Dundee leader John Alexander today warned taxpayers face a council tax rise and cuts to services to plug an £18 million budget blackhole.
The council chief said there are “no quick fixes” with the local authority facing “huge challenges” to balance its budget.
The SNP councillor added it is “not his job to sugar coat reality” as he laid bare the stark situation facing the local authority.
He said that to minimise council tax increases the council will have to cut costs elsewhere, including closing buildings to reduce overheads.
The local authority has seen its energy costs increase by around £4 million, adding to the financial pressures it is under.
Dundee budget pressures
In a social media post, Mr Alexander said there is a “perfect storm unfolding” as a result of rising energy costs, “sky rocketing inflation” and wage increases.
He added: “In order to minimise council tax increase, it means we need to reduce costs elsewhere.
“That ultimately means reducing funding for services, funds to external organisations we fund or closing buildings to reduce overheads.
“None of that is easy. None of it is a choice at this stage and none of it will be painless.”
The Scottish Government’s budget began its passage through Holyrood on Thursday.
Fife Council leader David Ross last week issued a desperate plea over a crisis in local government following a “completely inadequate” Scottish Government budget.
‘It’s a nightmare’
Councils receive ring-fenced funding to protect areas such as education, social work and health and social care.
Mr Alexander said while that is “understandable to most”, it equates to roughly two thirds of the council’s budget.
He added: “It ultimately means that you are looking at bigger reductions to the remaining one third of the budget, which might be things like city development, environment, communities or corporate services.
“It’s a nightmare and a minefield.”
Nicola Sturgeon addressed the difficulties facing local and central governments at First Minister’s Questions on Thursday.
She said that if opposition opposition leaders want more money to go to councils “then that is a legitimate proposal to make”.
But she added they must explain what other areas should lose out because the cash “would have to come from the National Health Service, the police budget or other budgets.”
‘Challenging’
A Scottish Government spokesman said: “The Scottish Government recognises the crucial role councils and their employees play in our communities across Scotland and the challenging financial circumstances they face.
“Settlements from the UK Government have suffered a decade of austerity with average real terms cuts of over 5%, equating to a loss of £18 billion.
“Despite this, we have listened to councils and are increasing the resources available to local government to support local services by more than £570 million, a real terms increase of £160.6m or 1.3%.
“We want to work with local government, to build on the Covid Recovery Strategy and agree an urgent approach which improves delivery of sustainable public services.”
Conversation