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Local government funding
11/02/2009
Councils will share £11.8 billion from the Scottish Government during 2009-10 to deliver public services.
Finance Secretary John Swinney confirmed the funding package to Parliament this afternoon, saying the increased funding for local authorities will help councils and the Scottish Government work together to continue to deliver first class services, freeze Council Tax and help Scotland weather the economic downturn.
The package includes additional resources of £70 million for local authorities that decide to freeze the Council Tax for a second year and in his statement the Cabinet Secretary guaranteed to fund a freeze to the end of this parliamentary term.
In light of prospective cuts of £1 billion to the Scottish Government budget from Westminster between 2010 and 2012, and the absence of Parliamentary support, Mr Swinney also said that the Government would not introduce Local Income Tax legislation in this Parliamentary session.
Mr Swinney said:
"Across the public sector we are dealing both with a squeeze on public spending - reflected by the worst settlement for the Scottish Government since devolution - and the impact of the global downturn.
"But against that backdrop we have acted to protect the Scottish Government's funding for local government services - and the shared outcomes that those services will deliver.
"We know that all councils are facing pressures on funding - so in line with the Concordat we signed, this Government will continue to discuss with our local government partners how best to respond.
"All this is based on our view of local government as equal partners in delivering the improvements people across Scotland want to see.
"Local authorities are crucial partners in delivering services and in our response to the economic downturn. Not only are councils making their own innovative plans to help their local economies, they are also delivering £90 million in accelerated capital spending to help keep our economy moving in 2009-10.
"As part of the overall package, £70 million has been set aside to help local authorities freeze council tax levels again in 2009-10.
"Freezing council tax for a further year will provide an important boost for council tax payers across Scotland during these particularly difficult economic times. I am strongly encouraged that some councils have already taken that decision and I hope that more will follow that example in the days and weeks to come.
"This Government remains committed to replacing Council Tax with a fairer local tax based on ability to pay.
"In the face of swingeing budget cuts from Westminster it would not be possible to introduce a tax reduction of the scale we proposed. Therefore in light of Parliamentary arithmetic and the current financial climate, Cabinet has decided not to introduce legislation to introduce a local income tax in this Parliamentary session."
The additional sums confirmed today have been agreed and discussed with COSLA. They include:
- £40 million in response to the report by Lord Sutherland's review of free personal care
- £42 million to meet the commitments on police and fire and rescue service pensions
- £18 million to support local government with an increase above that which was forecast in employers' pension contributions for teachers
- £12.2 million as local government takes on some of the powers for local regeneration