Friday March 27th 2026
Midlothian Council Leader Kelly Parry
Written by Local Democracy Reporter, Marie Sharp
Midlothian’s council leader has described changes to UK Government funding for local authorities as delivering a ‘sledgehammer’ blow to local services.
Councillor Kelly Parry has written to Scottish Secretary Douglas Alexander MP and Midlothian MP Kirsty McNeill to raise her ‘profound concern’ over the new Local Growth Fund for Scotland,announced at the start of the year.
The fund, which replaces the UK Shared Prosperity Fund, will see millions of pounds shared out through five regional economic areas to support growth.
In a letter to Mr Alexander, published in papers for next week’s meeting of Midlothian Council, Councillor Parry describes the decision to give the funds to regional groups to distribute rather than local authorities as ‘unhelfpul’ and she a “one-size fits-all” regional distribution fails to respect the local expertise of councils who best understand their own unique infrastructure and skills gaps.
However, she said, the most alarming change is the shift on the earmarked funds from revenue to capital spending.
She said: “Under the UK Shared Prosperity Fund capital accounts for roughly 23 -28% of spending; under the new Local Growth Fund, this sky rockets to 70%.
“This “sledgehammer” approach to revenue funded services will have a devastating impact on our local delivery partners.”
And she said a reduction of the funds available Scotland wide over the next three years would also have a devastating effect on the county.
She said: “In Midlothian, we rely on revenue funding to support the delivery of front line services. The 50% reduction in funding by 2028-29, combined with the capital shift, puts more than half of these directly supported jobs at risk.
“For Midlothian, this means losing experienced staff who provide front-line skills training and support to our most vulnerable residents.”
Councillor Parry called on the UK Government to reconsider the new model proposed for the funds as well as engage in ‘meaingful’ dialogue with local leaders.
In a separate letter to local MP Kirsty McNeill, Councillor Parry restated her concerns and called for an urgent meeting with UK Government and an opportunity to brief her on projects at risk of closing under the new funding plans.
Ms McNeill told the Local Democracy Reporting Service £140million in new funding was being provided to Scotland from the Government with additional ‘record block grant settlement” and nearly £12billion in funding to the Scottish Government since Labour was elected at Westminster.
She said: “Last month, I met with COSLA’s presidential team in my ministerial capacity to discuss how we can ensure the new Local Growth Fund works for local authorities and, most importantly, those that we all serve, and will continue to keep Midlothian Council updated on any developments in this area”.
She added: “Midlothian is already benefiting from £300 million in UK Government investment as part of the Edinburgh and South East Scotland City Region Deal. This has, and will continue to, support projects around Midlothian and create thousands of jobs across the region.”
In response to a request for comment from Mr Alexander. a UK Government spokesperson said: “We are backing regional economies across Scotland with £140 million of new Local Growth Fund investment – including £37.8 million for the Edinburgh and South East region.
“Thanks to this cash boost – and additional funding from three other new UK Government programmes – Edinburgh and South East Scotland is receiving up to £74.5 million over the next three years – up to £29.7 million more than under the UK Shared Prosperity Fund in 2025/26.
“These new programmes provide a balance of both capital and resource funding to invest in transformational projects and infrastructure that can stand the test of time, creating lasting jobs and opportunities.”
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