The SNP/Green Government has announced an extra £120m for local authorities in a bid to put the brakes on crippling council tax rises.
Finance Secretary Kate Forbes revealed the extra funds amid a revolt by council leaders and fears her original funding deal would add to the cost of living crisis.
In an unprecedented move before Christmas, all 32 council leaders had written to the First Minister to complain about next year’s funding settlement.
They accused the Government of handing them a £371m cut and said they were “deeply concerned” about their treatment.
Councils feared they would have to make deep cuts to lifeline services as well as increasing council tax during a cost of living crisis.
In her statement, Forbes said next year’s Budget was fully allocated but she expected extra cash from the UK Government for the current year.
She told MSPs: “I am pleased to confirm my intention to utilise the Scotland Reserve to carry forward sufficient funding from this year to next year to allocate a further £120m of resource to local government.
“Councils will have complete flexibility to allocate that additional funding as they wish next year.”
She said of the new money going to councils: “That will allow them to deal with the most pressing issues they face, and at a time when people are understandably worried about the cost of living.
“I would point out that this increase in funding would be equivalent to a 4% increase in council tax next year. So whilst councils have full flexibility in setting local council tax rates, I don't believe that there is a requirement for any inflation-busting increases next year.”
Senior SNP figures were anxious that Forbes’ initial Budget plans would lead to big council tax rises ahead of May’s local government elections.
Any hikes would have kicked in at the same time as gas prices going through the roof, soaring inflation and national insurance increases.
Cuts to services are still likely, but insiders believe councils will blunt any council tax rises.
The u-turn also came after Sturgeon met senior figures at council umbrella group COSLA yesterday.
As revealed by the Daily Record yesterday, officials at Glasgow council drew up a “brutal” options papers for making £34m of cuts.
Ideas include removing free meals for children during the holidays, axing swimming lessons for primary school pupils and withdrawing school dyslexia services.
Other options include hiking cremation fees and a 40% rise in the cost of resident parking permits.
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