This item was published during the term of a previous administration that ended in April 2007
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Increased funding for councils
08/02/2006
Scottish local authorities are set to receive an increase of almost four per cent in Executive funding in 2006-07.
Finance Minister Tom McCabe told the Parliament today that councils would receive £8.322 billion in revenue grant support for their core services and another £1.1 billion through specific revenue grants in 2006-07.
And there would also be an immediate additional one-off amount of over £140 million extra to meet spending pressures which have arisen since the allocations were confirmed this time last year.
On top of this, councils are expected to raise more than £2 billion locally through the council tax and take at least a further £5 billion in sales, fees and charges and other income. And councils would be able to invest around £1 billion next year in new infrastructure.
That adds up to around £17 billion for councils to spend on services next year.
Speaking as the Scottish Parliament debated the Local Government Finance (Scotland) Order 2006, Mr McCabe said:
"An increase of almost four per cent is reasonable by any standards and it will build on a five and a half per cent the previous year. In fact, there has been an increase of almost 50 per cent in grant to local government since 1999.
"The facts simply do not in any way support claims we are under-funding councils. These extra resources confirm our commitment to improve public services for people living and working in Scotland and bring the total provided to a new record high.
"There is no doubt these are substantial sums of money. But taxpayers want to know what their money delivers - I don't think they want to see the Executive and councils arguing about funding. People must wonder why there is such a heated debate when these massive sums of money are being allocated to local authorities.
"The people of Scotland want to see us getting on with what they pay us to do, which is delivering the kind of public services they expect and deserve. That is exactly what the Executive is committed to doing."
He added:
"Local authorities will confirm their council tax levels shortly. I share the concerns of council taxpayers across Scotland following all the recent speculation and scaremongering, particularly when rises as high as 16 per cent were suggested at one stage.
"The COSLA snapshot survey figures - which have been exaggerated in the past - suggest the average council tax increase will be around five per cent, with three councils proposing increases of 2.5 per cent and six between 2.5 per cent and four per cent. I recognise every council starts from a different position, but if some councils are expecting to come in at or below 2.5 per cent, this clearly demonstrates it can be done.
"When setting their final council tax levels, all local authorities should consider carefully the increases in grant I have announced, the scope for further efficiencies and the level of their reserves. Most of all, I urge them to exercise restraint - but it will, of course, be for councils and councils alone to justify their decisions to their electorate."
AGGREGATE EXTERNAL FINANCE INCREASES FOR 2006-07 AND 2007-08
COUNCIL | AEF 2006-07 £m | % increase | AEF 2007-08 £m | % increase |
Aberdeen City | 291.033 | 2.6% | 297.908 | 2.4% |
Aberdeenshire | 342.668 | 6.2% | 353.783 | 3.2% |
Angus | 173.361 | 5.2% | 178.975 | 3.2% |
Argyll & Bute | 175.107 | 6.0% | 179.354 | 2.4% |
Clackmannanshire | 74.085 | 3.8% | 76.708 | 3.5% |
Dumfries & Galloway | 251.025 | 4.5% | 257.847 | 2.7% |
Dundee City | 253.072 | 2.6% | 258.977 | 2.3% |
East Ayrshire | 193.039 | 4.7% | 198.195 | 2.7% |
East Dunbartonshire | 152.338 | 3.1% | 155.859 | 2.3% |
East Lothian | 134.791 | 5.8% | 139.369 | 3.4% |
East Renfrewshire | 137.384 | 6.7% | 141.506 | 3.0% |
Edinburgh, City of | 629.886 | 3.0% | 646.873 | 2.7% |
Eilean Siar | 96.738 | 2.6% | 98.870 | 2.2% |
Falkirk | 225.706 | 4.2% | 233.345 | 3.4% |
Fife | 536.744 | 3.8% | 555.133 | 3.4% |
Glasgow City | 1,137.561 | 2.6% | 1,164.812 | 2.4% |
Highland | 390.058 | 4.8% | 403.102 | 3.3% |
Inverclyde | 145.889 | 4.0% | 149.753 | 2.6% |
Midlothian | 127.536 | 3.3% | 131.433 | 3.1% |
Moray | 137.875 | 4.2% | 142.459 | 3.3% |
North Ayrshire | 222.300 | 4.2% | 228.837 | 2.9% |
North Lanarkshire | 513.147 | 4.5% | 529.295 | 3.1% |
Orkney | 58.510 | 6.8% | 59.538 | 1.8% |
Perth & Kinross | 206.198 | 5.4% | 213.225 | 3.4% |
Renfrewshire | 272.644 | 3.0% | 280.608 | 2.9% |
Scottish Borders | 181.825 | 5.0% | 187.990 | 3.4% |
Shetland | 79.562 | 2.7% | 81.355 | 2.3% |
South Ayrshire | 168.429 | 3.9% | 173.269 | 2.9% |
South Lanarkshire | 466.130 | 3.4% | 479.346 | 2.8% |
Stirling | 138.696 | 2.7% | 143.282 | 3.3% |
West Dunbartonshire | 163.864 | 2.7% | 167.768 | 2.4% |
West Lothian | 244.915 | 4.9% | 252.234 | 3.0% |
Scotland | 8,322.115 | 3.9% | 8,561.009 | 2.9% |
NOTE: The year-on-year increases in Aggregate External Finance have been adjusted to reflect the transfer of responsibility for Concessionary Fares, with effect 1 April 2006.
The Local Government Finance (Scotland) Order 2006 provides the statutory authority for the payment of Revenue Support Grant (RSG) to local authorities in 2006-07 and confirms changes since the last Order to the amounts payable to each authority for the current and previous financial year.
The increase in core revenue funding for 2006-07 of 3.9 per cent takes into account an adjustment of around £80 million to reflect the transfer of responsibility from local to central government for the national concessionary travel scheme from 1 April 2006. The adjustment is necessary in order to compare figures on a like for like basis.