Scotland council leaders seek reassurances over £3.4 billion in funds announced in Budget

Council leaders have written to both the Scottish and UK governments seeking assurances that local government will receive its “fair share” of the additional funds announced in the UK Budget.

Rachel Reeves delivered the first Labour Budget in 14 years on Wednesday, in which she promised Scotland would receive an additional £3.4 billion in Barnett consequentials. 

Deputy First Minister and Finance Secretary Shona Robison arrives for First Minister's Questions at the Scottish Parliament. Picture: Jeff J Mitchell/Getty Images | Getty Images

The sum represents the largest real-terms funding settlement since devolution, and comes with an additional £1.5bn in this financial year.

Now Councillor Katie Hagmann, the resources spokeswoman for council umbrella body Cosla, has written to both administrations warning local government has faced “significant cuts”, and called for support to protect public services.

She said: “Scottish local government has seen significant cuts to our core settlement over time, and we hope that moving into 2025/26 we can begin to reverse these cuts and ensure that there is sustainable investment in local public services.

“We have sought assurances from the UK government around some areas, including the increase to employer National Insurance contributions, which will not only have a detrimental impact on councils as employers, but also on the many partner organisations who deliver vital services across our communities, for example social care and children's services. We will continue to work with both the UK government and Scottish Government to minimise any detriment to our communities and their local services.

“The Verity House Agreement between Scottish local government and the Scottish Government laid out shared priorities around tackling child poverty, supporting a just transition to net zero and sustainable public services. We hope to work constructively with colleagues in Scottish Government to deliver on these and ensure the very best outcomes for everyone in our communities.” 

Last month Scotland's spending watchdog warned of "significant resistance" from the public to deep cuts by local councils was putting "the sustainability of vital public services at risk".

The Accounts Commission claimed that a backlash from local communities to councils following through with unpalatable cuts to services was undermining the desperate need for local authorities to transform how they manage their finances.

Scottish Labour economy spokesman Daniel Johnson said the UK government was “investing another £1.4bn directly in Scotland’s future”.

“This will help to renew infrastructure and promote growth the length and breadth of Scotland,” he said. “Labour’s direct investment in these projects will strengthen local communities and economies – but we need a government with ambition in Holyrood too.”

A Scottish Government spokesperson said: “We are assessing the full implications of the Chancellor’s Autumn Budget statement. Finance Secretary Shona Robison will be announcing further details as part of the Scottish Budget on December 4.

“We recognise the crucial role councils play in their communities. That is why we are making available record funding of more than £14bn to councils in 2024/25 and our commitment to meaningful budget engagement with Cosla will continue ahead of the Scottish Budget.”

A UK government spokesperson said: “Funding for local government is a responsibility devolved to the Scottish Government and the Autumn Budget provided it with a record £47.7bn settlement – the largest in real terms in the history of devolution.

“Given the impacts of changes to Employer National Insurance Contributions are complex, this settlement does not reflect this additional support the Chancellor is providing for the public sector. We are working through the Budget implications with the Scottish Government.”