AceBreakingNews – Local authorities are at risk of bankruptcy if funding from the Scottish government is not improved, council leaders have said.
Ace Press News From Cutting Room Floor: Published: Dec.06: 2023: BBC Scotland News: TELEGRAM Ace Daily News Link https://t.me/+PuI36tlDsM7GpOJe
Cosla issued the warning in a briefing paper ahead of the Scottish budget on 19 December.
The local government body said councils need nearly £14.4bn in the budget just to “stand still”.
The Scottish government said it had given councils a real-terms increase of £376m, or 3%, this year
Cosla’s comments came after Birmingham and Nottingham city councils effectively declared themselves bankrupt.
Both authorities have issued Section 114 notices, which prevent spending on virtually everything apart from statutory services:
In its briefing paper, Cosla stated: “There is a risk this becomes the reality for Scottish councils if the funding by Scottish government does not match growing cost pressures.”
A council tax freeze was announced by First Minister Humza Yousaf in October.
No details have emerged on how much money councils will receive to compensate for this.
The Scottish government insisted the policy would be fully funded.
‘Challenging budget’
Cosla resources spokeswoman Katie Hagmann said that “tough choices” could mean essential services they provide “will cease”.
She added: “Our reality right now is an extremely challenging financial climate coupled with years of real-terms cuts to council budgets, while additional policy commitments are continually being introduced.
She said Cosla had been “clear that cutting frontline staff isn’t the answer” and without funding councils would not be able to provide “sustainable public services”.
Scottish Conservative finance spokesperson, Liz Smith MSP, said Cosla’s warning was a “damning indictment on years of brutal SNP cuts”.
She added “Scotland’s local authorities have been struggling to provide core services for years now and it appears they may finally be nearing breaking point.”
The Scottish government said it was facing “the most challenging budget settlement since devolution” as a result of high inflation and a UK government autumn statement that “failed to deliver the investment needed” in Scotland.
A spokesperson said:
“ The Scottish Government has increased the resources available to local government in 2023-24 by more than £793m, a real-terms increase of £376m or 3%, compared to the 2022-23 Budget figures.
“Decisions on local government budget allocations for future years are subject to the outcome of negotiations with Cosla, the results of which will be confirmed in future Scottish budgets.”
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