Dundee City Council has said it will have to cut £3.4 million from next year’s budget.
The savings are needed to ensure it can meet the Scottish Government’s demand to freeze council tax. The council’s SNP administration and senior officers have until the budget meeting on February 9 to decide where the axe will fall.
But opposition parties have already criticised ministers for failing to give the city the money it needs and called for education services in particular to be protected from the impact of the cuts.
A report by finance director Marjory Stewart shows the revenue grant the council will receive for 2012/13 is £1.4 million less than it got for the current financial year. That fall of 0.45% compares to an average increase of 0.34% for local authorities across Scotland.
She explained that the government used a ”series of complicated calculations” to allocate funds and these were heavily influenced by population data when deciding on the spending needs of individual local authorities.
Dundee’s provisional budget is £360.3 million, of which £45 million will be raised by council tax.
Ms Stewart said: ”Based on current assumptions, the council would require to identify budget savings totalling £3.4 million in order to achieve a council tax freeze in 2012/13.”
Not raising council tax was a key election pledge for the SNP. Ministers made it clear that any local authority which did not agree to do so would face severe financial penalties. In Dundee’s case, it would have had its grant cut by £19.2 million.
The impact that would have had on jobs and services already under pressure after a near-£15 million budget cut this year made such a move untenable, especially with local government elections due in May.
The council has also had to agree to maintain teacher numbers in line with its pupil population, secure places for all probationers who need one under the teacher induction scheme and pass on to the joint board that oversees Tayside Police enough money to maintain police officer numbers.
Ms Stewart added that the council is still examining the details of the grant settlement and ”refining the assumptions and figures” in the provisional budget.
There have been cost pressures in several areas, especially social work, but these have been partly offset by savings, such as the impact of voluntary redundancies and early retirements.
A council spokesman said: ”The settlement is better than had been anticipated in the council’s financial modelling.
”Together with ongoing efficiencies delivered by the Changing for the Future programme during the year, the savings figure of £3.4 million is less than the £9.9 million that had been projected.
”The council’s senior management team will now work up proposals to make savings that can be brought before councillors.”
Labour group leader Kevin Keenan said: ”It’s never good news but we could well have been looking at having to cut a great deal more.”
He noted the council would have been facing ”severe” cuts from the Scottish Government if it did not agree to freeze council tax. Nobody was comfortable with the idea of raising council tax, he said.
”But people will start to realise that the services they once had are no longer there and they will have to consider whether that was the best choice at the time.”
Mr Keenan said he wanted education to be protected from the latest round of cuts as it had taken a ”heavy hit” this year and there was a need to support educational attainment..
He said nursery education also needed to be looked at as his group felt there was under-provision in the city at present.
Liberal Democrat group leader Fraser Macpherson said: ”I would take issue with the claim that the grant settlement is better than anticipated.
”Anyone looking objectively at the actual settlements announced by the SNP government for each authority can see that Dundee has a cash terms cut when other councils have seen a cash terms increase.
”The SNP government has badly let down Dundee in terms of its disappointing settlement for Dundee City Council.”