THE long-standing deal between the SNP Government and councils was under threat last night after it emerged that Aberdeen City Council is considering withdrawing from the arrangement underpinning local government funding.
Scotland on Sunday has learned that Aberdeen’s civic leaders are looking at breaking away from the Convention of Scottish Local Authorities (Cosla), the umbrella body which has worked with the government to deliver the council tax freeze.
Should Aberdeen remove itself from Cosla, the council’s departure would signal the end of the SNP Government’s much heralded “historic concordat” with councils, which has been behind the council tax freeze.
Councillors in the Labour-run local authority have been growing increasingly frustrated with John Swinney’s failure to meet their demands for a change in the complex funding formula that determines Aberdeen’s £170 million a year settlement from the Scottish Government.
Labour councillors believe that Aberdeen does not get a fair deal from the formula, because it generates more in Business Rates than it receives in its grant. Aberdeen has historically been saddled with a very low grant compared with other authorities, due to the complex funding formula designed in part to help more deprived areas.
According to councillor Willie Young, Labour’s convener of finance resources in Aberdeen, council leaders recently voted to change the formula to a flat cash settlement at a Cosla meeting two weeks ago. A flat cash settlement would reduce the amount of variation across councils when it comes to the cash allocated to local government.
Despite a majority of council leaders wanting to change the formula, Swinney, the finance secretary, is refusing to meet their demand.
“This is a power struggle,” said Young. “What’s happened here is the leaders have come to an agreement of how we move forward and now John Swinney is going back on that. We are desperately unhappy. In the past the finance secretary has said that we can’t change the funding formula, because Cosla are in charge. So Cosla has made a decision and now John Swinney is saying ‘well, I don’t like that decision so I’m just going to go on. That’s unacceptable. And I don’t think Aberdeen City Council are the only to think this way. What is the point of making a decision if the finance secretary is just going to ignore it? We will certainly look at pulling out of Cosla. Is Cosla in charge? Or is the minister able to do what he wants when he wants?”
Young added that he thought other big councils such as Glasgow, Edinburgh and North Lanarkshire also had to look at their relationship with Cosla. The issue is bound to be raised at the next meeting of council leaders on 22 November.
“Cosla becomes unworkable if some of these large local authorities decide to break-away. We would absolutely consider it because things are not working the way they are supposed to work.
“The finance secretary is ignoring a democratic decision of Cosla,” Young added.
A breakaway would represent the first time that a crack has a appeared in Cosla since the SNP came to power in 2007. The concordat has been a key and much-trumpeted part of SNP policy.