Cuts a 'dagger though heart of Glasgow'

THE SNP Government was on a collision course with Scotland's biggest council last night after the authority's leader accused finance secretary John Swinney of driving a "dagger through the heart of Glasgow" with a multi-million pound cuts package.

Mr Swinney announced a funding deal of more than 11.5 billion in 2011-12 for local councils, which he claimed would mean a 2.6 per cent cut if the authorities accepted a deal to freeze council tax and increase police numbers.

However, the finance secretary, who said councils which refused the deal would face cuts of 6.4 per cent, was accused of forcing Glasgow City Council to make "brutal and unpalatable" decisions by handing the authority a cut of nearly 3.6 per cent - well above the Scottish average of 2.6 per cent.

Glasgow city council leader Gordon Matheson said: "It is absolutely clear that the SNP Government cares nothing for Glasgow, the beating heart of Scotland's economy. This announcement is a dagger through the heart of the city.

"John Swinney offered a deal to local government based on a cut of 2.6 per cent. Today he has cut Glasgow's budget by 3.6 per cent, an increase of 13.5million.

"We had a draft budget based on a 2.6 per cent cut which was difficult enough, but we are now going to have to go back to the drawing board and add the SNP's extra cuts.

"Be in no doubt they have forced us into the situation where we will have to make brutal and unpalatable decisions thanks to the contempt with which the SNP hold the people of Glasgow."

Mr Matheson went on to claim that Glasgow would be 46m better off if it had received the 0.32 per cent cut handed to West Lothian Council - the best local government settlement in Scotland.

However, a spokesman for Mr Swinney said that the funding deals were based on population. The spokesman said: "Gordon Matheson is talking absolute nonsense - Labour's policy is to hit people with a massive council tax hike.

"Through a review last year of the existing needs-based mechanism used to distribute council funding, Cosla (the local authority umbrella body) invited all 32 local authorities to identify anomalies.

"The review, which involved representatives of a cross-section of Scotland's councils, recommended that the existing indicators were reasonable and should be retained.Glasgow city council has a falling population, and population is the key driver of the agreed distribution methodology."

Meanwhile, funding packages for councils announced in the Scottish parliament yesterday saw Dundee and Aberdeen among the winners, after the two authorities were told their funding would be cut by 1.03 per cent and 1.59 per cent respectively.

Edinburgh council was among the losers in the provisional funding announcement with a cutback of 3.11 per cent, while the authority with the worst deal in Scotland was Argyll and Bute with a 4.94 per cent cut.

Edinburgh council leader Jenny Dawe, said that the deal announced by Mr Swinney "looks disappointing".

Meanwhile, business leaders accused the SNP government of an "utter betrayal after the finance secretary set out plans to impose a retail levy on firms with properties worth more than 750,000 as part of the funding settlement for councils.

Mr Swinney said that firms with a rateable value above 750,000 would pay a "different level of large business supplement" in a move he claimed would raise 30m.

The finance secretary had previously announced the controversial 30m supermarket tax, but yesterday Mr Swinney revealed that 225 business properties would be affected by the new rate and that overall 30 companies would pay more.

Iain McMillan, the director of CBI Scotland said: "We regard this as an utter betrayal of the Scottish Government's commitment to a uniform rate for business."