Council tax freeze means £1m more cuts for West Lothian

Wednesday February 7th 2024

West-Lothian-Civic-Centre


Written by Local Democracy Reporter, Stuart Sommerville

The Council Tax freeze for next year will mean a further £1.4million of budget cuts for West Lothian.

West Lothian’s head of finance Patrick Welsh told councillors that the compensation promised by the Scottish Government fell more than a £1m short of the almost £6m the council could have raised.

The Executive heard the shortfall will now have to be found from further service cuts. Finance officers had proposed a 5.8% Council Tax rise, in line with last year’s rise. That would have raised £5.9m.

The loss of revenue will add to the £38.2 million shortfall West Lothian faces over the next four years.

The First Minister surprised COSLA and individual local authorities in October when he announced that Council Tax rates would be frozen for all bands in 2024/25.

Councils, of all political stripes across Scotland called the freeze a gimic and predicted further hardship.

The Scottish Government promised full compensation for councils.

However, the council’s Head of Finance and Property Services, Patrick Welsh, confirmed that the council tax freeze is not fully funded and the council will need to find an additional £1.4 million of budget savings from local services next year to bridge the gap between the council’s planned Council Tax increase and the Scottish Government funding proposed.

Council Tax is an important source of funding and helps to fund services such as schools, social care and roads and paths. The income from Council Tax is used to fund local services so a reduction in Council Tax means less funding available for local services.

Leader of West Lothian Council Lawrence Fitzpatrick added: “This week, Scottish Water announced that water bills will increase by over 8% and said the rise was needed to provide “significant investment” in replacing ageing infrastructure and improving services.

“Why is it the case that West Lothian Council is then not able to raise Council Tax to invest in critical local infrastructure, such as roads?

“The reality is that councils across Scotland, will in fact, have to reduce spending following the Scottish Government freezing Council Tax, which in-turn reduces our ability to invest in local services.”

West Lothian Council already faces a budget gap, estimated to be around £38.2 million over the four years to 2027/28. Following the Scottish Government Draft Budget announcement in December, insufficient levels of funding for the council combined with increasing costs, mean that council officers need to identify potential options to reduce spending and/or increase income to offset cuts to services.

The options being considered would contribute towards balancing the budget – something the council is legally required to do.

The update was provided to Council Executive yesterday as part of the council’s budget monitoring process.

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