John Swinney has warned local authorities raising council tax by 10 per cent is “too high”.
The First Minister said councils had been privately “welcoming” their budget funding from the Scottish Government and this was “better” than they had thought they would get.
He told The Scotsman: “I understand the need for there to be increases in council tax, but I think the lower, the better.”
The SNP Government announced £15billion of funding for councils in December’s draft budget. Local authority umbrella body Cosla has described it as “a step in the right direction” but added there are still “significant pressures”
Swinney said: “I think if you had a quiet conversation with council leaders where they were not being bound by certain things, they would say to you, ‘We got a better settlement than we thought we were going to get’.
“I think that’s the case. That’s what they say to me as well in private moments – possibly, they might think these were reckless conversations to have with me, but they’ve had them. And I think as a consequence, that means council tax increases don’t need to be as high.”
Asked if 10 per cent is too high, he said: “I think it is, yes.” He added: “I don’t think that’s necessary, to be honest.”
The FM continued: “I’ve seen some pretty hostile reactions from local government to government budgets over my time, and the local government reaction to the budget this time round has been pretty welcoming, on two levels.
“First of all, local government – and I appreciate this – have acknowledged that the commitments I gave Cosla that there would be substantive engagement about the budget process long before the budget was determined have been fulfilled.
“From my personal point of view, I gave them a commitment that you’ll get good engagement with the government, and they’ve said, well, we got it. So that matters to me that they feel that, because I want to have a good relationship with local government. And secondly, substantively, we got asked to deliver a real terms increase in local government core funding, and we delivered that.”
Swinney also said that the SNP’s flagship welfare policy had reached its limit. The FM said increasing the £26.70 a week Scottish Child Payment could “create a disincentive” for people to enter the workplace. The benefit will only rise by 45p a week next year and will now only rise with inflation.
Asked if above-inflation rises to the payment have been maxed out, Swinney said: “I take that view.” He said: “If you go back to the start of the discussions about the child payment, the Scottish Child Payment started off as a campaign called ‘give me five’ and it was about a £5 weekly payment. If you put that too high, you create a disincentive to enter the labour market.”
Swinney added: “I believe, fundamentally, that families will be in a better position if parents can get into well-paid, sustainable, good quality employment. You’ve got to maintain a very careful balance about the level that you let the Scottish Child Payment to reach or you walk into that disincentive. I don’t think that’s desirable.”
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