Concerns have been raised over the future of Shetland after a watchdog said it was “not confident” the council could prove it was financially sustainable.
Public spending watchdog the Accounts Commission raised concerns about the local authority “delivering on its duty to provide best value for local people”.
Other issued raised included an ongoing reliance on using reserves to balance its budget, a lack of urgency in putting plans in place to transform how services are provided, and slow progress in making vital improvements to performance.
However, it did praise the council’s relationship with local partners, including its response to the challenges of Covid-19.
The watchdog warned that improvement must be made on the management of resources which show “urgent change”.
William Moyes, Chair of the Accounts Commission said: “Councillors must provide the strong leadership needed and have greater involvement in developing robust and viable plans to address the significant issues in our report.
“Clear links must be made between plans to save money and plans to change how services are delivered.
“The council needs to make much faster progress with its Change Programme and ensure it is resourced effectively.
“The Accounts Commission remains deeply concerned about the council’s capacity and ability to make the changes needed.
“A further report will be needed within 18 months.”