Councils face £500m funding black hole

SCOTLAND’S councils face a £500million funding shortfall which will see services cut, taxes raised and cash reserves raided.

The Accounts Commission revealed the huge black hole facing local authorities in the year to April 2020, and found that twothirds of the shortfall will be met through service cuts, one-fifth from council tax rises and the rest from spending reserves.

Its report also shows that since 2013-14, councils have suffered a funding drop of 7.6 per cent in real terms – much higher than the decline in other services.

Over the past three years, 23 of Scotland’s 32 local authorities have drawn from their ‘rainy day fund’, cutting their reserves by £45million by the end of last year.

Scottish Conservative local government spokesman Alexander Stewart said: ‘Before long these reserves, built up over decades, will be gone.

‘That’s what happens when you have an SNP government which has cut local authority funding to the bone. The Nationalists need to start getting their priorities right. They’ve been in charge of local government for more than 12 years and are entirely responsible for this terrible state of affairs.’

The report said Scottish Government funding dropped by 0.7 per cent in 2018-19, leaving a gap of £400million. Despite a slight increase in 2019-20, that shortfall is estimated to have grown to £500million.

Gail Macgregor, spokesman for local authority body Cosla, said councils had ‘borne the brunt’ of Government cuts.

A Scottish Government spokesman said: ‘Despite cuts to the Scottish budget, we have ensured our partners in local government receive a fair funding settlement.

‘Contrary to the Accounts Commission’s claim, Scottish Government revenue funding in 2018-19 increased by 0.3 per cent in real terms compared with 2017-18.’