by OUR LOCAL GOVERNMENT EDITOR
An extra £19.2 million in grant aid from the Scottish Government, representing a 7.2% uplift from last year, seems unlikely to ward off a threatened ten per cent council tax increase and local government service cuts for Borders households in 2025/26.
A warning has already been given that most of the additional cash to be handed to Conservative led Scottish Borders Council is already being used in the current financial year to fund pay rises and the ongoing council tax freeze.
According to senior finance officers and leading councillors, the £292 million settlement for SBC is complex and shrouded in uncertainties.
Over 100 queries about the national settlement for 32 councils have already been lodged with the Convention of Local Authorities [COSLA] and will have to be resolved before a clear financial picture emerges, according to Suzy Douglas, SBC's Director of Finance.
She told councillors the increased settlement would only partially meet the existing funding gap, and further revenue savings will be required to allow the authority to set a balanced budget in February.
And the money allocated by the SNP administration in Edinburgh will not fully provide for the UK Government's controversial rise in employers' National Insurance contributions. It has been estimated the public sector in Scotland will have to find £700 million to cover additional NI payments but will receive only £300 million as part of the settlement.
The Borders budget planning assumption is for a 10 per cent increase in council tax bills which will cost local taxpayers an additional £7 million over the coming financial year.
Before launching the council's annual budget consultation exercise at the weekend, Leagh Douglas, SBC's Executive Member for Finance, told a meeting on Thursday that difficult decisions lay ahead.
In a statement issued by the council to mark the beginning of the consultation process, Councillor Douglas says: "A cross-party group of Councillors along with officers have been meeting regularly to draft plans for the 2025/2026 budget, but we are just part of the process, it’s crucial that we get the input of local people of all ages from across the Borders sharing their views and taking an active part in shaping their communities”.
Council Leader Euan Jardine commented: "“The Council has implemented a range of innovative measures to save money and improve efficiency. However, we continue to face significant challenges, including rising costs of essential services, the impact of inflation and the unique geographical and demographic factors of our region.
“Despite these hurdles, we are committed to remaining financially sustainable in the face of ever-growing challenges and must identify at least £5 million in savings for the 2025/26 financial year to ensure we can continue to provide high-quality services for our communities."
Councillors will have to make financial headroom for a significant increase in interest charges following record levels of borrowing for capital projects in 2024. As previously reported, SBC arranged a series of loans from the Treasury Debt Management Office totalling £136 million in the first eleven months of this calendar year.
Among the questions posed in the online survey is this one: To what extent do you support or oppose the following proposals? An increase of up to 10% in Council Tax to protect local services? The options on offer are 'strongly support', 'support', 'oppose', 'strongly oppose' and 'don't know'.
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