Funding and governance of Scottish services

The Scottish local governance system is very different to that of the Nordic countries. Put bluntly, Scotland (like the rest of the UK) has one of the most centralised public administrations and one of the weakest local democratic frameworks in Europe. In Scotland just 32 Councils represent 5.2 million residents. At a more local level there are more than 100 Community Councils – elected representative bodies for communities whose purpose is to develop community concensus about local issues and transmit it upwards to the Unitary Authority. In reality, these institutions have little power and only a small portion of Scottish communities (<10%) have representation. Some Scottish services, including the welfare system, are currently administered by the UK government. Others, are run by agencies of the Scottish Government. Health Services are overseen by a separate branch of the National Health Service (NHS Scotland), with day to day management by 14 regional Health Boards (some overlap with the 32 Councils).

The pattern of responsibility for economic development is highly complex, involving two regional agencies (Scottish Enterprise and Highlands and Islands Enterprise), modest involvement of the Councils, plus a large number of national, regional and local institutions from public, private and third sectors. The Councils are responsible for providing education, waste collection and recycling, planning and building standards, social services, sport and recreation facilities, local road maintenance grass cutting and snow clearing, maintenance of public spaces. In recognition of the complex and fragmented way in which services are delivered in Scotland the Scottish Government passed an Act in 2003 to set up Community Planning Partnerships. These partnerships bring together most of the public agencies responsible for delivering services in each of the 32 Council Areas. Each of these has produced a Single Outcome Agreement describing their strategy.

In Scotland only 20% of Council expenditure is raised locally through a property tax. The other 80% comes from Scotland’s allocation of the national (UK) income tax, which is divided between the 32 councils on the basis of a complex calculation involving a range of indicators of the need for the different services for which they are responsible. Thus the resources available to Scotland’s Councils are largely out of their control.

Key issues in remote and sparsely populated areas

As in most European countries the Scottish governance system and service delivery arrangements have been affected both by longer-term paradigm shifts (New Public Management and Neo-liberal approaches) and, more recently, by austerity. This has resulted in a highly complex network of public, private and third sector service provision. Rationalisation has in many cases left more remote and sparsely populated areas without easy access to services. Faced with the resulting negative impact to well-being, the inhabitants of many such areas have looked to their own resources, and created a multiplicity of innovative community solutions which in many cases could be considered social innovations. The Scottish Government seem very supportive of such localism. They continue to fund research into community development, and to provide various forms of support for community initiatives of varying degrees of complexity from simple schemes to address a specific issue, to the more holistic and integrated strategies of the Development Trusts. Such trusts are specific legal entities, comprising local individuals and agencies, and purposely designed to carry out territorial social innovation.

Social innovation in Scotland

 SI is not a new phenomenon in the Scottish context – as in other countries it is rooted in traditions of philanthropy, cooperation and charitable activities; it is the terminology and the increasing recognition of its role in development which drive the current high level of interest. The current Scottish Government is very favourable towards SI. It has, for example, commissioned research on how EU Structural Funds can be used to support it, and another project to explore how its potential is perceived by ordinary people, and groups within the third sector. It also supports a substantial population of representative and advisory bodies which provide various services to the third sector.

There is considerably less scope for genuine public sector-led SI at the municipal level in Scotland as compared with the Nordic countries. This is largely due to the extreme centralisation of decision making and public administration (described above) which renders the 32 Councils little more than delivery agencies for national policies. The third sector, however, is a rich source of SI activitity and often operates in close cooperation with the public sector, at either central or local level. Many SI initiatives which deliver a range of services to different segments of the population (the elderly, young unemployed, the homeless and destitute, handicaped or with mental health issues etc) survive on the basis of a combination of volunteering and grants from their local council, the Scottish Government, or a range of other public sector bodies. Thus the role of the public sector is mostly quite indirect and facilitative, as opposed to initiation or leadership.

Social innovation in local development

Maintaining acceptable levels of wellbeing for the residents of remote and sparsely populated areas in the face of policies favouring rationalisation and austerity has presented a particular challenge. SI has clearly been part of the solution. Local transport, support for elderly, people with disablities, disadvantaged groups, childcare, housing, retailing, provision of food for the poorest people, even local economic development strategies, are all commonly tackled by locally-run third sector groups. Some of the most striking examples of SI in local development in recent years have been community development initiatives, sometimes associated with the purchase of land and other assets under Land Reform legistation, by the local resident population. A well known example of this is the Eigg Herritage Trust, which owns all the land and assets of the Island of Eigg, runs many local services, and facilitates economic and social development in a variety of ways. Even where land reform has not taken place many local communities in rural areas have set up development trusts with the aim of making their communities more socially sustainable. It is important to be clear that most of the people involved in the many local community initiatives which surely qualify in terms of this project’s definition would not use, or even be familiar with the term Social Innovation.

Download the full National Contexts report including a complete listing of sources cited

Page last updated September 2016