Council finance chiefs warn of cuts to services amid £1bn budget pressures

Council finance chiefs in Scotland have warned vital services could be reduced or stopped due to budget pressures of £1 billion.

Finance directors from all 32 Scottish local authorities have written an “unprecedented” letter to interim Finance Secretary John Swinney to highlight “immediate concerns” over the sustainability of councils.

The alarm comes in advance of the Scottish budget which will be set out by Mr Swinney on December 15.

Mr Swinney has been warned that councils face “peril” if financial challenges continue, with “tough choices” having to be made on schools, waste and health and social care if councils are not adequately supported.

Local authority staff accepted a pay increase offer earlier this year – ending disputes – but at the expense of council budgets.

Council finance bosses have urged Mr Swinney to reduce the “bureaucracy over small pots of monies” and pass over new funding to local government “with full autonomy over how the funds are best used locally”.

The letter to Mr Swinney said: “The situation for next year and beyond is unprecedented.

“Local government is facing over £1bn of pressures in 2023/24 with councils now facing tough choices that will impact the services they rely upon.”

“The choices come down to reducing services, stopping services or ultimately, reducing the number of jobs. This is bad news for individuals, families, communities and economies across Scotland,” it added.

The finance chiefs went on to warn there was no “path to delivering balanced budgets”.

The letter said: “Almost all councils are having to think carefully about how to scale back their capital programme within budget, with such considerations coming at a time when supporting economic growth post-Covid is more important that ever.”

It went on to warn of “serious issues” which could see “less money for school food, classroom support, family support, youth work, economic development, libraries and other key services that are critical to supporting the most vulnerable.”

Daniel Johnson, Scottish Labour’s finance spokesman, said: “This damning letter lays bare the damage the SNP have inflicted on local services.

“The SNP have been a conveyor belt of austerity for years, raiding local budgets to pay for their vanity projects – and now there is nothing left to cut.

“Local councils are at breaking point, and it is not just because of the current economic crisis – it is down to years of neglect and billions of pounds worth of cuts by this Government.”

Public Finance minister Tom Arthur said: “We understand the concerns of local authorities about the financial pressures facing the whole public sector, the UK Government’s fiscal statement in November did little to reflect those challenges.

“We are doing everything within our power to support people, public services and the economy during the cost-of-living crisis.

“The Scottish Government is treating councils fairly and providing a real terms increase of 6.3% to local authority budgets this year.

“Scotland’s settlements from the UK Government have suffered a decade of austerity, with average real terms cuts of over 5% equating to a loss of £18 billion.

“Despite this, local authority revenue funding is £2.2 billion or 22.9% higher in cash terms in 2022-23 than it was in 2013-14.

“Future spending decisions will be outlined as part of the 2023-24 Scottish Budget on December 15 and we will liaise closely with local government throughout the budgetary process.”