Warning of job losses as SNP cuts off rates relief

‘Unable to replace facilities’

JOBS could be cut in council sport and culture departments following the SNP’s decision to end business rates relief for arm’s-length bodies, according to spending watchdogs.

The Accounts Commission yesterday revealed that concerns have been raised over financial constraints impacting on the funding of arm’s-length external organisations (ALEOs) – and how this could impact on services in the future.

Last year the Scottish Government rejected a recommendation to end charity relief from non-domestic rates for ALEOs.

But Finance Secretary Derek Mackay said he intended to offset any further charity relief benefit to councils ‘to deter future ALEO expansion’.

The report for the Accounts Commission for Scotland said taxation advantages for registered charities had been a ‘strong driver’ for councils establishing ALEOs as it allowed them to save money without making cuts to services.

Scottish Labour finance spokesman James Kelly said: ‘This would leave many councils and their trusts unable to replace older facilities.’

A Scottish Government spokesman said: ‘The creation of ALEOs is a way in which local authorities can avoid paying tax. In 2017/18 we estimate this deprived the public purse of around £45million.’