Council tax Scotland: Shona Robison issues ultimatum as council leaders warn of 'dispute' over tax freeze

Finance secretary Shona Robison has set out the Scottish Government’s position on council tax plainly

Scotland’s finance secretary has issued an ultimatum over a planned council tax freeze, as local authority leaders said they were in a "fundamental position of dispute" with the Government over funding.

Shona Robison warned authorities would not get a share of the £147 million the Government has pledged to fund a council tax freeze equivalent to 5 per cent, if they increase council tax.

But in a letter first reported on by the BBC, Cosla – the umbrella body for councils – said it was concerned about the "extremely disappointing tone and content of the letters" from members of the Cabinet.

Finance secretary Shona Robison speaking during First Minster's Questions at the Scottish Parliament. Picture: PA

Stephen McCabe, the Labour leader of Inverclyde Council, said the Verity House Agreement, which which sets out shared priorities between councils and the Government, was at risk.

“I think it is absolutely dead in the water,” he said. “I’ve never known the relations between local government and the Scottish Government to be so low.”

Council leaders have requested an urgent meeting with Ms Robison in a bid to discuss the impasse. However, it is understood a meeting between Cosla and Ms Robison is unlikely to take place until next week.

Ms Robison said: “We have provided £147m to councils to fund a council tax freeze equivalent to 5 per cent, to help households when the cost-of-living crisis is still there, bills are high, and it is an area people can have certainty over that the bills are not going to rise.

“We’ve also provided £145m to maintain teacher numbers and, of course, we know to close the poverty-related attainment gap and to improve education, teachers are an important part of that. So, we believe these elements of funding are important.

“But, ultimately, it is for councils to decide, but they can’t then have the money for those purposes if they decide to do otherwise.”

Her comments come as councils around the country are poised to set budgets.

Unions on Wednesday staged a protest outside the headquarters of Glasgow City Council against planned budget cuts to services, which an official said were already “on their knees”.

The unions said Glasgow alone faces a further budget gap of £150m in the coming three years, which would impact council services, jobs and wages.

Ms Robison insisted the Budget settlement for councils was “fair” in the context of what she described as a “real-terms cut” in the Scottish Budget from the UK government.

“I think the whole of the public sector is challenged and we have to be fair to the whole of the public sector, which means a fair settlement for local government,” she said.

“And, within that, we have prioritised some of the areas that are really important and we want to work with local government to move those forward.”

She said political leaders in Cosla had said they wanted the money for the council tax freeze, “plus a number of other asks, which isn’t a very reasonable negotiating position”.

“We had been making progress, I thought, to date, but political leaders have passed a motion that makes that very challenging,” she said.

“We will continue to discuss with Cosla where there are areas of further compromise. But it has to be reasonable, it has to be fair to the rest of the public sector, it has to be fair to council taxpayers.”

Last week, Cosla agreed the council tax freeze should be on a “voluntary basis” and the £147m earmarked by the Scottish Government for this purpose should be distributed to all councils with flexibility to raise council tax by up to 5 per cent.

The body had requested an urgent meeting with Ms Robison to discuss its requests.

First Minister Humza Yousaf announced a council tax freeze at the SNP party conference last October without consulting council leaders – a move Cosla described as having caused “real anger” among members at the time.