Scottish budget deal for local councils is fair, insists Kate Forbes

Finance Secretary Kate Forbes has insisted the cash settlement for councils in next year's Scottish budget is fair - despite claims that she is "short-changing" local government.

Ms Forbes was pressed on the issue on Wednesday after local government body Cosla claimed councils were not getting enough cash to fully fund the Scottish Government's public pay policy.

Cosla resources spokeswoman Gail Macgregor also warned that if the additional money authorities will receive was not maintained, Scots could be facing a council tax hike of 6 per cent in 2022/23.

Ms Forbes refused to say if the funding could be continued, as she was "not in a position to determine what the envelope is for next year's budget".

Finance secretary Kate Forbes. Picture: Andrew Cowan/Scottish Parliament

But with the Scottish draft budget for 2021/22 having allocated £11.6 billion to local government, Ms Forbes said: "I do think in short that it is a very fair settlement."

She stressed pay for council workers was a matter for local authorities, not for ministers – although the Scottish Government has said public sector workers earning up to £25,000 should get a rise of 3 per cent, with higher earners receiving a 1 per cent increase capped at £800.

Cosla has already warned MSPs on Holyrood's finance committee the pay policy will cost £205 million.

Ms Forbes said: "In terms of pay, obviously pay is a matter for local government, we don't have a role in the negotiations with unions on pay and local authorities will take that role."

However, she told the committee there could be more cash to come to Scotland.

The ongoing coronavirus pandemic means Westminster could increase funding for Holyrood, with the finance secretary saying: "I think there will be further funding. Local government is on the frontline in terms of distributing grants and other supports, so yes, local government is a priority."

Tory MSP Murdo Fraser pressed her on the overall allocation to councils.

He said the Scottish Parliament Information Centre (Spice) had said that while the Scottish Government's overall resource budget had increased by 11.2 per cent last year, local government core funding had only risen by 0.9 per cent.

Mr Fraser told Ms Forbes: "That looks like you are short-changing local government, who have of course borne the brunt of many of the issues and responsibilities in relation to Covid, not least rolling out business support."