Scottish Fire and Rescue Service ‘faces £43m funding gap’

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The Scottish Fire and Rescue Service is facing a “significant potential funding gap”, according to Audit Scotland.

The public finance watchdog said a long-term financial strategy was urgently needed.

Audit Scotland warned that potential future reductions in funding could mean a budget gap of £42.7m by 2019/20.

The Scottish Fire and Rescue Service (SFRS) said work had already been undertaken to project future costs and savings.

The single national fire service was created two years ago by merging eight regional brigades. Audit Scotland said the merger was managed effectively.

The watchdog said SFRS made £16m of savings in the first year after the merger with no impact on the public and a continued reduction in casualties.

It said the service was on track to exceed expected cumulative savings of £328m by 2027/28.

But it warned that future cost pressures and likely reductions in funding could lead to a potential funding gap of £42.7m by the end of the decade.

‘Hard work’

The gap could be even higher if other services are protected during the coming period of public sector spending cuts, the watchdog said.

Caroline Gardner, auditor general for Scotland, said: “The creation of the Scottish Fire and Rescue Service was well managed. This achievement provides a valuable opportunity to share the lessons of how this was done with other public bodies going through a merger process.

“The service is reviewing how it will work in the future, and there is still a lot of hard work to do. Even without the funding gap identified in our report, a long-term financial strategy would be essential.

“It’s now crucial that the service agrees this strategy, and supporting plans, to show how it will close the funding gap and achieve savings by 2019/20 and beyond.”

The SFRS has a budget of £259.2m for 2015/6, which is a £31.5m reduction on the last year of the old regional brigades.

Audit Scotland said the vast majority of the fire service’s spending (79%) related to staff costs.

Frontline operations

SFRS Chief Officer Alasdair Hay said the “very positive report reflects the dedication of all our staff across the country”.

He added: “SFRS has already delivered very significant financial savings since its inception in 2012/13. These efficiencies will see a reduction to the organisation’s budget of £31.5m when compared to legacy services, while the cost base has risen by £16.7m.

“As the Audit Scotland report acknowledges, this has been achieved with no impact on frontline operations or to the public and the services they receive.

“Indeed, SFRS has delivered improvements during this period, including the extension of specialist resources across Scotland, providing a higher number of home fire safety visits than ever before and a continuing reduction in fire fatalities and casualties.

“The SFRS will, of course, continue to place community safety and firefighter safety at the forefront of any decisions which are made to ensure that we can continue to deliver the high quality service the public has come to expect from us.”

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