It’s time for a real change to council funding

GLASGOW City Council is facing an eye- watering

£ 119 million spending gap in order to set a legal budget in February.

As others have said, it’s way beyond anything we’ve had to contend with before and councillors are having to consider savings options from officers which we would not wish for.

It is important to understand why the gap is so large.

The initial forecast – and these forecasts do change – assumes we will get the same level of Scottish Government grant. However, there are three really significant areas where we will have to spend more in the year ahead.

First, and most obviously, the council is feeling the effects of inflation, particularly on energy bills, just like other businesses and indeed households right now.

Secondly, we need to start repaying the money used to settle historic equal pay claims, on which a deal has been reached this week.

I’m delighted that payouts have now been agreed with the women who were discriminated against for so long.

But it is a fact that if Glasgow had settled at the same time as other neighbouring councils who made similar mistakes then this would be at a fraction of the cost.

The Labour councillors who resisted settling for so long should apologise to the whole city for the cost they will now have to bear.

By far the most significant additional costs we face will be for cost- of- living pay deals for our staff.

We must find funds both for the current year’s deal, as well as a minimum 5% starting contribution to any deal for next year.

Putting aside as much money as we can to improve pay for our workforce, many of whom are still seriously low paid, in a cost- of- living crisis, is absolutely the right thing to do.

But this exposes the unacceptable truth that in order to increase wages, we either have to rely on increased funding from the Scottish Government or we have to make cuts to services. That has to change.

In most European countries, local municipalities can raise around half of their funding needs through a range of local taxes, levies and charges.

In Scotland, councils only really have direct control of around 15% and the mechanism we have for that is the unfair and outdated council tax.

The UK Government will publish its Autumn Statement next week. If, as many predict, it brings a new wave of austerity, with cuts to Scotland’s block grant, we will need options on the table to enable different choices, in order to protect people, pay and public services.

The Scottish Government rightly wants more fiscal powers, including greater ability to borrow, and it is deeply disappointing that Labour and Conservative MSPs have refused to back those calls.

But equally, the Scottish Government can do much more to empower councils to avoid a crisis in local services.

That should include bringing forward emergency legislation, if needed, to change the funding rules for councils and to give us a greater range of revenueraising options.

Real reform of local funding cannot be put off any longer, the time to step up is now.