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Meeting of the Parliament 16 March 2011

16 Mar 2011 · S3 · Meeting of the Parliament

Item of business

Local Government Finance (Scotland) Amendment (No 2) Order 2011

Swinney, John SNP North Tayside Watch on SPTV

On 10 February, Parliament approved the Local Government Finance (Scotland) Order 2011, which enabled Scotland’s local authorities to set next year’s revenue budgets. As part of that, local authorities were asked to provide by 28 February formal assurances that their approved 2011-12 budgets included provision to deliver on all the specified commitments in the 2010 spending review agreement, including freezing council tax levels for a fourth consecutive year; maintaining record levels of front-line police officers to help to keep our communities safe; maintaining the commitment to implement the early years framework and curriculum for excellence, to help to ensure that our children receive the best possible education; maintaining pupil teacher ratios in primary 1 to 3; and delivering a new change fund to help to alleviate pressure on the health and social care system and to identify and deliver new ways of working to improve outcomes in those fields.

On 1 March, I was delighted to welcome the news that all 32 local authorities in Scotland had formally accepted the funding package that the Government had offered. Their decision had been taken on the clear understanding that the funding that was held back from the original order would be forthcoming. As a result, the motions seek Parliament’s agreement to deliver an extra £426.3 million revenue funding to support the vital services that our communities expect and deserve, and to help to deliver our jointly agreed set of commitments.

On a more technical point, this year’s local government finance order is subject to two amendment orders. This is because—as I announced on 9 February in the stage 3 debate on the Budget (Scotland) (No 5) Bill—I have also updated the forecasts for the total estimated distributable non-domestic rates income for 2011-12 to take account of lower than expected losses from revaluation appeals and a considered assessment of growth. As a result, the distributable amount of non-domestic rates income for 2011-12 has been increased by £11.5 million, and to maintain the total local government funding I have consequently offset the revenue support grant total by the same amount. Those two offsetting changes have no impact on the total revenue funding that will be available to local authorities next year.

Failure to approve both amendment orders today could have potentially serious consequences for all local authorities across Scotland and on the vital services that they will provide to our communities. It would, for example, result in a further significant reduction in funding on top of the £432.9 million that has already been taken out of local authority budgets in the face of the wider public spending reductions that had to be confronted in this year’s budget.

The provisions in the orders clearly support one of the Government’s central commitments, which is delivery of the council tax freeze. The freeze demonstrates the Government’s commitment to continuing to do all that it can to support families in what remains a challenging financial climate, and it will be welcomed by households as a means of helping to ease the financial pressures that they face as we work towards economic recovery.

Our agreement with local authorities to extend the council tax freeze means that, over the full four years of this Parliament, our commitment will have cumulatively saved households the length and breadth of Scotland £700 million. Such a substantial saving to all households in Scotland has helped—and will continue to help—to boost spending in local economies.

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Meeting of the Parliament 16 March 2011

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