cohort. Teachers and Educators cannot support children and young people unless they have timely access to the right information that they need. In Argyll and Bute we made it a priority to create a website solely for practitioners to access everything they need in relation to Additional Support Needs. This allows practitioners to spend more time on what they do best: teaching and learning. The Inclusion and Equality Team has created a number of guidance documents to support teachers and educators. The Managing Challenging and Distressed Behaviour Guidance has been a crucial piece of guidance to help staff work with some of our most vulnerable pupils so that they are included within the school environment irrespective of the challenges they may be facing. Page 100
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2.6 Working with refugees The Council has identified ‘reaffirm[ing] our commitment to refugee settlement, valuing the contribution that new families and residents make to life in Argyll and Bute’ as one of the Council’s priorities (2024-2027). The council and its partners have welcomed refugees from Syria, Sudan, Afghanistan, and Ukraine to our area and offers them support. The nature of the support given is tailored according to the relevant schemes. Following a review of the outcomes for unaccompanied asylum seeking children Argyll and Bute a new model of support was developed in Autumn 2023. This has seen the support for UASC over the age of 16 transfer from the Social Work Throughcare team to the Resettlement team and the development of a new Resettlement Throughcare pathway. Under our new Resettlement Throughcare pathway model and the associated support those under 16 continue to be accommodated in children’s houses or foster care. Those over 16 move directly into leased properties where they are supported to live independently and are taught life skills. For further information see Unaccompanied Asylum Seeking Young People in Argyll and Bute. As of June 2024, In Argyll and Bute we were supporting over 300 displaced persons form Ukraine within our communities. The council’s resettlement team and the wider multi agency partnership provide humanitarian support to recover from trauma, to resettle into a new community and to navigate the complexities of life in the UK. Many of our Ukrainian refugees have come to Argyll and Bute through the Scottish Government’s welcome accommodation, hotels, and been matched by the resettlement team to a host or been allocated social housing or sourced private rented properties. Researchers from Glasgow University have produced A Report on the Emergency Resettlement of People from Ukraine in Argyll and Bute. The Lead Teacher for Leadership and Career-long Professional Learning (CLPL) has supported Ukrainian refugees who have teaching experience or a teaching qualification from Ukraine through the Argyll and Bute Teacher Career Pathway. Since 2022, Classroom Assistant posts have been created for teachers on the pathway to support Ukrainian pupils in Argyll and Bute and to develop the skills and knowledge required to register with GTC Scotland. Colleagues on the Teacher Career Pathway have attended Career-long Professional Learning sessions on Curriculum for Excellence, BGE and Senior Phase, Nurture and Relationships. Teachers on the pathway also have access to the Argyll and Bute CLPL Catalogue and are supported by school staff to develop their knowledge and understanding of Scottish education. The Lead Teacher for Leadership and CLPL has supported one of the teachers through the GTC Scotland application process and they have recently received Provisional Registration. A placement has been arranged at a local school for the teacher to complete the required number of days in order to become a Fully Registered Teacher in Scotland. Page 101
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Temporary funding has been used to create a temporary Education Support Officer post that provides additional support to schools in relation to supporting refugee/asylum seeking children, young people and their families. Training has been delivered in relation to supporting children with English as an additional language (EAL). Guidance on supporting children with English as an additional language will be in place by April 2025. We continue to support participation in Education Scotland’s Building Racial Literacy Programme. To date we have 3 staff who have completed the programme (one secondary, one primary and one from the central team). A further two staff are currently working towards the completion of the programme. 2.7 Community Engagement The Council has recently produced a new Community Engagement Framework. This is designed to enable a consistent approach to how we engage with our local communities. To develop the framework, a Community Engagement group was set up, bringing together officers from across the council. Although the Framework and its associated resources have been approved and published, the group will continue; raising awareness of, and sharing good practice across the engagement is key to the success of this group. This group has also shown the potential of bringing officers together to create synergies that might otherwise be lost in the siloed organisational structures of the council. A similar approach is being taken by the council’s Data Advisory Group; the latter will be key to improving the collection and use of equality-related data. This is reflected in our new equality outcomes / equality action plan. See section 4 for more details about the Community Engagement Framework. Section 3: Equality Outcomes (2019-2023, extended to 2025) 3.1 Argyll and Bute’s Equality Outcomes (2019-2023, extended to 2025) The Council, Education Authority and Licensing Board developed new Equality Outcomes for the period 2019-2023. Although our equality outcomes were reviewed in 2023, we did not make changes to them at that time because: • the current ones were still seen as being fit for purpose; • Scottish Government was undertaking a review of the Public Sector Equality Duty and was considering the introduction of national outcomes in 2025 which would have given any new outcomes formulated at that stage only two years of life, and; • extending our outcomes by a further two years gave us the opportunity to realign our outcome setting timetable to other listed authorities. (We were out of sync with other local authorities following a review of outcomes a number of years ago.) Outcome: We support our workforce, encouraging participation across all age groups Duty: Advance equality of opportunity Protected characteristics: All, with particular attention to age Page 102
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Purpose: We believe that all employees, including those from all the protected characteristics, should be encouraged, and have equal opportunity, to participate fully within the workforce. This principle is set out in the council’s Equality and Diversity Policy. We recognise that the Council, in common with the population of Argyll and Bute more widely, has particular issues and risks relating to the age of our workforce. This is why this outcome emphasises age. We actively encourage young people to join our workforce, to provide long-term opportunities for them in our area and to create our workforce for the future. Actions identified to tackle this challenge relate to succession planning, upskilling of staff, and the recruitment of apprentices. In 2023/24, 14 Foundation Apprentices (Social Services Children and Young People) were enrolled. In 2024/2025 this figure rose to 22. In 2023/24, 3 Modern Apprentices (Social Services Children and Young People) were enrolled. In 2024/2025, the figure was 2. One of the Mas has gone on to secure employment with the council. Also in 2024/5, one Modern Apprentice enrolled in Roads and another in Customer Support Services. In addition, through our workforce planning process, solutions are being investigated to resolve challenges around non-statutory childcare provision and to ensure that resilience is put in place to ensure continuity of service should staff who work with minority groups leave. This is important where the numbers of staff involved are low, making their areas of work vulnerable to change. Work is starting to identify ways to encourage the retention of the 55+ workforce. This work will continue over the next reporting period. We are also engaging with the SPDS’s Equality and Inclusion group which is looking at ways to recruit more diverse workforces; it is benchmarking activity with other council’s and aims to share good practice and recommendations for the future. Outcome: We promote diversity across occupational groups Duty: Advance equality of opportunity Protected characteristics: All, with particular emphasis on sex Purpose: The Council has a highly segregated workforce in some types of job. For example, people working in home care are 99% female. By contrast, employees in Roads and Amenities and IT are predominantly male. We aim to widen opportunity for people in job roles that they may not have considered otherwise and create opportunity for all. See previous outcome and previous Equality Mainstreaming reports. Outcome: We have improved engagement with protected groups Page 103
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Duty: Foster good relations Protected characteristics: All Purpose: We aim to make sure the voices and opinions of people from protected groups are heard when we engage with our service users. This is particularly important when people from particular protected groups may have different experiences or needs and whose voices may not be heard so clearly. Digital Accessibility Argyll and Bute Council is committed to ensuring that our online services are accessible to all residents. To enhance awareness and understanding of digital accessibility, we have developed in- house training materials for staff; these are available on LEON. This training material helps make sure that employees are equipped with the necessary knowledge to create and maintain accessible digital content. The council’s Webteam has worked closely with its Communications team to update corporate document templates to meet accessibility requirements. The updated templates are published on our MyCouncil Works site, ensuring that staff have easy access to these resources. To ensure transparency and compliance with the regulations, we are currently reviewing all accessibility statements across our websites and web applications. This review will ensure that the statements are up to date, accurate, and reflective of our ongoing commitment to digital accessibility. The latest Silktide Index report, which evaluates website accessibility across the public sector shows that our commitment to accessibility is being recognised. In February 2025, Argyll and Bute Council achieved a ranking of 29th (out of 364 websites tested) with an overall accessibility score of 99% against the WCAG 2.2 spec. This demonstrates our continued progress in making our digital services more inclusive and user-friendly. To further support accessibility, we have introduced the Recite Me toolbar on our website. This tool provides users with various customisation options, including text-to-speech functionality, reading aids, and styling adjustments, allowing individuals to tailor their browsing experience to their needs. It is important to note that while Recite Me offers additional tools that can be helpful to many users, it does not resolve underlying accessibility issues within the website itself. True accessibility improvements require adherence to WCAG 2.2 guidelines and the ongoing development of fully inclusive web content. Progress towards this can be seen in our Silktide report. Additionally, we have incorporated bespoke customisation features to Recite Me to facilitate easy access to Gaelic translation. This ensures that Gaelic-speaking residents can fully engage with our online services in their preferred language. Child Friendly reports UNCRC legislation has introduced the requirement for Child Friendly Reports in all matters that affect the child/young person. Working through the Children and Young People’s Service Plan and the UNCRC Group, we have developed a range of approaches to report to children and young people. One page versions of The Child Poverty Action Plan, Children and Young Person’s Service Plan and the UNCRC plan have been created, all co-produced with children and young people. Page 104
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Tackling Rural Poverty The council is working in partnership with the Poverty Alliance as one of the pilot areas in the Tackling Rural Poverty project. Work has in included the creation of a lived experience panel. In turn, this panel has responded to engagement activities around the council’s budget, discretionary housing payments, and the proposed introduction of the visitor’s levy. See also section 1.9. Outcome: People with protected characteristics have improved experiences of services Duty: Advance equality of opportunity; foster good relations Protected characteristics: All Purpose: We aim to make sure that, as far as possible, our services meet the needs and aspirations of people from protected groups and that we work to improve their experience of our services. For information about work around digital and website accessibility, see above. For information about refugees, see section 2.6. Learning Centres In Argyll and Bute, our Learning Centres continue to provide accessible, supportive and inclusive learning environments where children and young people can thrive and reach their full potential supported by staff who are experienced in severe and complex needs. Our Learning Centres develop individualised curriculum plans to include a wide range of flexibility to support all learners’ needs. The focus is on providing holistic education where we meet the social, emotional, physical and educational needs of our children and young people. Our plans to increase the equity of specialist provision for children and young people with complex needs received Council approval in August 2023. We are addressing gaps in provision and we are now creating more high quality Learning Centre provision to serve all four geographical areas here in Argyll and Bute. New facilities will include accessible teaching and outdoor spaces. CALL Scotland We liaise with CALL Scotland regularly to support learners in Argyll and Bute. Communication is crucial to a child or young person being able to be an active participant in their learning and within the wider world; CALL supports teachers and schools to implement best practice and technology to support a wide range of pupils with varying communication needs, including: • eye gazing technology • visual communication for non-verbal pupils, and • technology to support children with literacy issues such as dyslexia. Care experienced children and young people Page 105
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We have approximately 300 care experienced children and young people (CECYP) in educational settings across our authority at any given time. Our care experienced children and young people are included and supported through existing authority policy and guidance. Across our educational settings, staff undertake mandatory training which raises their awareness of some challenges our care experienced children and young people can face. This, alongside wider training opportunities such as nurture and trauma-informed practice, supports our staff to build positive relationships our care experienced individuals. Feedback from our care experienced children and young people has evidenced that having positive relationships in their education setting is crucial to their sense of belonging. Investing in our workforce is having a positive impact, ensuring our care experienced children and young people area able to access their right to education. We have invited the representation of our care experienced children and young people, for example at senior leader conferences which were attended by two of our Children’s Houses, through participation project opportunities, and working directly with members of the Care Experience Education Team (CEET). Our CEET can link school and home and work towards removing any barriers to education, leading to increased wellbeing and attainment for our care experienced children and young people. The CIRCLE Framework The CIRCLE Framework is a way of organising and supporting input using a staged system of support, beginning with setting up an inclusive classroom. CIRCLE focuses on whole school and classroom environments in terms of the physical environment, the social environment and structures and routines. Rather than thinking about what a learner can and can’t do or only thinking about their underlying ability or disability, the CIRCLE framework encourages us to think more widely, particularly paying attention to aspects of the environment, which impact on the child. This promotes the implementation of a culture of inclusion and equality across schools in Argyll and Bute, encouraging regular consultation with school leaders and practitioners, parents and young people through a whole school approach. Training education practitioners in primary and secondary schools across Argyll and Bute in Inclusion in Practice, The CIRCLE Framework aims to support equity in Argyll and Bute. Promoting effective inclusive practice within the classroom and school environment using the CIRCLE Framework of Inclusion, raises awareness of how to promote a learner-centred approach where all learners are listened to and involved in the management of their own learning. CIRCLE provides the tools to support the assessment, documentation of evidence of assessment, and the supports and strategies to utilise, informed by need and observation. This promotes a whole school approach to inclusion, creating and maintaining inclusive classrooms, supporting learners with skills, supports and strategies to develop independence in their learning and promoting collaborative partnership working. Learners are listened to and involved in the management of their own learning and able to access learning alongside their peers. At the centre is evaluation of the environment in which young people learn, modifications to the environment, both physical and social, establishing structures and routines and approaches to enhance motivation. Often when we consider adapting a child’s environment, we think about the physical space around the child and the resources in place to support them. Equally important is the Social Environment; the attitudes, expectations and actions of the people around the child. Adapting our communication to match a child’s developmental level and communication style, can have a real impact on how well that child is included within the class and school. Page 106
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Outcome: We take the views of people from protected groups into account when we change our services. Duty: Advance equality of opportunity; foster good relations Protected characteristics: All Purpose: We aim to make sure that the needs and opinions of people from protected groups are taken into account when we make changes to the way we deliver our services. This helps us to make sure that people with one or more protected characteristics have equal opportunity to access the services we provide as those who do not share a protected characteristic. Community Engagement We have developed and published a Community Engagement Framework. This Framework is a resource for staff and elected members and gathers in one place • information on methods of engagement • tools to engage • the case studies and contacts to assist with supporting engagement to be relevant and inclusive. Development of the Framework was led by the council’s Engagement and Communities Lead and included a review of best practice for engagement frameworks nationally, alongside engagement with officers through the council’s Community Engagement Strategy Group, staff consultation, focus groups and senior management meetings of Council and HSCP. The resource is supplemented by a course on community engagement. This is hosted on LEON and is aimed at officers who are new to community engagement activity. As part of the wider work around community engagement and improvements relating to how we gather information, we have produced guidance around how to ask equality questions along with a template of questions which can be used as is or amended to suit specific circumstances. Expectations around consultation and engagement are set out in our impact assessment guidance. Work around enhancing community engagement, including how to reach harder to reach groups, will continue across the next mainstreaming period. Bringing officers together in the council’s Community Engagement group, it has highlighted work around: • Youth Voice • Tackling Rural Poverty In turn, this has opened up wider opportunities for engagement with children and young people and people with lived experience of rural poverty. We are grateful to these groups for their engagement with us and helping to ensure we can capture the interests and views of an increasingly diverse range of people and interest groups. See also section 1.9. Page 107
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Outcome: We do not tolerate bullying and harassment of people from protected groups Duty: Foster good relations; eliminate discrimination Protected characteristics: All Purpose: As part of wider work to tackle bullying in schools, we will take action to reduce bullying on the basis of one or more of the protected characteristics. Education’s Anti-Bullying Policy is available online. Education has scheduled a review the policy; this is captured in the actions to support the delivery of our new Outcome 5: Our communities are safe for, and welcoming to, people with protected characteristics. (See below.) The council has made all HR policies available online on the MyCouncil Works website. This means all staff, including non-networked staff, can access information and resources so long as they have an internet connection. Among the HR pages is one about Bullying and Harrassment. This provides information about the council’s zero tolerance approach to bullying, how to raise concerns, how to access support, and links to policies and procedures, and the Employee Assistance Programme. Outcome: The gap in educational attainment between people with and without protected characteristics is reduced. Duty: Advance equality of opportunity Protected characteristics: All Purpose: We work to provide a high standard of education to all pupils, and we want to reduce gaps in attainment between people with, and without, protected characteristics. This will help us to advance equality of opportunity for young people who share one or more of the protected characteristics. Education monitors attainment gaps relating to deprivation, gender, care experience, and refugees. The continued monitoring of these attainment gaps is reflected in an action deliver on our new Outcome 5: We ensure people with protected characteristics are enabled to progress. (See below.) Education has a number of measures in place to support the closure of attainment gaps. These include the following. The Exchange provides a counselling service for all young people in education settings from the age of 10. In addition, KOOTH provides an online service. Both services are promoted across education settings and are signposted within the Health and Wellbeing Drama performance You Are Not Alone which is delivered to S2 pupils. Mental Health and wellbeing of pupils is monitored through the Glasgow Wellbeing & Motivation Profiling Tool, Planet Youth, and School Climate Survey. Page 108
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Our care experienced children and young people tell us that they wanted to be ‘treated the same’ as those who are not care experienced. We are mindful of this as we aim to meet their needs, often with a requirement for significantly greater support. We have a range of discreet systems in place to ensure we can provide opportunities for our care experienced children and young people. This includes financial, wellbeing, academic, transition, and post school destination support. For example, if a school is finding it difficult to secure a work placement for a young person, we will meet with partners to explore opportunities. This can help ensure the correct level of support and relational approach is in place, increasing the chance of success and achievement for the young person. Destination data in 2022-23, shows 86.4% of our care experienced children and young people went into an initial positive destination. This increased to 97% in session 2023-24. A bespoke data sharing agreement ensures we can support cross authority transitions to ensure our care experienced children and young people have continuity of support and a well-planned transition wherever possible. Also see above (People with protected characteristics have improved experiences of services). Section 4: Equality Outcomes (2025-2029) 4.1 Developing our new outcomes In drafting proposed outcomes prior to public consultation, we: • Looked at the council’s priorities. • Considered existing areas of activity with which links can be made. • Horizon scanned changes happening outwith the organisation. • Consulted internally with officers in relation to Education, Violence Against Women, Refugees, and workforce-related activities. We have also presented papers with the proposed outcomes to the council’s Departmental Management Teams, requesting input from other Services. • Discussed the development of equality outcomes at the UNCRC Incorporation Working Group and the Equality Forum. • Made a presentation to the CPP Management Committee about our proposed equality outcomes. The public consultation was published on the council’s website and publicised through the council’s weekly ‘Argyll and Bute News Round Up’ email. In addition, organisations known to the Community Development team were emailed to promote the consultation with the intent to reach community groups working with individuals who have one or more of the nine protected characteristics. The public consultation ran from 23 November 2024 to 10 January 2025. In total, 24 responses were received in response to the public consultation, twenty from individuals and four from organisations. Broadly speaking, responses were supportive of the proposed outcomes. See table 1. Table 1: Numbers of respondents agreeing or disagreeing to proposed equality outcomes Page 109
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Proposed outcome Agree Disagree No response 1. We make access to information and services for people with protected characteristics 21 3 0 2. Our communities are safe for, and welcoming to, people with protected characteristics 22 2 0 3. We raise awareness of issues and challenges faced with people with protected characteristics along with ways to overcome them. 20 3 1 4. Argyll and Bute is a welcoming place for New Scots to come and settle in. 19 3 2 5. We ensure people with protected characteristics are enabled to progress. 22 2 0 6. Our work relating to equalities and people with protected characteristics is coordinated across the organisation and strategically aligned. 22 2 0 We received some suggestions for wording of the outcomes. Limited changes to wording were made in light of these. Several responses to the public consultation raised concerns that reference to protected characteristics in the outcomes was too limiting and that actions should extend to groups who experience serious deprivation and poverty. However, the wording of the equality outcomes, and specific reference to protected characteristics has been retained because this reflects the requirements of the PSED. Equality outcomes are not delivered as an alternative to work the council already does to address issues relating to deprivation and poverty. Responses reflecting both sides of the trans debate were received in the course of this consultation. Two responses disagreed with all the equality outcomes. One of these was on the basis that making things ‘easier’ for people with protected characteristics will build resentment between them and other groups because this was not seen as equality. The other was on the basis that the outcomes rely too heavily on third sector organisations for their delivery and these are not council led. We disagree on both counts. The Equality Outcomes for the period 2025 to 2029 were approved by the council’s Policy and Resources Committee on 20 February 2025 and the Licensing Board on 22 April 2025. The new outcomes are as follows: 1. We make access to information and services easier for people with protected characteristics. 2. Our communities are safe for, and welcoming to, people with protected characteristics. 3. We raise awareness of issues and challenges faced by people with protected characteristics along with ways to accommodate and support them. 4. Argyll and Bute welcomes New Scots and supports them. 5. We ensure people with protected characteristics are enabled to progress. Page 110
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6. Our work relating to equalities and people with protected characteristics is coordinated across the organisation and its partners and is strategically aligned. In conjunction with these outcomes, we have developed an action plan for their delivery. See section 4.2. 4.1 Argyll and Bute’s Outcomes (2025-2029) Outcome 1: We make access to information and services easier for people with protected characteristics. • Relates to our duties to: Advance equality of opportunity; foster good relations. • Relates to: All protected characteristics. Rationale: This outcome reflects the following considerations: • Scottish Government has talked for several years about encouraging inclusive communications. • UNCRC incorporation includes a requirement to produce child-friendly documents; we wish to develop an environment within the organisation which supports the creation of these documents. Work around the UNCRC is referenced in the council’s priorities. • Accessibility links with other activities including the Council’s BSL plan and website accessibility. • Accessibility links with wider good practice (including the production of easy read documents). Outcome 2: Our communities are safe for, and welcoming to, people with protected characteristics. • Relates to our duties to: Advance equality of opportunity, foster good relations. • Relates to all protected characteristics. Rationale: This outcome: • Serves as an umbrella for a range of activities being carried out by the council and the Education authority. • Enables people to have access to safer spaces. Safer may refer to the physical environment or to community safety. • Encompasses work being carried out by the Violence Against Women Partnership around Violence Against Women and the Equally Safe Plan. • Ties into work Education does around bullying. Outcome 3: We raise awareness of issues and challenges faced by people with protected characteristics along with ways to accommodate and support them. Page 111
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• Relates to our duty to: Foster good relations; advance equality of opportunity. • Relates to all protected characteristics. Rationale: This outcome: • Keeps equalities and issues arising around protected characteristics on people’s radar. • Ties in with ‘fosters good relations’. • Reduces organisational risk by ensuring equalities-related issues are better understood. • Makes explicit our support for groups which may find themselves feeling vulnerable in the current global climate. Outcome 4: Argyll and Bute welcomes New Scots and supports them. • Relates to our duty to: Foster good relations; advance equality of opportunity. • Relates to all protected characteristics with particular focus on ethnicity. Rationale: • Work with refugees has been picked up by the Council’s administration as one of its priorities • This outcome ties in with Scottish Government’s New Scots Refugee Integration Strategy Outcome 5: We ensure people with protected characteristics are enabled to progress. • Relates to our duty to: Foster good relations; advance equality of opportunity. • Relates to all protected characteristics with particular focus on ethnicity. Rationale: This outcome relates to: • Closing gaps between different groups, for example around educational attainment. • Creating closer links with workforce planning activities. • Increasing opportunities for those with protected characteristics to their fulfil potential. Outcome 6: Our work relating to equalities and people with protected characteristics is coordinated across the organisation and its partners and is strategically aligned. • Relates to our duty to: advance equality of opportunity. • Relates to all protected characteristics. Rationale: This outcome focuses on how we do things and what could be done better, rather than what we do. We do a lot of good work around equalities and disadvantaged groups, but these are not always linked together. It will: • Ensure more consistent practice within the organisation. Page 112
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• Ensure joined up practice, tying into the idea of ‘themes not teams’. • Ties into wider Community Engagement work. • Ties into wider work around data and evidence-based decision making. 4.2 Equality Action Plan (2025-2029) We have developed an action plan to support the delivery of the Equality Outcomes (2025- 2029) and will monitor it regularly for performance and compliance. Section 5: Workforce Monitoring and Reporting Our detailed workforce reporting has been published separately. (Appendix One: Workforce as of years ending 31 March 2023 and 2024.) Page 113
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6.0 Policy Statement with regard to Equal Pay: Argyll and Bute Council is committed to the principle of equal opportunities in employment to ensure that employees are not discriminated against irrespective of their age, race, disability, sexual orientation, gender, gender re-assignment, marriage/civil partnership, pregnancy, maternity, religion or belief. Argyll and Bute Council is committed to ensuring that all staff, irrespective of gender should receive equal pay for the same or broadly similar work, for work rated as equivalent and for work of equal value. The Council’s equal pay objectives are to: • Eliminate any unfair, unjust or unlawful practices that impact on pay; • Take appropriate action to address these accordingly; • Regularly monitor and review the application of policies and procedures and; • Conduct an equal pay review to monitor existing pay practices in line with the Equality and Human Rights Commission’s Equal Pay Statutory Code of Practice. In order to achieve equal pay for employees, the Council operates a pay system which is transparent, based on clear criteria and free from unlawful bias through the application of the nationally agreed job evaluation scheme and relevant legislation. For Teachers the Council complies with nationally agreed pay and conditions of service. Argyll and Bute Council is committed to ensuring equal pay structures for all its employees and will: • Conduct regular audits to monitor the impact of its pay structure. • Provide training and guidance for those involved in determining pay. • Respond to grievances on equal pay in accordance with the council's Grievance Policy. • Work in partnership with recognised trade unions to ensure that the Council provides equal pay. • Review progress every 4 years. Page 114
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE 8 MAY 2025 JOINT REPORT BY CUSTOMER SUPPORT SERVICES AND FINANCIAL SERVICES ITRENT HR AND PAYROLL SYSTEMS REPLACEMENT PROJECT UPDATE 1.0 EXECUTIVE SUMMARY 1.1 The purpose of this report is to update Policy and Resources Committee on the major new HR and Payroll system implementation, to highlight what has been delivered so far and request additional funding to complete the final elements of the project. 1.2 The Policy and Resources Committee agreed to support the HR and Payroll system replacement project in 2021, with funding approved for this purpose. The previous system was about to become obsolete. MHR/iTrent were the successful bidders and a project team and project board were put in place to oversee the implementation of the new system. 1.3 This paper highlights the successes in the installation of this new system to date, along with a number of challenges that emerged post implementation, which have caused some delays to completing the final elements of system installation and realisation of the full expected outcomes. These final elements will result in greater efficiencies and accuracy in our people management processes. 1.4 The Policy and Resources Committee is requested to approve: a) The continued development and implementation of the remaining elements of the iTrent project (Phase 2), in order to maximise the benefits from its investment, as outlined in the original business case; and b) Additional budget resources of £480k for 2025/26, to be funded from the partial release of an earmarked reserve balance, previously earmarked to create a general provision for future redundancy costs. Page 115 Agenda Item 10
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE 8 MAY 2025 JOINT REPORT BY CUSTOMER SUPPORT SERVICES AND FINANCIAL SERVICES ITRENT HR AND PAYROLL SYSTEMS REPLACEMENT PROJECT UPDATE 2.0 INTRODUCTION 2.1 In 2021, the council approved the replacement of its core HR & payroll software application, Resourcelink with MHR iTrent. This decision was taken following approval of the associated Business Case by SMT, the agreement to allocate funding and the selection of a preferred provider via a competitive procurement process. This resulted in the award of a 5 year contract to MHR iTrent, commencing 1 January 2023. 2.2 A multi-disciplinary project team was established to deliver the successful implementation of the replacement system. The system comprises a number of modules and phased implementation saw the first modules go live in August 2024, with the new payroll module delivering the August pay for teachers. 2.3 A number of challenges have been encountered post implementation. These predominantly relate to issues associated with the functionality of the payroll module. Unfortunately, these issues were unforeseen and therefore not provided for within the original project timescale and approved resources. 2.4 A project remediation plan for the resolution of key issues is now in place and resources have been allocated to develop and manage delivery of agreed remedial actions. A risk based approach has been taken to the deployment of resources and it has been necessary to prioritise this remedial work over the continued development and implementation of remaining modules, fundamental to delivery of the wider objectives outlined in the business case. 2.5 It will not be possible to fully deliver the iTrent project objectives within approved project resources. As such, a cost benefit analysis of potential options has been undertaken in order to inform recommended next steps. Page 116
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2.6 The purpose of this report is to set out the original iTrent project objectives, provide and update on progress and challenges to date, and bring forward recommended next steps, based on an options appraisal. 3.0 RECOMMENDATIONS 3.1 The Policy and Resources Committee is requested to approve: a) The continued development and implementation of the remaining elements of the iTrent project (Phase 2), in order to maximise the benefits from its investment, as outlined in the original business case; and b) Additional budget resources of £480k for 2025/26, to be funded from the partial release of an earmarked reserve balance, previously earmarked to create a general provision for future redundancy costs. 4.0 DETAIL 4.1 Project Objectives and Vision 4.1.1 A copy of the Business Case Executive Summary is given within Appendix 1 for information. The key driver for the business case was that Resourcelink was not fit for purpose to deliver on the council’s digital, transformational agenda and the system was reaching end of life. The business case set out the need to procure and implement an HR and payroll system that would deliver: • An effective and efficient way of paying staff. • Efficient and effective storing, processing and reporting on employee data. • An intuitive user interface to manage the employment relationship efficiently and effectively. 4.1.2 The specific business and project objectives comprised the following: • Demonstrate management of the entire HR & Payroll journey from recruit to retire. • Ensure seamless integration with data platforms and reduce administrative workload through intuitive design. • Centralise employee information and reduce duplication of data across multiple systems. • Achieve improved reporting, creating a single, reliable source of truth for all stakeholders. • Successful configuration, testing, and live implementation of iTrent. • Development of necessary interfaces to external and council systems. • Effective training for HR, Payroll, and ICT teams to manage the system and its processes. Page 117
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• Proper decommissioning of legacy systems and a strong data management approach. 4.1.3 The vision for the project was not to simply implement new software, but to review our current practices and processes in the design of each module, ensuring what was built was an automated and intuitive user experience, reflective of modern HR and Payroll best practice and in line with the Council’s digital and transformation agendas. 4.2 Project Governance 4.2.1 A multi-disciplinary project team was established to deliver project design, development and implementation, with representation from Payroll, HR Operations and Systems Development; and input from professional ICT, Finance and Procurement support services. This aimed to ensure that knowledge of the new system would be embedded within existing staff. 4.2.2 A Project Board was established to oversee project delivery, with the Head of Customer Services as SRO. The Board comprised senior managers from HR and Financial Services, in addition to the project team, supported by ICT and procurement colleagues. The Board has met regularly since the project inception and continues to monitor and review project management information. 4.2.3 The Board has put in place a post implementation remediation workplan, as advised by ELT, to ensure satisfactory resolution of a number of critical issues arising from the implementation of the payroll module. This workplan continues to be closely monitored with regular progress updates provided to the ELT. It has also been necessary for the Board to agree the redirection of resources from the continued development and implementation of further modules to the remediation of priority issues. These priority actions were essential and had to be undertaken immediately to configure functionality to ensure the pay awards were implemented before Christmas and all employees received their back pay in addition to ensuring that the payruns can run each month. The other critical items relate to costings and the accounts, pension returns and timesheets. These were prioritised by ELT pending the development of an options appraisal on next steps. 4.3 Progress To Date 4.3.1 The initial phase of project implementation progressed broadly to plan. Resourcelink was safely decommissioned, with all data removed by the contract end date of 28 September 2024. The new payroll module went live for teachers in July 2024 and SLGE employees in August 2024. 4.3.2 Specific deliverables comprised the following: • Configuration and installation of the new software, with all security checks completed. • All employee data transferred, and multiple, complex work patterns installed. Page 118
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• Installation of all pay rates, pension and NI rates; leave entitlements; and post hierarchies. • Front end of HROnline configured, tailored to Argyll and Bute Council, with images and key tasks easily accessible creating a user-friendly interface. • Structure Chart prepared and installed, which had been unavailable in Resourcelink. • Secure Single Sign On for all networked staff and Multi Factor Authentication for all non-networked staff configured and enabled. • Absence recording and return to work notifications to managers configured and enabled. • Temporary contract extensions designed, configured and enabled for self service. • Travel and Expenses, New starts and Visa process designed, configured and enabled. • Training and guidance for employees developed and delivered, with FAQs also provided online and through HR Service Centre. • All legacy data safely removed from Resourcelink and stored in a secure manner, accessible for reporting. • All key reports created in Business Objects to schedule. • Design and configuration of elements of case management and recruitment. 4.4 Key Challenges 4.4.1 It became clear at the early stages of the project that the system as purchased was not an ‘off the shelf’ product but a basic set up that required much more significant design, build and configuration by the in-house team than had been anticipated. This meant that the team had to amend their detailed plans to re- allocate time for build. This then had a knock-on impact on the capacity available in the project team to carry out testing on the system once configured. The project was working to the hard end date of the Resourcelink contract, so there were tight timescales to meet. Testing was not therefore fully carried out for all of the modules that were installed. 4.4.2 In the early stages of the project, it was not possible to re-direct existing payroll staff from business as usual activities to the project, to the extent initially planned. Additional resources were secured, albeit with limited knowledge of local payroll processes, however, overall available project resources were insufficient and this impeded progress on payroll specific as well as HR workstreams. Attempts to recruit a suitably qualified and experienced Payroll Professional to lead the Payroll Workstream were unsuccessful. This compounded the issue of sufficient time to carry out testing of essential payroll processes on the new system was limited. 4.4.3 Subsequent to configuration of the new iTrent system, the project team embarked on an intensive period of dual running, with iTrent operating in a test environment and Resourcelink continuing to operate in the live environment, prior to going live with iTrent. This dual running was anticipated to be required for 2 months, however, a significant number of unresolved Page 119
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discrepancies and errors between the two systems required this period to be extended to 5 months. The Project Team sought to diagnose and resolve as many errors as possible during dual running before going live with iTrent, which necessitated the redirection of project team and support resources from other workstreams to basic payroll support. As such, these other workstreams, which had been planned for, are currently part developed, but as yet incomplete. 4.4.4 Ultimately, with a hard deadline for Resourcelink to be decommissioned by 28 September 2024, the decision was taken to go live with iTrent for Teachers in July 2024 and SLGE staff in August 2024. 4.4.5 From go live, whilst the majority of regular, salaried staff have been paid accurately and on time since August, and are using the self-service HROnline system, there continued to be high volumes of errors and ELT was advised in November 2024 that there were significant issues with the following: • Absence – the system is not calculating entitlements reliably, as currently configured, resulting in additional checking and manual intervention. The team is working with iTrent consultants to reconfigure and maximise automation and accuracy. • Pensions – the monthly i-Connect extract from the system had not been configured leading to delays in the submission of data to the LGPS administrators. There is an external deadline of 31 May for submission of 2024-25 pensions data to the Strathclyde Pension Fund. The team are currently on track to complete the work to meet this date. • Costings – the costing extracts from iTrent do not meet our accounting requirements and this has consumed additional resources through manual intervention, and delayed processing. Work on the system has been carried out and this will be complete and fit for purpose in April, before the Annual Accounts are submitted. • Pay Award – additional consultancy support and a significant level of manual calculations were required to ensure implementation of the new 2024/25 pay rates and arrears of pay to all staff by Christmas 2024. This was successfully delivered on time. • Timesheets – the functionality available for entering timesheets into iTrent as configured is poor, using our current practice. This has created significant issues for both staff entering data, and for Payroll and Project Team resources, with additional resources consumed in providing support to users and correcting input errors. An options appraisal to improve this position is currently being developed to maximise use of the system’s opportunities for automated uploads and input. 4.4.6 The post-implementation issues have resulted in employees across Payroll, HROD and Systems Development prioritising and spending significantly more of their time than should be necessary on manual processing and diagnosing individual pay issues. This has resulted in resource being diverted from the planned programme to complete all the planned system improvements. Page 120
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4.4.7 The Executive Leadership Team has requested a report on lessons learned and officers will report back on this in due course. It is expected that lessons learned may be considered and incorporated into operational arrangements for future major projects, to ensure continuous improvement. 4.5 Outstanding Project Deliverables 4.5.1 The Council has been recognised by the Accounts Commission as having a good track record in delivering on transformation and is considered to be ‘ahead of the game in achieving efficiencies, including through its use of digital technology’. This project, whilst having encountered some challenges in its initial implementation stages, is a clear example of the Council building on what the Accounts Commission identified as our culture of innovation by configuring a forward-looking, multi- functional, automated system. 4.5.2 Once complete, the new system will be an important tool in our transformational journey, creating efficiencies for our employees and managers, having a positive impact on our reputation as an employer of choice and our ability to recruit and retain staff. It will also ensure that our processes are better designed, better adhered to and more efficient for managers and employees, leading ultimately to fewer grievances and disciplinaries. 4.5.3 Due to the above mentioned, post-implementation issues with the system, a number of key project elements that were planned have not yet been delivered. These are all included in our contract price, so we are already paying for this functionality. These workstreams have already been worked on by the project team in preparation for final configuration and delivery. They were paused to divert project resources to enable the post implementation remediation work on the issues set out above to take place. 4.5.4 These are all system benefits that add value, improve automation, workforce reporting, employee experience and manager efficiency. The modules that have not yet been delivered comprise the following: A. Recruitment and Onboarding This part of the system will allow us to have an automated end to end process for all new starts to the organisation, improving new employee experience from seeing a job advert to starting on their first day with the Council. This will improve both our reputation as an employer and will reduce administrative work for managers who are recruiting new staff. • We intend to continue using MyJobScotland as our main recruitment site but will substitute Talentlink (the manual input system managed by COSLA) with an automated feed from MHR iTrent. • The pre implementation survey showed managers spend between 3 and 7 hours of their time per vacancy using Talentlink. In 2024 the council advertised a total of 1,212 vacancies (excluding casuals). This means we can expect between 3,636 and 8,484 hours of management time were used for completing tasks associated with recruitment i.e. a management Page 121
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time cost to the organisation of around 2-3 FTE for recruitment. The recent employee survey showed managers among the highest proportion of the workforce reporting they frequently have too much to do, citing HR, procurement and other corporate processes as taking too much of their time. • New employees will benefit from a smooth, end to end experience starting with their application form, through to their contract being issued and their induction being carried out. • This interface will allow us to improve efficiency in reporting on recruitment and retention issues to help address workforce planning challenges • We will continue to need resource in HR service centre so there is limited opportunity to reduce back-office resource requirements • Discussions are still in progress with COSLA, iTrent and other Council to configure this. B. Time and Attendance • We aim to use the module available in iTrent to replace the current Crown contract (£10K per annum) for MyOptions This module is included in our iTrent contract price. This will allow us to automate leave management, support associated payroll calculations (unpaid absence and leavers) and improve data analytics on different types of leave. This is important workforce information in the context of increasing sickness absence trends across the public sector. • This will enable all annual leave to be recorded in one system for management of leave and absence, automatically calculate leave entitlement for leavers. C. Case Management The Iken system, which was being used for Employee Relations case management, was discontinued on the assumption that iTrent case management would be implemented. The HR Operations team have therefore had to revert to fully manual case management process. This is currently causing resource pressures for the Employee Relations team who are dealing with increased volume and complexity of case load alongside a manual tracking system. Last year recorded the highest number of disciplinaries since before COVID, almost double compared to year before, which presents us with an increased level of risk as the employer. Implementing this module will offset the need for additional staffing cost, improve efficiency and mitigate that risk. Implementing Case Management will deliver: • All employee case data will be stored securely in one place and accessible by all HR advisors making it easier to understand the stage/advice thus far and easier for all stakeholders to pick up on compliance issues/overdue stages/ timescales. It also reduces the risk of paperwork being misplaced/filed. It will automatically produce a case timeline of actions Page 122
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completed by those involved important for dismissal meetings, appeals and tribunals. • Automated email reminders to managers or officers involved will remind them to progress to the next stage/highlight if actions are overdue, supporting cases to be handled consistently and according to our procedures therefore reducing risk and increasing compliance. • As all stakeholders in cases will have access to their cases in the module, this will allow better collaboration between HR advisors and line managers or lead managers allowing advice to be recorded and information shared regarding the progression of the case and reasons for delays. • With all information in one place more detailed reports on case trends, service performance and outcomes will be available ensuring a data driven approach for decision making and proactive interventions. • Dashboards will allow senior HR and service managers to review the cases and their progress across their area of responsibility. • Automatic generation and saving of correspondence within the case management system will save time for managers and officers involved in the administration of these processes and ensure paperwork does not go missing. • Manual recording, reporting and reminders will no longer be used, improving overall effectiveness and compliance. • Managers will save time when dealing with cases. 4.6 Financial Position 4.6.1 Reserves totalling £332k were earmarked to meet project costs associated with the development and implementation of the iTrent solution. The actual project expenditure incurred during 2024-25 is expected to be managed within available budget resources. However, due to the challenges outlined in Section 4 and the required redirection of resources to remediation activities, the earmarked reserve balance will require to be fully drawn down in 2024-25, with no residual resource available to meet the cost of delivering the remaining elements of the project. 4.6.2 It is currently estimated that additional resources of £480k will be required to complete the payroll remediation plan (circa. £155k); and implement the remaining elements of the project (circa. £325k), to fully deliver the expected project outcomes, in line with approved business and project objectives. This comprises additional costs for consultancy (£56k) and staffing (£424k), with a continued requirement for temporary specialist staff and backfill for key posts in the Payroll, HROD and Systems Development Teams. 4.6.3 The profile of required project staffing over 2025-26 to complete both payroll remediation and to deliver the remaining elements of the project is outlined in the table below. The remediation of post implementation payroll issues is expected to be substantially completed by 30 June 2025 (Quarter 1), with delivery of the remaining project elements targeted for completion by 31 March 2026. Page 123
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Team Q1 Q2 Q3 Q4 DEV Team 4.88 4.88 2.38 2.38 HR 4.40 4.40 4.26 1.76 Payroll 6.35 0.00 0.00 0.00 Total 15.63 9.28 6.64 4.14 4.6.4 It has been necessary to enter into commitments during 2024-25, to support delivery of the business critical remedial activities in respect of payroll. These commitments extend into 2025-26, with additional unbudgeted expenditure of circa. £75k incurred during 2025-26 to date (8 May 2025). 4.6.5 A review of earmarked reserve balances has been undertaken, in order to highlight potential opportunities to re-prioritise the use of existing resources, in line with the council’s Transformation agenda and longer term financial planning. Previous prudent decisions have allowed for a substantial general provision for future redundancy costs. However, at this stage, this is not underpinned by detailed planning assumptions. As such, it is proposed to release £480k of this balance for the redirection of resources to delivery of the remaining elements of the iTrent project, in line with original project objectives and as part of our Transformation agenda. It is intended to the review the level of the redundancy earmarked reserve, as part of our five year budget approach, with any recommendations in this respect brought back to committee at a future date. 4.7 Cost Benefit Analysis 4.7.1 Given the requirement for additional resources to complete the project, in line with the original specification, it is deemed appropriate to undertake a cost benefit analysis, in order to inform next steps. As such, a cost benefit analysis was undertaken in respect of 5 identified potential options, as outlined below. Description Option 1 Conclude project immediately post payroll remediation Option 2 Procure alternative new system Option 3 Outsource Payroll/HR Services Option 4 Purchase Shared Services (OLA provider) Option 5 Deliver existing project specification (Phase 2) 4.7.2 While it has not been possible to provide fully reliable cost estimates for each option, the analysis outlines key considerations, providing a rationale for the ranking of each option in terms of both costs and benefits. Key considerations for each option are outlined within Appendix 2. 4.7.3 Each of the 5 options have been evaluated on both costs and benefits, based on the considerations outlined above. A score between 1 and 5 has been Page 124
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assigned to both costs and benefits, where 1 represents highest cost/lowest benefit and 5 lowest cost/highest benefit. Options have been ranked 1 to 5 based on an overall score, where 1 represents the best option. The outcome of this evaluation is summarised in the following table. Option Cost Score 1 Highest – 5 Lowest (A) Benefits Score 1 Lowest – 5 Highest (B) Overall Score (A)x(B) Rank 1 Best – 5 Worst 1 Conclude project immediately post payroll remediation 5 3 15 2 2 Procure alternative new system 1 4 4 4 3 Outsource Payroll/HR Services 3= 1 3 5 4 Purchase Shared Services (OLA provider) 3= 2 6 3 5 Deliver existing project specification - Phase 2 4 5 20 1 4.7.4 The option that ranks most highly based on the above evaluation is for the council to seek to progress the development and implementation of the remaining elements of the iTrent project (Phase 2), in order to maximise the benefits from its investment, as outlined in the original business case, subject to affordability. 5.0 CONCLUSION 5.1 A number of benefits have been delivered to date, with a remedial action plan in place to resolve a number of unforeseen post implementation issues. Remedial work has required the redirection of resources and the available project budget has now been fully spent. 5.2 There is an opportunity to deliver further benefits, in line with the original project objectives. The continued development and implementation of the remaining project elements, at an additional cost, is deemed to deliver best value to the council and its employees, as evidenced by the cost benefit analysis. 6.0 IMPLICATIONS 6.1 Policy – There are no policy implications from this report. Page 125
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6.2 Financial – Additional resources of £480k required, to be met from earmarked reserves. 6.3 Legal – None. 6.4 HR – The final completion of the iTrent project will improve employee and manager experience and efficiency through a fully automate online HR/Payroll system. 6.5 Integrated Impact Assessment - An Integrated Impact Assessment has been undertaken and found to have positive impacts. 6.6 Climate Change – Greater levels of automation, reduction of duplication and reduction in emails general will reduce the energy required for processing. 6.7 Risk – An effective HR and Payroll system that maximises automation of pay and contractual processes will serve to reduce financial, audit and reputational risks. 6.8 Customer Service – The full implementation of the new system will result in improved experience for all employees, managers, starters and leavers through user friendly, automated processes. 6.9 The Rights of the Child (UNCRC) – None. Kirsty Flanagan Executive Director with responsibility for Customer Support Services and Financial Services 03 April 2025 Councillor Mark Irvine, Policy Lead for Customer Support Services Councillor Ross Moreland, Policy Lead for Finance and Commercial Services For further information contact: Jane Fowler, Head of Customer Support Services Jane.Fowler@argyll-bute.gov.uk Carolyn Earl, Interim Head of Financial Services Carolyn.Earl@argyll-bute.gov.uk Page 126
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APPENDICES Appendix 1 – Business Case Executive Summary Appendix 2 – Cost Benefit Analysis Considerations Page 127
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1 of 3 01/03/20 APPENDIX 1 HR and payroll systems replacement - summary of business case 1. Summary The Council implemented its current core HR & payroll software application, Resourcelink, over 20 years ago. A number of other systems support some specific HR functions. For a number of reasons, set out in the attached business case and summarised below, the core Resourcelink application and associated systems are no longer fit- for-purpose for both the current and the future needs of the organisation. Additionally, support for the main Oracle EBS system used by Financial Services to manage the General Ledger and Accounts Payable functions ends in December 2021. For reasons of PSN and Cyber Essentials Plus compliance, and also broader cyber-security protection of a business critical system the council depends on, it is not practical for Finance to use this system beyond April 2022. The council therefore has an opportunity to look to consolidate the ICT systems for both these services onto a single ERP (Enterprise Resource Planning) system which could support the requirements for both in an integrated manner. 2. Detail The HR and payroll systems are not fit for purpose as they do not provide best value in three areas – a) Effective and efficient way of paying staff - • Resources currently available within the HROD team do not meet processing demand. • Some process automation has been implemented however the volume of transactions has continued to increase due to the changing organisation demographic. • This has resulted in high volumes of payroll errors submitted by services • Unplanned system downtime reduces further the processing time available to the team. b) Efficient and effective way of storing, processing and reporting on employee data - • Employee data is held across 6 systems. Most data transfer between them is manual. • Human error and duplication of data reduces the integrity of reporting. • multiple log ins for different systems wastes time c) Intuitive user interface to manage the employment relationship quickly and effectively - • Customers find the HR systems are not intuitive, and the automated processes are time consuming and create more work for managers and staff. • More errors occur, reducing satisfaction and damaging reputation • Reporting is difficult to access and very limited Page 128
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2 of 3 01/03/20 In 2019 the council published Requests for Market Information (RFIs) for the replacement of Oracle EBS and ResourceLink. Responses were received from a range of suppliers, some on the basis of replacing just one of the two systems, but others proposing a single solution to cover both Financial Services and HR/Payroll. A significant commitment of human resource would be required from both services to a project team working on the planning, implementation and testing of the solution for a period of up to 2 years. 3. Options Option 1 - Do nothing – not viable as outlined above Option 2 – Full procurement to replace Resourcelink and some associated systems The responses to the RFI gave a very wide range of capital costs for replacing Resourcelink, whose supplier Zellis declined to indicate any costs at all until a full procurement is undertaken. A reasonable mid-point of capital costs across the responses is £300,000, with similar annual revenue costs of £120,000, as at present. Advantages - Exploring these solutions further in a full procurement would allow the team to fully evaluate the products available, and also the possibilities of using existing corporate workflow management tools such as the Oracle CRM for managing HR functions, perhaps feeding into a separate payroll system that is part of Finance’s solution. Disadvantages - May not provide as efficient results as a single integrated ERP system. Option 3 - Joint approach with Financial Services – single ERP solution There could be significant benefits from implementing a single ERP system to support the needs of both services. These could include: • Reduction in the duplication of data being held in multiple systems • Improved reporting from a single information manage system representing a “single source of truth” that both services can rely on. • Improved data integration leading to faster, more efficient data processing • The payroll function moving to finance in 2020 could increase efficiencies even further Advantages – allows Financial Services and HR/Payroll to fully investigate the potential benefits of a single ERP solution. Similar capital costs to Option 2. Disadvantages – likely involves an overall increase to on-going revenue costs. One supplier (Technology One) responded to the RFI with total revenue costs of £106,700 pa for both Finance and HR, but the other three ERP providers fall into a much higher price bracket: Oracle Cloud approx. £495,000 pa approx. £505,414 pa Page 129
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3 of 3 01/03/20 Edenhouse (SAP Reseller) Unit 4 approx. £550,000 pa It is hoped that these increased revenue costs will be offset to some extent by operational savings achieved from the closer integration of Finance and HR processes and procedures. 4. Recommendation The preferred approach is to initially coordinate the replacement of Resourcelink with the EBS replacement. On that basis the business case recommends developing option 3, with the caveat that if after investigation of the ERP approach the cost-to- benefit ratio is unfavourable, an HR/payroll solution would be pursued as outlined in option 2. SMT is asked to endorse the ICT Steering Board’s decision to approve the following ICT capital allocation, and to consider how the staff back-fill and additional revenue costs will be met: • £300,000 ICT capital to allow the procurement of the replacement of Resourcelink and related systems supporting HR functions; • Temporary resource within HR and payroll to be backfilled for the duration of the implementation project, from July 2020 to April 2022, at a cost of approximately £100,000. Page 130
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1 APPENDIX 2 iTrent HR and Payroll Systems Replacement Project Options Appraisal - Cost Benefit Analysis Considerations Option 1 Conclude project immediately post payroll remediation Cost Implications Benefits Realisation (Business Case Expected Outcomes) • Contractual commitments - iTrent annual license fees to December 2027 @ £115k p.a. (17 modules) • Opportunity cost of software/systems not decommissioned through development/implementation of residual iTrent modules: MyOptions (Time and Attendance); Totara (Learning and Development); and Civica (Electronic Document Management) • Approved recurring future years savings target not delivered • Opportunity cost - Redirection of resources (service managers) not possible • Opportunity cost – potential restructuring savings (HR/Payroll) • Sunk costs – UAT, systems configuration, training etc incurred to date, in respect of modules yet to be implemented • Basic payroll function operational • Limited benefits realised to date, however, not all modules purchased have been developed/implemented (those remaining would be included as Phase 2) • Functions that were identified as business benefits in the Business Case and PID will not be delivered (automation with improvements in speed and accuracy) and manual processing will continue • Benefits not realised in respect of: Recruitment and Onboarding; Time and Attendance; and Case Management Page 131
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2 Option 2 Procure alternative new system Cost Implications Benefits Realisation (Business Case Expected Outcomes) • Contractual commitments - iTrent annual license fees to December 2027 @ £115k p.a. • Sunk costs – iTrent systems purchase, project costs to date • Additional purchase costs of alternative system (2 other bids evaluated, as part of original procurement exercise, alongside iTrent - both £500k higher costs over 5 year period) • Additional project costs of procurement, development and implementation of alternative (2 year lead-in) • Delayed realisation of savings • Risk that existing software/systems may not be fully decommissioned, depending on new system specification (iTrent modules, MyOptions, Totara, Civica) • Assume similar to full development and implementation of all iTrent modules (Option 5), however, element of uncertainty, as not tested Additional Risks: • Reputational damage re ‘sunk costs’ Page 132
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3 Option 3 Outsource Payroll/HR Services Cost Implications Benefits Realisation (Business Case Expected Outcomes) • Contractual commitments - iTrent annual license fees to December 2027 @ £115k p.a. (17 modules) • Sunk costs – iTrent systems purchase, project costs to date • There are companies in the market offering payroll and elements of HR services but not full suite – elements would require to be delivered in-house – likely to be more expensive overall • Potential offsetting recurring savings from redundant payroll/HR elements • Potential redundancy costs • Client function requires to be retained • Potential additional costs to mitigate increased data protection risk • Additional recurring contract management costs • Basic payroll function • Likely to be limited benefits realised in respect of Business Case expected outcomes Additional Risks: • Reputational risk around potential redundancies • TU engagement/agreement required, potential TUPE transfer • Reputational damage re ‘sunk costs’ • Research (limited) suggests public bodies that have outsourced payroll/HR, subsequently brought back in- house due to cost/quality concerns Option 4 Purchase Shared Services (OLA provider) Cost Implications Benefits Realisation (Business Case Expected Outcomes) • Similar to Option 3, however, potential future shared services model would be expected to deliver savings • Whilst an option in principle, in practice, no proven market or reliable cost estimate • Similar to Option 3, however, potential opportunity for a future model, to realise benefits of shared agreed outputs, service specification etc, although likely to be challenges, where policies, terms and conditions not aligned Page 133
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4 Option 5 Deliver existing project specification (Phase 2) Cost Implications Benefits Realisation (Business Case Expected Outcomes) • Additional non-recurring cost estimated at £567k (prior to potential mitigations) over 2 years 2024-26 • Potential additional cost mitigations estimated at £199k (residual unfunded £366k) • Recurring future savings will provide payback for additional investment (extended period) • Additional project costs could be capitalised if more affordable • Potential future opportunity to generate additional income/reduce costs through provision of payroll/HR services to other local authorities (shared services model) • Full benefits realised, in line with project expected outcomes, as set out within original business case Page 134
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 PROPOSED AMENDMENT TO THE AGE AT WHICH AN LPGS EMPLOYEE CAN MAKE AN APPLICATION FOR FLEXIBLE RETIREMENT 1.0 EXECUTIVE SUMMARY 1.1 It is proposed the Council should amend its existing Flexible Retirement Procedure to allow Scottish Local Government Employees (SLGE) aged 55 and over with at least two years’ pension scheme membership to be able to make a request for flexible retirement. 1.2 In order to do this an amendment to the Council’s Pensions discretions policy for Scottish Local Government Employees is required. It is recommended that Policy and Resources Committee approves the proposal to amend the qualifying age of flexible retirement to 55 and approve the changes to the Pensions Discretion Policy to allow this to be implemented. RECOMMENDATIONS i. The Policy and Resources Committee approves the proposal to amend the qualifying age to request flexible retirement to employees aged 55 and who have at least two years pension scheme membership. ii. The Policy and Resources Committee approve the amendment to the Pensions Discretions Policy as outlined below to support the above proposal if agreed. This will continue to allow for discretion to be applied in exceptional circumstances in relation to the Council rather than the employee accepting the actuarial strain. Page 135 Agenda Item 11
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE CUSTOMER SUPPORT SERVICES 8 MAY 2025 PROPOSED AMENDMENT TO THE AGE AT WHICH AN LPGS EMPLOYEE CAN MAKE AN APPLICATION FOR FLEXIBLE RETIREMENT 2.0 INTRODUCTION 2.1 Flexible Retirement enables the employee to access their pension benefits while continuing to work, through either a reduction in working hours or grade. An employee of the approved age can request Flexible Retirement. The request requires to be considered but does not require to be granted, it is at the discretion of the Council as employer. 2.2 The Council currently has a Flexible Retirement process for SLGE employees in place that sets the qualifying age that someone can make a request to flexibly retire at 60 years of age. The Local Government Pension Scheme (Scotland) Regulations 2018 allows for this to be reduced to 55. Many local authorities have set 55 years of age as the qualifying age for making a flexible retirement request. Teachers are covered by a separate pension scheme which includes provisions for similar phased retirement arrangements commencing at age 55. 2.3 To support succession planning it is proposed that the Council should amend its existing Flexible Retirement Procedure to allow employees aged 55 and over with at least two years’ pension scheme membership to be able to make a request for flexible retirement. 2.4 It is anticipated that in cases where there is any actuarial strain identified that the employee who is choosing to flexibly retire will accept that strain cost and not the Council. 2.5 In exceptional cases (for example significant workforce planning risks) and only in circumstances that are initiated by the employer, the discretions policy allows for the Council to choose to accept the actuarial strain rather than the employee. This would require scrutiny and sign off by an Executive Director. 2.6 It is intended that once the revised flexible retirement procedure is signed off that an effective communication strategy is adopted to ensure that all employees are aware of the procedure. Page 136
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3.0 RECOMMENDATIONS 3.1 The Policy and Resources Committee approves the proposal to amend the qualifying age to request flexible retirement to employees aged 55 and who have at least two years pension scheme membership. 3.2 The Policy and Resources Committee approve the amendment to the Pensions Discretions Policy as outlined below to support the above proposal if agreed. This will continue to allow for discretion to be applied in exceptional circumstances in relation to the Council rather than the employee accepting the actuarial strain. Proposal that the following change be made to the wording in the Pensions Discretions Policy. Amend this: R29(7)* & TP11(2) Whether all or some benefits can be paid if an employee reduces their hours or grade prior to age 60 (flexible retirement) Argyll & Bute Council may exercise this discretion. Arrangements and eligibility criteria are set out in the Council’s Flexible Retirement Procedure To this: R29(7)* & TP11(2) Whether all or some benefits can be paid if an employee reduces their hours or grade prior to age 55 (flexible retirement) Argyll & Bute Council may exercise this discretion. Arrangements and eligibility criteria are set out in the Council’s Flexible Retirement Procedure 4.0 DETAIL 4.1 It is proposed that the Council should amend its existing Flexible Retirement Procedure to allow employees aged 55 and over with at least two years pension scheme membership to apply for flexible retirement. The current scheme allows those over 60 to apply but the Local Government Pension Scheme (Scotland) Regulations 2018 allowed this to be reduced to 55. There is a proposal that this will rise to age 57 years from 6 April 2028 but the Scottish Government have not yet confirmed this. If approved and while amending the age, we propose to put in place a more user friendly and efficient process for employees wishing to explore flexible retirement as a possibility. 4.2 Flexible Retirement enables the employee to access their pension benefits whilst continuing to work through either a reduction in working hours or grade. Page 137
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An employee of the approved age can request Flexible Retirement but the request requires to be approved by the Council before it can be progressed. 4.3 In our most recent Strategic Workforce Planning report, it was identified that like other Local Authorities in Scotland, we have an ageing workforce with around half of our employees being currently age 50 and over. Strategic Workforce Planning Priorities 2024-25 The Council values the skills and knowledge of this demographic within our workforce and the advantages to the council in reducing the age for flexible retirement would be in the improved succession planning and scope to increase growing our own activities. The advantages for the employee is that it can help ease employees into retirement by giving them access to pension benefits and to continue earning a salary. 4.4 Reducing the age for Flexible Retirement may give more scope for creation of trainee posts or sharing of duties in preparation for the future ensuring that replacements can work alongside these employees sharing that skills and experience in a structured way before they exit the organisation, and the Council is left with a skills shortage or a labour shortfall. 5.0 CONCLUSION 5.1 That the Policy and Resources Committee agree to amend the qualifying age to request flexible retirement from 60 to 55 but still allowing for discretion to accept actuarial strain in exceptional circumstances. 5.2 That following approval of the revised Flexible Retirement Guidance and the revision of the qualifying age of flexible retirement by the Policy and Resources Committee, that the revised Flexible Retirement Procedure be communicated to employees in June 2025. 6.0 IMPLICATIONS 6.1 Policy: Amendment to the Pensions Discretions Policy as outlined above Pensions discretion policy | The Hub 6.2 Financial: There are no immediate financial implications as a result of the amendment. However, there will be a reduction in the pension payments to the employee should they accept an actuarial reduce pension or a cost to the Council should it exercise its discretion to waive this. 6.3 Legal: None – the policy meets statutory obligations. Page 138
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6.4 HR: None – the application of the Flexible Retirement Procedure is monitored by HR to ensure consistency of approach. 6.5 Fairer Scotland Duty: 6.5.1 Equalities – Protected Characteristics 6.5.2 Socio Economic Duty 6.5.3 Islands Discretions are determined by pension regulations with local authorities determining whether or not to exercise a specific discretion. A number of discretions are age specific but again this is not imposed by the Council but is a requirement of the Regulations. Nevertheless, discretions that are age specific may give rise to an adverse impact on account of age. To mitigate this impact, discretions will be applied in a fair, consistent and transparent manner. 6.6 Climate Change: None. 6.7 Risk: The Council must publish its Policy on Discretions under the Local Government Pension Scheme (Scotland) Regulations 2018. HR will monitor the application of the policy and the Flexible Retirement Procedures to ensure fairness and consistency. 6.8 Customer Service: The provision of a Policy on Discretions will make it clear to both current employees and deferred members the council’s position on the discretions and in what circumstances they may be used. 6.9 The Rights of the None. Child (UNCRC): Kirsty Flanagan, Executive Director with responsibility for Customer Support Services Policy Lead: Councillor Mark Irvine April 2025 For further information contact: Jane Fowler, Head of Customer Support Service, jane.fowler@argyll-bute.gov.uk Susan Hamilton, HR Operations Manager, susan.hamilton2@argyll-bute.gov.uk Page 139
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE DEVELOPMENT AND ECONOMIC GROWTH 8 MAY 2025 PLACE BASED INVESTMENT 2025/26 – PBI PROJECTS AND ALLOCATION CROWN ESTATE 2025/26 – UPDATE 1.0 EXECUTIVE SUMMARY 1.1 The Scottish Government have indicated that Argyll and Bute Council will be allocated funding of £496,000 for financial year 2025/26 from its Place Based Investment (PBI) Programme. It should be noted that at the time of writing this report formal confirmation of funding has yet to be received from the Scottish Government. The purpose of this report is to seek members formal approval for the projects to be supported via this year’s PBI funding allocations as detailed in Table 1. 1.2 This report follows on from the email communication to all Elected members from the Executive Director with responsibility for Development and Economic Growth suggesting projects that could be funded by PBI and seeking members views on these and other suggestions which would fit within the funds criteria and timeline. 1.3 It should be noted, that no formal funding commitment will be made until such time as the PBI budget for 2025/26 is confirmed in writing by the Scottish Government 1.4 The report also highlights that members will require to give consideration to the Crown Estate (CE) funding for 2025/26. Whilst the Council has not yet been advised of the formal allocation it is considered, based on previous year’s allocations, that a prudent estimate of £0.8m of anticipated funding in 2025/26, should be considered. 1.5 A further report on the proposed allocation of the Crown Estate Funding for 2025/26 will be brought forward to the 21st August meeting of the Policy and Resources Committee to allow sufficient time for third party projects submitted on the Council’s Aspiring Places Portal to be considered for potential funding in an open and transparent manner. Page 141 Agenda Item 12
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1.6 The approach being taken reflects the decision taken at the Policy and Resources Committee in August 2022 whereby it was agreed that suggestions for future years of Placed Based Investment and Crown Estates funding were welcomed from all Elected Members, and that it would be beneficial for any future options to be discussed by Elected Members in advance of confirmation of these funds. 1.7 The Executive Director with responsibility for Development and Economic Growth has written to all Councillors seeking suggestions for potential projects which would fit within the CE funding criteria and timelines. At the time of writing this report, project proposals have been received from 4 elected members. RECOMMENDATIONS It is recommended that Policy and Resources Committee: a) Consider and agree to the allocation of the Place Based Investment funding for 2025/26 to the projects in Table 1, paragraph 4.6 subject to confirmation of funding. b) Note that Transformation Projects and Regeneration Team will liaise with colleagues on the Aspiring Places project to determine potential third party projects to be considered for Crown Estates funding. c) Note that, following consultation with all elected members and key stakeholders, a further report on the proposed allocation of the Crown Estate Funding for 2025/26 will be brought to the 21st August meeting of the Policy and Resources Committee. Page 142
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE DEVELOPMENT AND ECONOMIC GROWTH 8 MAY 2025 PLACE BASED INVESTMENT 2025/26 – PBI PROJECTS AND ALLOCATION CROWN ESTATE 2025/26 – UPDATE 2.0 INTRODUCTION 2.1 The Scottish Government have indicated that Argyll and Bute Council will be allocated funding of £496,000 for financial year 2025/26 from its Place Based Investment (PBI) Programme. It should be noted that at the time of writing this report formal confirmation of funding has yet to be received from the Scottish Government. 2.2 The purpose of this report to ask members to agree in principle to the allocation of Argyll and Bute Place Based Investment (PBI) for 2025/26 as detailed in Table 1. It should be noted, that no formal funding commitment will be made until such time as the PBI budget for 2025/26 is confirmed in writing by the Scottish Government. 2.3 The projects proposed are considered to fit strongly with the PBI criteria and deliver on the Council’s economic development priorities. All of the projects suggested will add value to investment that has already been made by the Council, deliver on our regeneration outcomes for our places, take account of available officer resources and are deemed to be deliverable within the 2025/26 financial year (a key requirement of the funding). 2.4 The purpose of this report is also to highlight to members that consideration will also need to be given to Crown Estate (CE) funding that is expected within 2025/26. Although the CE allocation for 2025/26 is not yet confirmed, in previous years it has been recommended that the Council could commit up to £0.8m of anticipated funding in advance of formal notification and this would again be recommended for 2025/26. 2.5 In order to advance this process and as agreed at the Policy and Resources Committee in August 2022, the Executive Director with responsibility for Development and Economic Growth has written to all Councillors seeking suggestions for potential projects which would fit within the CE funding criteria and timelines. At the time of writing this report, project proposals have been received from 4 elected members. Page 143
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2.6 A report will be brought back to the August meeting of the Policy and Resources Committee for formal approval of the proposed projects for 2025/26 CE funding. This is to allow sufficient time for third party projects submitted on the Council’s Aspiring Places Portal to be considered for potential funding in an open and transparent manner. Members are asked to note that this is a requirement of subsidy control legislation. 3.0 RECOMMENDATIONS 3.1 It is recommended that Policy and Resources Committee: a) Consider and agree to the allocation of the Place Based Investment funding for 2025/26 to the projects in Table 1, paragraph 4.6 subject to confirmation of funding. b) Note that Transformation Projects and Regeneration Team will liaise with colleagues on the Aspiring Places project to determine potential third party projects to be considered for Crown Estates funding c) Note that, following consultation with all elected members and key stakeholders, a further report on the proposed allocation of the Crown Estate Funding for 2025/26 will be brought to the 21st August meeting of the Policy and Resources Committee. 4.0 DETAIL 4.1 The 2020 Programme for Government committed to establishing a Place Based Investment Programme (PBIP), linking and aligning place-based funding initiatives. The Scottish Government confirmed that Local Authorities would receive a share of the PBIP funding over a 5-year period, including the initial year 2021/22, to support and advance place-based investment and build on the strong partnership currently existing through the Regeneration Capital Grant Fund. 4.2 Argyll and Bute Council’s allocation for year 1 (2021/22) was £821,000. The Council’s allocations for year (2022/23) was £714,000. The allocation for 2023/24 was £496,000. No PBIP allocation was made in 2024/25 due to budget pressures. The allocation for 2025/26 is anticipated to be £496,000 although the Council are awaiting formal confirmation from the Scottish Government. 4.3 The main objectives of the PBIP are: • to link and align place-based initiatives, and establish a coherent local framework to implement the Place Principle. Page 144
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• to support place policy ambitions such as town centre revitalisation, community led regeneration, 20 minute neighbourhoods and Community Wealth Building; • to ensure that all place-based investments are shaped by the needs and aspirations of local communities; and, • to accelerate our ambitions for net zero, wellbeing and inclusive economic development, tackling inequality and disadvantage, community involvement and ownership. 4.4 The challenge in respect of the fund is to identify projects that meet the place- based criteria, and are able to be delivered within the financial year in which funding is awarded taking cognisance of limited staff resources. Projects to be delivered under the 2025/26 allocation need to be delivered in a 9 month period and therefore need to be sufficiently well advanced in terms of their development. The Council will also require to be content that any third party projects can be delivered on time, satisfy any subsidy control requirements, and meet the funding criteria set out above. 4.5 As with previous year’s PBI funding, the focus for this year’s programme is on projects that are at delivery stage and can be completed in financial year 2025/26. The projects need to fit with the PBIP criteria, have the ability to build on previous investments, and require the resources to be in place to ensure delivery within the timescales required by the Scottish Government. 4.6 The projects identified in Table 1 have been selected based on their strong fit with PBI funding criteria and all are considered deliverable in the 2025/26 financial year. Table 1 Place Based Investment 2025/26 Allocation Project Consideration Fit with Criteria 2025/26 Place Based Investment Albert Pier – regeneration works to formalise parking arrangements and provide dedicated facilities for visiting coaches. Project represents next phase of works following proposed demolition of vacant property on Albert Pier using Crown Estates funding. Strong fit with PBI – adds value to previous works, deliverable within 2025/26. £100,000 Victoria Hall, Campbeltown – repair and refurbish entire front elevation on prominent town centre building. Adds value to previous town centre regeneration activities funded via CARS. Strong fit with PBI – builds on previous funding secured, council project, deliverable within time frame. £100,000 Page 145
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Shopfront and business support - flexible fund to support businesses with capital improvements to shopfronts/buildings supporting previous regeneration investment. Project can deliver town centre enhancements across Argyll and Bute. Strong fit with PBI – adds value to existing funding secured, deliverable within time frame, resources and expertise in place to deliver these works. £56,000 CCTV – upgrade to CCTV in town centres. Long standing aspiration to upgrade town centre CCTV. Partnership project with Police Scotland and strong community safety focus. Deliverable within time frame with resources in place. This will be a capital only investment subject to agreement with Police Scotland. Up to £100,000 Helensburgh Outdoor Museum - commission artist/arts organisation to deliver community engagement and to further develop the Outdoor Museum as a heritage-led attraction for Helensburgh. This will deliver further artworks increasing the potential for the outdoor museum to act as a key tourist attraction for Helensburgh. Strong fit with PBI, adds value to existing projects, deliverable within time frame, resources in place. £80,000 Rockfield Centre Oban- Outdoor Works Phase 2. Enhancements to external space including improved car park and installation of EV charging facilities. Provides enhanced events space and assists with on-going operational costs helping to make this key town centre facility more sustainable by increasing the potential for revenue generation. Strong fit with PBI, adds value to previous funding secured, deliverable within time frame. £60,000 TOTALS £496,000 4.9 The projects identified above all meet the funding criteria for the PBI programme and all are considered to be deliverable within the 2025/26 financial year. It should however be noted, that capital projects are becoming more challenging to deliver and as such, an element of flexibility may be required if it becomes evident that projects are no longer viable. Page 146
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5.0 CONCLUSION 5.1 The relatively tight timescales associated with the PBI fund, combined with the large number of existing projects being delivered by the council, make for a challenging place based investment programme. The projects identified above all meet the funding criteria for the PBI programme and are considered deliverable within the 2025/26 financial year. These projects also build on investment already in place in our town centres and will support projects being delivered through other place-based work such as the Lochgilphead and Helensburgh CARS. Note that a further report on the proposed allocation of the Crown Estate Funding for 2025/26 will be brought forward to the 21st August meeting of the Policy and Resources Committee to allow sufficient time for third party projects submitted on the Council’s Aspiring Places Portal to be considered for potential funding in an open and transparent manner. 6.0 IMPLICATIONS 6.1 Policy - There is a need to comply with the Scottish Government ‘place’ policies as outlined in paragraph 4.3 and associated guidance for the Fund. 6.2 Financial - The Scottish Government expect that any uncommitted funds by 31st March 2026 will be returned to Scottish Government. 6.3 Legal – Projects must be delivered in line with Central Government funding criteria. This includes compliance with subsidy control and policies such as Fair Work. 6.4 HR – Projects will be delivered from existing staff resources in partnership and funding will be managed by the Transformational Projects and Regeneration Team within DEG. 6.5 Fairer Scotland Duty: 6.5.1 Equalities - protected characteristics - None 6.5.2 Socio-economic Duty - The Fund will support local economies through place-based centre regeneration activity. 6.5.3 Islands - The Fund will support island economies through place-based regeneration activity and has the potential to align with, and add value to, the Islands Programme. 6.6 Climate Change – Management of whole life carbon emissions will be factored into projects. 6.7 Risk - In order for each project to progress to delivery stage, a fully let contract must be in place by 31st March 2026. The projects will be continually monitored to ensure that funds can be reallocated to another Place Based Investment Fund project to avoid having to return any uncommitted funds to Scottish Government at this time. Page 147
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6.8 Customer Service – None. 6.9 The Rights of the Child (UNCRC) – None. Kirsty Flanagan, Executive Director with responsibility for Development and Economic Growth Councillor Jim Lynch, Policy Lead for Economic Development, Islands, Rural Communities and Housing 7th April 2025 For further information contact: Fergus Murray - Head of Development and Economic Growth fergus.murray@argyll-bute.gov.uk Jonathan Welch - Transformation Projects and Regeneration Manager jonathan.welch@argyll-bute.gov.uk Page 148
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ARGYLL & BUTE COUNCIL POLICY & RESOURCES COMMITTEE LEGAL AND REGULATORY SUPPORT 8 May 2025 EXTRACT OF MINUTE ENVIRONMENT, DEVELOPMENT AND INFRASTRUCTURE COMMITTEE HELD ON 20 MARCH 2024 *10. HELENSBURGH WASTE TRANSFER STATION PROJECT UPDATE The Committee gave consideration to a report providing an update on the Helensburgh Waste Transfer Station project following the completion of the Options Appraisal and making a recommendation in relation to the next steps for this project and associated budgets. Decision The Environment, Development and Infrastructure Committee – 1. noted that the proposed Helensburgh Waste Transfer Station no longer provided the optimum solution to ensure Biodegradable Municipal Waste compliant disposal arrangements in the Helensburgh and Lomond area; 2. agreed that officers should not progress further with the development and delivery of the Helensburgh Waste Transfer Station Project; 3. recommended to the Policy and Resources Committee that the remainder of the £3m of budget earmarked for this project be retained to support other funding related pressures within the waste service; and 4. noted that should circumstances change, specifically the cost benefit ratio, that the scheme could be revisited. (Reference: Report by Executive Director with responsibility for Roads and Infrastructure Services dated February 2025, submitted) Page 149 Agenda Item 13
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ARGYLL AND BUTE COUNCIL ENVIRONMENT, DEVELOPMENT AND INFRASTRUCTURE COMMITTEE ROAD AND INFRASTRUCTURE 20 MARCH 2025 HELENSBURGH WASTE TRANSFER STATION PROJECT UPDATE 1.0 EXECUTIVE SUMMARY 1.1 This report provides an update on the Helensburgh Waste Transfer Station project following the completion of the Options Appraisal and makes a recommendation in relation to the next steps for this project and associated budgets. 1.2 The requirement for the Council to develop a Waste Transfer Station to service the Helensburgh and Lomond area was set out in a report to this Committee on 21 December 2022 as part of a report entitled “Waste PPP Options Appraisal”. That report provided an initial cost estimate for the project of £3m. 1.3 Funding for the development of a Waste Transfer Station to serve the Helensburgh and Lomond area was approved by Council in February 2023 as part of the Budget setting meeting. At that meeting Council approved a budget of £3.5m in relation to preparations for the upcoming Biodegradable Municipal Waste (BMW) Ban as part of series of additional capital allocations for “investing in Argyll and Bute’s Priorities”. The Helensburgh Waste Transfer Station project with an initial estimated cost at that time of £3m was the largest in a number of projects to be funded from that budget, the other £0.5m being intended to support the cost of converting the existing Mechanical and Biological Treatment (MBT) facilities into waste transfer stations. 1.4 Following budget approval officers undertook the design and other activities required to move the project to an advanced stage of maturity whereby a full works tender pack was prepared and planning approval achieved. The project achieved this level of maturity in early January 2025. 1.5 Prior to issuing the works tender to the construction market a project review using the HM Treasury Green Book approach of the production of an Outline Business Case was undertaken in order to assess that the project remained the best value for money method through which the Council could be assured that its waste disposal arrangements in the Helensburgh and Lomond area are compliant with the upcoming BMW Ban. This project review took place Page 151
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across the period December 2024 to early January 2025. 1.6 The project review (described at paragraph 1.5 of this report) determined that the Helensburgh Waste Transfer Station Project no longer provides the optimum solution to ensure BMW compliant waste disposal arrangements in the Helensburgh and Lomond area, is not required to ensure BMW compliance and does not offer a good return on investment (value for money) for the Council. RECOMMENDATIONS It is recommended that the Environment, Development and Infrastructure Committee:- 1. Notes that the proposed Helensburgh Waste Transfer Station no longer provides the optimum solution to ensure BMW compliant waste disposal arrangements in the Helensburgh and Lomond area. 2. Agrees that officers should not progress further with the development and delivery of the Helensburgh Waste Transfer Station Project. 3. Recommends to the Policy and Resources Committee that the remainder of the £3m of budget earmarked for this project be retained to support other funding related pressures within the waste service. Page 152
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ARGYLL AND BUTE COUNCIL ENVIRONMENT, DEVELOPMENT AND INFRASTRUCTURE COMMITTEE ROAD AND INFRASTRUCTURE 20 MARCH 2025 HELENSBURGH WASTE TRANSFER STATION PROJECT UPDATE 2.0 INTRODUCTION 2.1 This report provides an update on the Helensburgh Waste Transfer Station project following the completion of the Options Appraisal and makes a recommendation in relation to the next steps for this project and associated budgets. 3.0 RECOMMENDATIONS 3.1 It is recommended that the Environment, Development and Infrastructure Committee:- 1. Notes that the proposed Helensburgh Waste Transfer Station no longer provides the optimum solution to ensure BMW compliant waste disposal arrangements in the Helensburgh and Lomond area. 2. Agrees that officers should not progress further with the development and delivery of the Helensburgh Waste Transfer Station Project. 3. Recommends to the Policy and Resources Committee that the remainder of the £3m of budget earmarked for this project be retained to support other funding related pressures within the waste service. 4.0 DETAIL 4.1 The concept of the Council building and operating a Waste Transfer Station in the Helensburgh area was originally envisaged as a means to respond to the closure of the local landfill site at Auchencarroch, ensure that waste disposal operations for this area would be compliant with the upcoming ban on municipal waste to landfill, and respond to the withdrawal from the market of the waste off-taker historically utilised by the Council in the Helensburgh area. Following budget approval by Council in February 2023, the project was initiated with design, surveys, operational planning and regulatory approvals progressing. Page 153
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4.2 By mid-January 2024 the project was a relatively mature stage with detailed design complete and tender information ready to be issued to market for purposes of procuring a construction contractor with planning approval for the project having been secured (subject to a number of conditions as would normally be the case for a project of this nature). In progressing the project to this stage of maturity in the region of £190k had been expended on design and other related fees. 4.3 In the period between the initiation of this project following the February 2023 Council meeting and January 2025, the Council had successfully procured and implemented waste disposal arrangements for the Helensburgh and Lomond are that are BMW Ban compliant. These arrangements involve the Council’s Refuse Collection Vehicles travelling to a waste off-taker in Linwood (Paisely). As this is a circa 2-hour round trip these arrangements are less efficient than the previous arrangements whereby residual waste was taken to the Auchencarroch landfill site, but it is a BMW Ban compliant solution. As a BMW Ban compliant waste disposal solution has been secured the rationale for this project changed from being one that was required to ensure BMW Ban compliance to one that would be desirable provided it can be demonstrated to offer financial efficiencies to the Council when compared to the current arrangements. 4.4 At the direction of the Waste Strategy Project Board a project review was undertaken to determine the value for money of this proposed project. To progress this review consultants were appointed to produce an “Outline Business Case” in line with HM Treasury Green Book standards and in line with the Councils “Projects Pipeline” approach. The Outline Business Case was utilised by the Interim Head of Roads and Infrastructure to inform a review of the value for money of the proposed project. 4.5 The project review identified that the estimated cost of delivering the project stood at circa £3.6m, which is £0.6m higher cost than the currently available budget. The review also looked in detail at the financial savings that the project could achieve, for example through lowered vehicle fuel use, and compared these against the additional new costs of operating a Waste Transfer Station. This exercise determined that the running costs for the new facility would lead to an increase in the annual revenue costs for the service of between £110,704 and £207,326. In calculating this increase in costs two scenarios were considered: scenario 1) the efficiency in staff time would not be taken as a cashable saving with the staff being re-deployed to other activities, and scenario 2) the efficiency in staff time being taken as a cashable saving. As would be expected scenario 1 leads to the highest overall increase in costs. The table below shows a summary of the savings, additional new costs and overall cost increase in each scenario. Page 154
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4.6 In order to demonstrate the total cost to the Council of the proposed project the review modelled the revenue consequences of borrowing to fund the capital investment. While the financing approach for the capital investment may necessarily have required borrowing specifically for this project the benefit of developing this model is that it demonstrates the real-life cost of the capital investment. In line with standard Argyll and Bute Council methodology and HM Treasury Green Book guidance, the life of the asset and hence financing period has been assumed at a 60-year period at an assumed interest rate of 5.1%. This exercise determined that when both the additional running costs of the facility and the true cost of the capital are included the project would result in a total of between £304,082 and £400,704 as shown in the table below. As in the table above the difference between the two figures is a result of the scenarios described above in relation to staffing efficiency. 4.7 The project review recognised that constructing a Waste Transfer Station would bring benefits in relation to service resilience. In order to better understand the relative importance of these benefits an exercise was undertaken through market intelligence to assess the alternative waste off-take arrangements that would be open to the Council in the areas should the existing arrangements be put at risk at a future point. This exercise determined that there are other off-take Table 1.9 Ongoing Revenue Implications Cost per annum Fuel savings for fleet -£50,000 Increased fees from commercial waste -£11,821 Costs of waste transfer i.e. cost of hiring larger vehicles for transport to processing +£104,000 Additional staffing +£40,000 Reduction in Staffing -£96,622 Running costs inclusive of utilities, inspections, etc. +£125,148 Total with retained staffing +£207,326 Total with reduced staffing +£110,704 Table 1.10 Ongoing Revenue Implications with Capital Repayments Cost per annum Fuel savings for fleet -£50,000 Increased fees from commercial waste -£11,821 Costs of waste transfer i.e. cost of hiring larger vehicles for transport to processing +£104,000 Additional staffing +£40,000 Reduction in Staffing -£96,622 Running costs inclusive of utilities, inspections, etc. +£125,148 Capital Repayment +£193,378 Total with retained staffing +£400,704 Total with reduced staffing +£304,082 Page 155
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contractors in the area and while the costs may potentially be higher any increase would not be anticipated to be as high as the total cost (Capital and Revenue) associated with the development of the proposed Waste Transfer Station. 4.8 Recognising that the proposed project would be likely to result in fuel savings the review undertook an assessment of the likely reduction in transport related pollutants that would be expected to result from the construction of a waste transfer station and the bulking of waste from refuse collection vehicles onto articulated HGV’s. The results of this exercise are shown in the table below, while this demonstrates beneficial environmental gains these are not particularly high when considering the level of investment required to achieve them. Tonnes Value per tonne Annual value Carbon Reduction 197 £256 £50,349 Nitrous Oxide Reduction 0.78 £7,120 £5,584 Fine particulate Reduction 0.06 £81,847 £5,136 4.9 In order to complete the value for money assessment a Benefits Costs Ratio (BCR) was undertaken for both the Blackhill Waste Transfer Station and an alternative proposal for a facility at Sandhill Point. The results are shown below. A BCR of more than 1 shows positive value for money and it usually anticipated that a BCR well above 1 would be required for most projects. Present Value Costs Present Value Net GVA BCR Option 4: Sandpoint Marina Argyll & Bute £3.6m £2.8m 0.94 Scotland £3.6m £2.3m 0.78 Option 6a: Blackhill– Staff redeployment Argyll & Bute £7.7m £5.9m 0.77 Scotland £7.7m £7.1m 0.92 Option 6a: Blackhill– Staff reduction Argyll & Bute £5.8m £2.8m 0.49 Scotland £5.8m £4.7m 0.82 4.10 There are a number of wider cost pressures facing the waste service in the short-term. These include costs associated with resolving historic issues within the PPP contract with Biffa, and include:- • indexation and the disposal of excess Compost Like Output (CLO) Material from the MBT plants; Page 156
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• additional cost pressures resulting from ensuring compliance with the BMW Ban including the conversion of the existing MBT sites to Waste Transfer Stations; and • the cost of capping and restoration of the current landfill sites to meet the requirements of the BMW Ban and regulatory requirements for these sites once they are no longer in use. While initial estimates only of these costs are available at the current time, they are anticipated to be significantly higher than the currently available budgets even once taking into account the £1.5m in capital funding from the Scottish Government provided to support the costs of BMW ban compliance. 5.0 CONCLUSION 5.1 Having assessed the project from a number of different angles the review has concluded that the construction of a new Waste Transfer Station does not offer value for money to the Council. While the project does offer benefits in terms of operational efficiency, resilience and carbon reduction it is difficult to argue that these are of sufficient magnitude to justify either the initial capital investment or the ongoing revenue investment. If at a future point in time the operational circumstances change significantly then the project could be revisited and if required revived. With detailed design completed, planning approval (subject to conditions) achieved, and a construction tender pack compiled the project would be cable of being re-mobilised at a future time, recognising of course that planning and other approvals are time limited and may require to be re-visited. 5.2 With the waste service facing significant financial pressures in relation to BMW Ban compliance and the end of the PPP contract, as set out at 4.10, it is proposed that the remainder of the £3m initially earmarked for the development of the Helensburgh Waste Transfer Station project be re-allocated to support these wider cost pressures. Re-allocating the remainder of the earmarked budget for this project to these purposes would ensure this investment remains available for the purposes expressed by Council at its meeting in February 2023 when setting aside a budget of £3.5m in relation to preparations for the upcoming Biodegradable Municipal Waste (BMW) Ban as part of series of additional capital allocations for “investing in Argyll and Bute’s Priorities”. 6.0 IMPLICATIONS 6.1 Policy – None arising from this report. 6.2 Financial – The financial implications are set out in the body of this report. 6.3 Legal – None arising from this report. 6.4 HR – None arising from this report. 6.5 Fairer Scotland Duty: None known. Page 157
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6.5.1 Equalities - protected characteristics – None known. 6.5.2 Socio-economic Duty – None known. 6.5.3 Islands – None arising from this report. 6.6 Climate Change – The climate change considerations have been set out in the body of this report. 6.7 Risk – The risks associated with future service resilience in relation to the waste off-take market in the Helensburgh and Lomond area have been set out in the body of this report. 6.8 Customer Service – None arising from this report. 6.9 The Rights of the Child (UNCRC) – None arising from this report. Executive Director with responsibility for Roads and Infrastructure Services: Kirsty Flanagan Policy Lead for Roads, Transport and Amenity: Councillor John Armour February 2025 For further information contact: Stephen Hall, Interim Head of Road and Infrastructure Services stephen.hall@argyll-bute.gov.uk John Blake, Fleet Waste and Transport Manager john.blake@argyll-bute.gov.uk Page 158
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Policy and Resources Committee Work Plan 2025-2026 This is an outline plan to facilitate forward planning of reports to the Policy and Resources Committee. Date 7. Report Title Dept/Section How Often? Date Due Comments 8 May 2025 8. Budget Outlook 9. Financial Services 8 April 2025 10. HSCP Financial Position Financial Services 17 April 2025 11. Empty Property Relief for Businesses - Policy Update Financial Services 8 April 2025 Corporate Plan 2025 - 2027 12. Customer Support Services 8 April 2025 Artificial Intelligence Policy 13. Customer Support Services 8 April 2025 Equality Mainstreaming 2025 14. Customer Support Services 8 April 2025 15. I-Trent HR and Payroll Systems Replacement Project Update Customer Support Services 8 April 2025 Proposed Amendment to the Age at which an LPGS Employee Can Make an Application for Flexible Retirement Customer Support Services and Legal and Regulatory Support 8 April 2025 16. Place Based Investment 2025/26 - Place Based Investment Projects and Allocation & Crown Estate 2025/26 - Update Development and Economic Growth 8 April 2025 17. Helensburgh Waste Transfer Station Project Update Roads and Infrastructure Services 8 April 2025 Recommendation from EDI held on 20 March 2025 Page 159 Agenda Item 14
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Policy and Resources Committee Work Plan 2025-2026 This is an outline plan to facilitate forward planning of reports to the Policy and Resources Committee. Date 18. Report Title Dept/Section How Often? Date Due Comments August 2025 Financial Report Monitoring Pack 19. Financial Services Every meeting except May 20. Budget Outlook Financial Services Community Empowerment (Scotland) Act 2015 – Update on Expressions of Interest / Asset Transfer Requests 21. Commercial Services Date Report Title Dept/Section How Often? Date Due Comments October 2025 Financial Report Monitoring Pack Financial Services Every meeting except May Budget Outlook Financial Services Argyll And Bute Uk Shared Prosperity Fund Investment Plan Development and Economic Growth Date Report Title Dept/Section How Often? Date Due Comments December 2025 Financial Report Monitoring Pack Financial Services Every meeting except May Budget Outlook Financial Services Date Report Title Dept/Section How Often? Date Due Comments Page 160
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Policy and Resources Committee Work Plan 2025-2026 This is an outline plan to facilitate forward planning of reports to the Policy and Resources Committee. 19 February 2026 Financial Report Monitoring Pack Financial Services Every meeting except May 20 January 2026 Budget 2026-2027 Financial Services 22. Treasury Management Strategy and Annual Investment Strategy Financial Services Future Items – Date to be determined. Key Performance Indicators FQ2 – 2022/2023 – changing to Corporate Outcome Indicators Customer Support Services Annual Historic Environment Scotland Heritage and Place Programme – Opportunity for Place Based Heritage Funding Development and Economic Growth UK Shared Prosperity Fund – Argyll and Bute Investment Plan Development and Economic Growth Regular updates to be provided. Agreed 11.08.2022 Rothesay Pavilion - Rural Growth Deal Development and Economic Growth Update to be provided following approval of the Rural Growth Deal Full Business Case by the UK and Scottish Government. Crown Estate Allocation Development and Economic Growth Report to come with 2025/26 allocation. Page 161
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