Coronavirus: Fears for future of services as thousands of staff furloughed

While trade unions say furlough cannot be used as a route to redundancy, economists have predicted many people on furlough will no longer have jobs when the funding scheme stops in October.

One industry body, Community Leisure Scotland, said there would need to be an “inevitable rethink” after the lockdown eases, predicting it could take up to two years for some public services to recover. 

Arms’-length external organisations (ALEOs) may be further impacted by the economic toll the pandemic has taken on councils, which were already struggling financially due to austerity measures well before the virus hit. Councils also say the majority of pandemic funding they were due to receive from the Scottish Government has yet to materialise.

Cosla, the umbrella organisation for Scottish councils, told the Scottish Parliament’s Local Government Committee that authorities have received no explanation for the delay in handing over the vital funds. The first instalment is understood to have been paid to local authorities last week. 

Figures obtained by The Herald show at least 17 of the country’s 32 councils have ALEOs that have taken full advantage of the UK Government’s furlough scheme. Six councils said they did not have ALEOs that qualified, or had none at all, while three said they had redeployed staff elsewhere and avoided the need to furlough anyone. Others did not respond with information. 

While the average business in the UK has furloughed about 58 per cent of its employees, the majority of ALEOs have had to furlough far more, with an average of 74% of their staff being put on leave. 

At least 10 organisations, mainly in the leisure sector, have had to put 90% or more of their workers on furlough while seven have furloughed fewer than one-third of employees. 

Moray Leisure Centre has the highest level, with 98% of its employees receiving funding from the Government Job Retention Scheme. Edinburgh Leisure has had to furlough 1,020 (97%) of its employees while lockdown continues, and 1,352 staff at High Life Highland, 90% of the workforce, have also been put on paid leave.

East Dunbartonshire Leisure and Culture, North Ayrshire’s KA Leisure and the South Lanarkshire Leisure and Culture Trust have all avoided furloughing staff. 

Almost 500 staff at the South Lanarkshire ALEO have volunteered to transfer to frontline areas, while in East Dunbartonshire staff have been maintaining facilities, helping the area’s vulnerable residents and taking fitness classes online. 

Ann Davie, depute chief executive at East Dunbartonshire Council, said: “Our workforce continues to work extremely hard - in exceptional circumstances - to ensure we are able to keep delivering vital services to our communities, including colleagues on the frontline, those working from home and employees who are undertaking different roles than they carried out prior to the pandemic.

READ MORE: Ian McConnell: Anyone seeing ‘addiction’ to furlough needs to take a look at reality of coronavirus crisis 

"EDLC Trust forged a strong online presence prior to the pandemic and has been building on that with a range of features, including live fitness sessions, cultural highlights and interactive events. Many of the Trust employees are also maintaining centres and venues, as well as helping to support the delivery of services across the wider council.” 

Kirsty Cumming, policy and engagement manager at membership organisation Community Leisure Scotland, said it could take between a year and two years for public culture and leisure services to recover. She said: “The majority of staff across our 27 members in Scotland are currently furloughed. Where financially possible, our members are seeking to pay the full 100% of salary for furloughed staff, with support from their local authority partners.

“The anticipated recovery period for public leisure and culture services is 12-24 months, with an inevitable need to rethink and reshape services and facilities to ensure these best meet the changed and diverse needs of their communities.” 

The inevitable rethink was mirrored by Cosla, which said operators were “hoping to eventually reinstate a level of service broadly similar” to that before lockdown. However, those areas where physical distancing is more difficult will take longer to reopen. 

A spokesman said: “Cosla is seeking to work with others to help inform and bottom out the challenges faced in planning for the return of culture and leisure services in a safe and sustainable way. This is being coordinated locally and is likely to be delivered in a way that best meets the needs of communities and ensuring ALEO, council and private sector facilities are run to the same safe standards, having carried out similar evaluations. 

“Whilst it is desirable for all sectors to restart at roughly the same time, it is inevitable some phasing will take place: those services that naturally have physical distancing will be first, and those with contact amongst the last.

"At this stage operators are hoping to eventually reinstate a level of service broadly similar to that provided prior to lockdown.” 

Trade unions have urged councils and their ALEOS to ensure staff have roles to return to when the lockdown eases, and urged the Scottish Government to provide funding to councils to help. 

Joanna Baxter, Unison Scotland head of local government, said: “Furlough cannot be a waiting room for redundancy. 

“We know a large number of members in ALEOs have been furloughed and we are working with those employers to protect those workers. As the largest proportion of funding to ALEOs comes from local authorities it is imperative local government is given the financial support it needs going forward. 

“The fact the £155m of Barnett consequentials promised by the Government have still not reached them is an outrage and more will be required on top of that to sustain service provision and our members jobs. The Scottish Government need to address this as a matter of urgency.”

GMB Scotland organiser Rhea Wolfson added that ALEOS will become “increasingly vulnerable to privatisation” should councils be unable to fund them.

She said: “There is a real fear ALEOs will be increasingly vulnerable to privatisation, pushing the workers and their services further away from the full public ownership model they should be under in the first place and, of course, that opens the door to further cuts to livelihoods. 

“But if we have learned anything from the last decade and this crisis, then government and councils should recognise we need to move away from austerity and towards investment if we want to recover.” 

READ MORE: ‘Unprecedented blow’ to Scottish economy from coronavirus crisis

“With that in mind, we take a more hopeful and forceful view that this crisis provides us with an opportunity to right the wrongs of the last generation, to consolidate our vital local services, bring back staff back on permanent contracts, value them properly and end the scandal of precarious working practices in our public sector.” 

“Scotland can’t call itself the land of fair work if it fails to do this.”

The Government said the £155m was to be given to councils this month, with the first instalment being paid last week. It also said it was “front-loading” weekly payment grants by £300m to help council cash flow.