Councils raid reserves to pay for frontline daily services

Cash-strapped Scottish councils are being forced to raid their reserves to the tune of £126 million to plug the funding gap for frontline services.
Councils dipped into their reserves to deal with the harsh winter weather.
Picture: Ian RutherfordCouncils dipped into their reserves to deal with the harsh winter weather.
Picture: Ian Rutherford
Councils dipped into their reserves to deal with the harsh winter weather. Picture: Ian Rutherford

The move marks a £47m rise in the cash used last year from “rainy day funds” by town halls across Scotland.

And the growing use of reserves will see them wiped out in 14 years, according to a Scottish Government report.

Hide Ad
Hide Ad

Almost £750m has been axed from council budgets for frontline services like schools and social care in recent years by the Scottish Government as austerity cuts bite.

The number of local authorities resorting to these measures has also increased in 2017-18 from 19 to 24.

The report predicts a further £113m will be used from reserves this financial year.

Scottish Conservative local government spokesman Alexander Stewart said: “Councils are increasingly dipping into their rainy day fund and that’s a direct consequence of SNP budget cuts.

“It’s a last resort to keep day-to-day services going. It’s not something that can continue – mathematically this option will disappear in little more than a decade if current trends continue.

“Under an SNP government, the financial wellbeing of Scotland’s 32 local authorities has deteriorated alarmingly.”

Total reserves for councils stood at just more than £1 billion in March.

Across the country, some councils are using their savings to a greater degree than others. Last year, Aberdeenshire spent 60 per cent of their reserves, with Midlothian using 52 per cent. But other local authorities didn’t use any at all.

Hide Ad
Hide Ad

Scottish Labour finance spokesman James Kelly said: “This is a deeply concerning report into the finances of councils across Scotland.

“The SNP government has cut £1.5bn from local authorities and now they are forced to use emergency measures in a bid to balance the books.”

A spokeswoman for local government body Cosla said cash was held in reserve for a “variety of purposes”.

She said: “It is to be expected that the planned use of reserves will vary year to year in line with individual councils’ approved published financial plans.

“Some recent examples of this would include contingency sums to deal with the impact of an exceptionally harsh winter, such as we have just experienced.”

A Scottish Government spokeswoman said councils had been treated “very fairly” and would get a real terms increase in budgets this year.

“Local authorities must use the financial resources available as efficiently as possible to ensure the best possible value,” she said.

“How this is done is a matter for each council.”