Hansard

The budget that the Scottish Government has delivered includes money for diversionary measures in our communities, enhanced community safety, a more efficient service that is moving towards the single police and fire service, and more than 1,000 more police officers on our streets. That compares very well with what is happening in England, for example, where there has been a reduction—not a growth—of 16,000 in the number of police officers on the streets. The Scottish National Party’s record on community safety and the police service is first class.

I am delighted to be able to inform members that all 32 local authority leaders have confirmed that their 2012-13 budgets contain the full provision to enable each of the commitments to be fulfilled. As a result of that confirmation, the order seeks approval for each local authority’s share of the £70 million that has been set aside to compensate councils for the council tax income that they have foregone as a result of their decision to freeze the council tax.

The decision to freeze the council tax and maintain police and teacher numbers will benefit every household in Scotland. There are many other examples of how local authority budget decisions will impact on various groups of people, including the allocation of money for tackling youth unemployment and poverty, as well as providing a living wage for local authority staff, and improving infrastructure in local areas. Councils are clearly focusing on contributing to economic recovery. Those steps are very welcome and will help to deliver better outcomes for people who are living and working in our communities across Scotland.

The Government’s commitment to continuing to support families in what is still a challenging financial environment is demonstrated by our on-going support for the council tax freeze. That support is vital, because it will ease the financial pressures that are being faced by households and communities, and it will stimulate our local economies, because household spending has the potential to provide a cost-effective stimulus as we work towards economic recovery. We have, of course, committed to working with local authorities to extend the council tax freeze over the lifetime of this parliamentary session. The agreement of all local authorities to extend the council tax freeze for 2012-13 means that our commitment will have saved households the length and breadth of Scotland more than £1 billion.

In England between 2008 and 2011, council tax increased by almost 9 per cent, whereas in Scotland it remained unchanged. In addition, an annual study by the Chartered Institute of Public Finance and Accountancy found that 43 per cent of homeowners in England will see a rise in their council tax bill next year. People in England appear to be having the worst of all worlds with deeper cuts in their council budgets and 45 per cent of all households facing higher council tax bills and other bills as a result of the United Kingdom Government’s policies. The average council tax bill for a band D property in England in 2011-12 was £1,439, which is more than £290 higher than it is in Scotland.

Since the main order was approved in February, there has been one further change in relation to the distribution of the £37.6 million for the teachers induction scheme. That funding has traditionally been held back until the number of probationary teachers who are allocated to each local authority is known, when it is distributed accordingly. Following a request from the Convention of Scottish Local Authorities, it has been agreed to distribute £10 million of that funding up front, and I confirm that that sum is included in the amendment order for approval. The remaining £27.6 million will be allocated later in the year.

I confirm that all 32 local authorities have now agreed to the 2013 targets of the business rates incentivisation scheme. That means that all local authorities will have the opportunity to directly benefit from maximising their existing business rate income and from growing their business tax base. Under the scheme, any council that exceeds its target will be able to retain half of the additional amount collected over and above the target figure. Equally, any council that does not reach its target will still be compensated by the Scottish Government up to the amount that is set out in the amendment order. The introduction of the business rates incentivisation scheme means, therefore, a winning, no-lose situation for councils and a potential gain for the Scottish Government and all the people of Scotland as a result of incentivising increased economic growth.

In summary, approval of the amendment order will authorise the distribution of a further £80 million to local government, to support the essential services that local authorities deliver to our communities. If all the councils had not accepted the offer, that would have undermined the constructive relationship that we have developed with our local authorities. However, they have accepted it and they have constructed their budgets in a way that contributes to the Government’s priorities, such as the preventative spend agenda.

To vote against the amendment order would be to go against the wishes of each and every local authority in Scotland and to deprive communities of £80 million of essential services, such as education, social work, police and fire services.

During questions on finance, employment and sustainable growth earlier today, James Kelly suggested that the cuts to local government were disproportionate, but they are not. I have researched the figure of 88 per cent cuts to local government. It is only possible to arrive at such a figure if £2.5 billion of Scottish Government contribution is excluded from local government spend. If James Kelly wants to ignore the £2.5 billion that is going towards local government, the figure of 88 per cent would be absolutely correct, but the £2.5 billion contribution exists in reality. It is part of a fair and decent settlement for local government. He need not take my word for it, because the president of COSLA has said that our financial deal for local government is the best possible deal under the circumstances.

On that note, I am happy to move,

That the Parliament agrees that the Local Government Finance (Scotland) Amendment Order 2012 [draft] be approved.

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