Dundee City Council is “well-placed” to tackle future challenges, a senior officer has reported.
Marjory Stewart, director of corporate services, made the claim in the council’s annual accounts for 2012-13, a year that saw continuing budget cuts and scores of staff taking redundancy or early retirement.
Ms Stewart said: “The national landscape continues to be one of no or low levels of economic growth, but with continuing price inflation, particularly in areas such as fuel and energy costs.
“The Westminster Government’s austerity measures have resulted in grant funding levels that are flat in cash terms, but which actually represent reductions in real terms when pay and price inflation are factored in.
“Local demographic factors have also increased pressure on demand-led services in key areas such as education and social work.
“The council has therefore had to identify significant levels of savings and efficiencies in order to achieve a balanced budget, within the constraints of a continuing council tax freeze.
“This trend is likely to continue over the short to medium term as the economy slowly returns to normal levels of growth.”
The council expects to make savings totalling £22 million between 2013 and 2016, with £6.5 million of that coming in the current financial year.
Ms Stewart said a redesign of council services had helped cut costs, while a voluntary early retirement and redundancy scheme has taken £11.2 million a year off the bill for staff.
The accounts show that during 2012-13 a total of 143 employees received exit packages upon retirement or redundancy.
The total cost came to £5.2 million, or an average of £36,000 per person.
Nine of the staff who left received between £100,000 and £150,000 and another three received in excess of £150,000 the total sum for these 12 coming to £1.6 million.
There were 138 staff paid more than £50,000 during the year, up three compared to the previous year.
Chief executive David Dorward had the highest salary, £136,000.
Four other people earned a little over £100,000 Ms Stewart, education director Michael Wood, city development director Mike Galloway and social work director Alan Baird who has now been seconded to the Scottish Government.
The accounts show that education was by far the biggest item of net spending, some £146 million, followed by social work on £101 million. Total spending came to £456 million.
Salaries, allowance and expenses for councillors totalled £607,000.
Most of the council’s income came from central government, with the council tax raising only £58 million.
2012-13 was the fifth year of a 30-year private finance initiative contract with Discovery Education to construct, maintain and manage six primary schools and two secondary schools.
Payment for the current financial year will be £10.6 million, of which £4.9 million is interest.
The total to be paid over the 30 years is £364 million, of which £147 million will be interest.
Accountants KPMG have audited the accounts. They said the city council had the lowest financial reserves compared to its spending of any of the 32 Scottish local authorities.
In a report to be considered by councillors on the scrutiny committee this week, KPMG warned this was a “continuing challenge for financial management” during difficult economic conditions.