Fife Council says it's facing a £3.3 million deficit this year out of a total budget of £800 million.
A sharp increase in demand for social care and children's services is being blamed.
A report has identified significant increases in demand for purchased places for children being taken into care and for care packages for adult and older people at a cost of over £10m. However this is offset by savings made as a result of continuing low interest rates and unused contingency funds.
Speaking after the meeting Council Leader Cllr David Ross explained,
"The most important thing arising from this report is that we have received assurances from officers that we will continue to meet our responsibilities to provide social care and to care for vulnerable children, despite the sharp rise in demand for these services we have seen this year.
"It is well known that Fife Council, in common with local authorities across Scotland, faces significant budget pressures and rising demand for services going forward, with a need to make further savings of £77m over the next 3 years.
"This report clearly shows that we are dealing with these pressures now, on a daily basis. These pressures are particularly challenging for social care and children’s services and there are three main reasons behind this.
"Firstly, although we have always budgeted for rising demand in these services with additional investment of £12m this year, the increase in demand we are now seeing is significantly more than previously estimated. This on its own accounts for the extra costs of £10m we need find to the end of this financial year.
"Secondly, the previous administration budgeted for a significant level of savings that were simply not achievable. We have already identified alternative means of meeting these unrealistic savings in social care and children's services, but this week we have also set aside the outstanding burden of savings on community learning, and halls and centres by using reserves. This will give these services the breathing space to remodel themselves on a sustainable basis without having to worry about finding these historic unachievable savings on top.
"Finally, it is evident that health and social care services across Scotland have been badly under funded by the Scottish Government. This isn’t about blame, it’s simply recognising the realities of the situation. Officers are quite clearly telling us that the position is the same across most of Scotland. NHS boards and council social care services are struggling to meet increases in demand for care with inadequate budgets.
"I will be writing to Alex Neil MSP, the Scottish Health Minister setting out the position in Fife and we are already working closely with NHS Fife to find the best way of dealing with these challenges at a local level. But without a significant injection of additional funding on a long term basis, health and social care services in Fife and across Scotland will seriously struggle to meet the needs of our communities.
"This position is made worse by the council tax freeze imposed on local authorities by the Scottish Government without any alternative means of raising additional funds. Councils no longer have any significant power to increase their income to meet these local needs and are almost totally dependent on grant funding from the Scottish Government.
"In conclusion, thanks to the prudence and professionalism of our officers, the Council continues to meet its social care responsibilities and to manage its budget well in difficult financial circumstances. I am not going to descend to responding to the name calling and quite frankly ludicrous accusations being bandied about by some members of the opposition. I would simply point out that the package of measures brought forward to manage this year's budget was agreed unanimously.
"No alternative approach is being suggested other than the wholesale privatisation of council services advocated by a handful of councillors that we have already rejected.
"In the longer term, we still face a huge financial challenge and unless something happens at central government level it is inevitable that the savings we are being forced to make will have a real damaging impact on services and staff. We will shortly be bringing forward our administration’s draft budget for next year and I look forward to engaging in discussion on this with a wide range of groups and individuals across Fife."
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