Page last updated at 11:22 GMT, Thursday, 18 March 2010

Online council ads plan scrapped

The announcement has been hailed as a victory for the newspaper industry

The Scottish government has scrapped controversial plans to allow local councils to put their adverts online rather than in newspapers.

The government had hoped the move would save local authorities millions of pounds every year.

But the proposal has been abandoned following opposition from the newspaper industry.

Publishers had claimed the potential loss of advertising revenues would have a devastating effect on many titles.

Councils are currently obliged to put statutory notices, such as road closures and applications for planning permission, in newspapers.

As a minority government it is incumbent on us to build consensus and in this case that has not been possible
John Swinney
Finance secretary

The adverts, which cost councils a total of about £6m every year, are a vital source of income for many local newspapers - although national titles such as the Herald, Scotsman and Press and Journal also faced having their advertising revenue cut.

Opponents of the proposals had also claimed it would be bad for democracy to have statutory notices only placed online, as many people still do not have access to the internet in their homes.

Following the eight-week consultation period, Finance Secretary John Swinney confirmed the proposal, which would have allowed the councils to advertise through an online portal, would not now be advanced as it had insufficient support to get through parliament.

Mr Swinney said: "The UK government is imposing the first cut in Scotland's budget since devolution next year and further reductions in spending are inevitable in years to come.

"Facing that increasingly challenging financial environment, Scotland's councils identified a need to cut spending on public notices, which currently cost around £6m a year.

"The purpose of this legislation, which government began work on in 2006, was to give councils the option of using a more effective way of improving communication with the public and deliver increased value for money.

"As a minority government it is incumbent on us to build consensus and in this case that has not been possible. Given the strength of views expressed, we have decided not to proceed with the legislation."

'Victory for democracy'

Mr Swinney said those who called on the government to withdraw the legislation had "singularly failed" to say how they would cut spending on adverts, and challenged them to put forward positive suggestions for how cash-strapped councils could save money without cutting front line services.

And he said the Scottish government would continue to develop the online advertising portal for the public sector.

Scottish Labour leader Iain Gray said the withdrawal of the legislation was a "victory for local newspapers".

He added: "This decision is a victory for democracy and a humiliating climbdown for the SNP. John Swinney's proposals to allow local councils to put public notices online instead of in newspapers were undemocratic and I am glad that they have now been dropped.

This decision is like a council deciding to teach our children with slates and chalk when the rest of the world has moved on to new technology
Pat Watters
COSLA President

"Large numbers of people in Scotland don't have access to the internet and there is a real danger that putting public notices online would have led to important decisions being taken without proper scrutiny."

'Under pressure'

Cosla president Councillor Pat Watters said: "The government have been forced to abandon a change to legislation due to some elements of the press, purely through protectionism and self interest, creating a spurious impression that those without access to a computer would be in some way disadvantaged - this is simply untrue.

"As a result of this decision councils will be forced to place advertisements that nobody reads in newspapers with plummeting readerships at a cost of £6m a year at a time when public sector budgets have never been under such pressure.

"This decision is like a council deciding to teach our children with slates and chalk when the rest of the world has moved on to new technology.

"I have no objection if the government whether in Westminster or Holyrood wants to subsidise the newspaper industry to the tune of £6m a year but this subsidy should come directly from their funds not from ours."

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