First Minister John Swinney has hailed his government’s budget increase for Perth and Kinross Council as it mulls a 10% tax hike for locals.
The cash provided to the local authority from Holyrood for 2025-26 will be increased by 7.8%.
Mr Swinney – who represents Perthshire North – said his government’s budget had given the SNP-run council more than they bargained for.
He previously warned local town halls to “exercise responsibility” when they consider new tax rates.
Perth and Kinross councillors had provisionally agreed a 10% hike earlier this month – the largest rise in the council’s history.
But Mr Swinney said the plan had come before they knew their budget would rise by nearly 8%.
John Swinney: 10% tax hike came before council knew of budget increase
He told The Courier: “Councils deliver frontline services that all of us rely on at different times – from the very youngest in our society to the oldest.
“That is why, in our Scottish budget, I have placed such importance on ensuring we included a fair funding settlement for Local Government.
“There has been talk of Perth and Kinross Council increasing council tax by 10% next year, but that was of course before they knew how much funding they would receive from central government – and our budget is providing them with more than they were planning for.
“But for councils to receive this funding package, it is essential that MSPs across parties back our budget bill.”
Mr Swinney said he was “committed” to improving public services and working with local councils.
But the budget increase comes after a longtime SNP government mandated council tax freeze – which dates back to 2007.
‘Budget increase doesn’t undo harm of underfunding’
Insiders say it’s this policy that has forced many local authorities to implement such significant rises.
A local government source said: “We have been pushed into these kind of increases because of the government’s policy over the last 17 years.
“Rather the gradual increases every year to fund rising service costs local residents have to deal with sudden rises when the freeze imposed by central government is lifted.
“[The Scottish Government] had no choice but to do this after their own budget was significantly increased by the UK Government. But that will not undo the harm caused to local government from years of underfunding.”
The plan for Perth and Kinross would see council tax rise by 10% this year and next followed by an annual rise of 6%.
Rates have been frozen for 12 of the last 18 years.
Finance chiefs say it would more than double their annual income from council tax – which comprises around a fifth of their budget.
Council leader Grant Laing warned that millions of pounds of cuts would have to be made from February if councillors had failed to act.
Perth and Kinross Council did not respond to a request for comment on whether it would reconsider the plans in light of the budget.
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