Plenary, 05 Feb 2004

Meeting date: Thursday, February 5, 2004

Official Report 753KB pdf

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Local Government Finance (Scotland) Order 2004 (SSI 2004/14)

The next item of business is a debate on motion S2M-821, in the name of Andy Kerr, on the Local Government Finance (Scotland) Order 2004. There is one amendment to the motion. Members should note that, under standing orders, the debate may last for no more than 90 minutes.

The Local Government Finance (Scotland) Order 2004, which we ask Parliament to approve this afternoon, has real significance. It provides for £7.669 billion in grant support for Scottish councils' revenue expenditure in 2004-05. That is a third of the total assigned budget and it will provide teachers, social workers, police and fire personnel, free personal and nursing care for older people, nurseries, libraries and sports facilities. It will also provide the myriad other essential services that we all rely on our local councils to provide.

The funding for 2004-05 represents an increase of £383.6 million on this year. That increase will allow councils to improve the public services that they provide for the people of Scotland. It will allow them to provide more teachers and to reduce class sizes, to provide fresh fruit and more nutritious school meals for our children, and to support youth justice teams. Those policy initiatives have been developed in consultation with local government and other key stakeholders, and the settlement covers the full cost of those improvements.

The funding in the order builds on the sound financial basis that we and the Scottish local authorities have worked hard to achieve. The figures that I announced at the start of the three-year settlement guaranteed every local authority an above-inflation increase in revenue grant in 2004-05 and 2005-06. The order confirms the funding increases for 2004-05 that I announced then.

The minister says that he is giving above-inflation increases to all Scottish local authorities during the next three years. How much is he giving them if the amount that is associated with new burdens is discounted?

There is that old term again; the member refers to "new burdens". Does he mean new burdens such as free concessionary travel, free care for the elderly and improved nutritional values in school meals? In consultation with the Convention of Scottish Local Authorities, we make sure that we fund those items appropriately and that we build in enough room for growth in local budgets to ensure that councils are, as ever, free to make local decisions. The Executive also continues to provide additional funding to cover inflationary increases and pay increases. I suspect that what the member is trying to get at is that we do not allow councils enough freedom with their budgets to make local decisions—however, that is not the case. If he does not mind, I will move on from that point and talk about some of the work that we have done on local government funding.

The increase in the revenue grant allocation in 2004-05 is 5.3 per cent. As I have mentioned before, that figure would be even higher but for a transfer of funding to the Department for Work and Pensions. We have agreed that in future the DWP will fully fund housing benefit and council tax benefit. Before that transfer, the increase on the current year is 6.5 per cent. The increases for councils are substantially above inflation; they range from 5.3 per cent to 9.5 per cent. As in previous years, the distribution of grants is based on a formula that has been agreed with COSLA. The formula makes an allowance for the additional costs that are associated with deprivation and with serving sparsely populated rural communities, and it contains special provision for the islands. The settlement also protects the councils whose populations are declining most by giving them more grant than their population share justifies.

There is £60 million in the grant allocations for quality of life funding to enable councils to improve their citizens' quality of life. Outwith the local government settlement, we are also providing local authorities with better neighbourhood services fund and cities growth fund moneys in the three years to 2005-06. An additional £31 million is provided in 2004-05 for BNSF pathfinders. That will enable the pathfinders to continue to improve the core services that were developed with the original three-year funding. Over the three years, the £90 million cities growth fund will be a catalyst for community planning partners to come together to take substantive and innovative action in our six city regions.

The minister has described initiatives, some of which are excellent, but he has also talked about three-year funding. Where is the long-termism? Will councils simply find that they must move on to something else? Adopting the American habit of trying short-term programmes causes enormous budgeting and staffing problems. That has not been the traditional system in Scotland, where we have thought about the longer term. What happens after the three years?

That shows the SNP's short-sightedness about some of our work. I do not commit Scottish taxpayers' money to schemes that I think will be unsuccessful, so pilot schemes and schemes that we develop in concert with our local government colleagues to ensure effectiveness have value and benefit. If such schemes are not effective, we should remove them.

A recent example of a scheme is the quality of life fund, which has created a significant change in communities and made a significant improvement in services for young people and the elderly. As a result of that, the Executive has fully funded other quality of life initiatives over the three years of the settlement. The Executive takes a long-term strategic view about why funding those services is important.

Our key interventions, particularly in city regions, allow us to make strategic changes that will deliver for all the communities and partnerships that are involved. The improvements that the partnership Executive has undertaken are making a real difference to the lives of people in Scotland. That is why I am committed to establishing a new improvement service for councils and their partners throughout Scotland. We are pleased that we have established a partnership with COSLA and the Society of Local Authority Chief Executives and Senior Managers to deliver that exciting new service. The service will focus on delivering improvement solutions to key services—in particular, those that need to be delivered jointly by local government and its partners.

We have devoted historic levels of resources to public services. Together with our commitment to reform, which includes the introduction of best value, we have secured improvements. In the past year, Scottish councils have been recognised as being not only good but among the very best in the UK. In the Lothians, top awards have been won for initiatives to heat homes and tackle fuel poverty. Argyll and Bute Council has been recognised for linking remote island communities. Highland Council and North Lanarkshire Council have received exemplary reports from Her Majesty's Inspectorate of Education.

Improvements to councils' delivery of home care services mean that domestic help is available in the evenings, overnight and at weekends. Such local service improvements make a big difference to the quality of life of our young people, the elderly and those who are most vulnerable throughout Scotland.

I would like to take the opportunity to confirm the poundage rate for business rates. I am pleased to confirm the provisional rate that I announced in December. The poundage rate in 2004-05 will have a below-inflation increase to 48.8p. That is a rise of 2.1 per cent, which is well below the retail prices index increase of 2.8 per cent. That is on top of this year's poundage freeze. The cost to the Executive will be £11 million per annum.

This year, we also introduced the small business rates relief scheme, which gives rates relief of between 5 per cent and 50 per cent to up to 70 per cent of ratepayers. That is paid for by a small supplement for larger businesses. In 2004-05, the small business rates relief scheme supplement will be 0.3p in the pound. Overall, those measures mean that business ratepayers pay less in real terms than they did in 1995.

As I said, the order distributes nearly £8 billion of resources to local government. That is £384 million more than was distributed in the previous year.

The Conservative amendment suggests that any consequential funding under the Barnett formula as a result of an increase in the grant that is given to English local authorities should be allocated to Scottish local authorities. That assumption is misguided. We should consider some facts. The massive council tax increases that some in England faced this year did not happen in Scotland. The average increase in Scotland was 3.9 per cent; in England, it was 12.9 per cent. In East Sussex, the increase was 20 per cent, and in Wandsworth, it was almost 60 per cent. Our councils in Scotland are already receiving above-inflation funding increases and have done so for several years.

What is the point of devolution if we do not decide how we spend the resources for Scotland? We could have no free personal care for the elderly, no free and concessionary travel, and none of the other many benefits that have come to Scotland as a result of devolution.

Let us also remember that the consequential funding is a one-off. I have, however, laid down a challenge to my local authority colleagues and all those in the public sector to offer proposals that will ensure maximum impact for the longer term. We need to ensure that this money can make a real difference for Scotland's future. That challenge is not exclusive.

Will the minister take an intervention?

I am sorry, but I am in my last minute.

Let me make it clear that it is for Scottish ministers to decide how best to allocate the money to benefit the people of Scotland and that we will do so only after considering all the options. With this order, we can improve services. The Scottish Executive and local authorities, working in partnership, will improve the quality of life for all people in Scotland.

I move,

That the Parliament agrees that the Local Government Finance (Scotland) Order 2004 (SSI 2004/14) be approved.

I was interested to hear the minister's peroration. It was as slick as his hairstyle but just as out of date. I recommend to him a more prudent style, such as mine, with more prudent policies to match.

We chose to amend the minister's motion not because we do not believe that the Scottish Government should set in place the arrangements to fund council services—of course, we support that principle—but because I wanted to illustrate that Conservative members have an entirely different view of local government funding. We seek to provide an oppositional point of view. My colleagues will touch on a number of issues that I do not have the time to cover. I want simply to point out that we believe that the level of council tax throughout Scotland is too high and is hurting.

We know that there is a great deal of anger over the levels of council tax. I understand people's concern and genuinely feel their pain. What I do not share is the belief that the tax should be abolished and replaced with another tax. In our opinion, the root of the problem lies in the high level that council tax has reached, with a great deal of the blame resting with the Government's willingness to burden local councils with greater costs. In particular, I mean the UK Government, although the Scottish Government does not get off scot free. Increased national insurance and pension contributions are two examples of the increased expenses that councils—like the national health service—have had to face.

I have no doubt that, were the levels of council tax lower, the clamour for its abolition would recede. The thrust of my amendment is to point out the fact that we feel that levels of council tax should be lower.

Can we think this through? Between 1993-94 and 1997-98, under the Tories, local taxation—council tax—rose by 26.8 per cent in real terms whereas, under the Executive, it has risen by much less in a similar period. I find it difficult to understand how the member can forget history and say that the Government is burdening local government when the Tory Government did that more than the Executive has ever done.

I am not here to defend the decisions of previous Conservative ministers, to which I might have objected. It is not hard to find many Conservative councillors who disagreed with some of those decisions. However, I can tell the minister and Parliament that the line of this Conservative group—this Conservative party, here and now—is that the level of council tax is too high and that it is our commitment that it should be reduced.

Will the member give way?

I must make progress. I shall come back to Bristow Muldoon if I have time.

My Tory colleagues in Stirling have proposed savings within current spending constraints to achieve a saving of £180 for each council tax payer over the three-year funding period. That is almost £60 each year, and it has been costed and delivered with better services through the removal of needless bureaucracy and pet political projects. I cite that as an example of a party that is committed to trying to reduce tax and offer an alternative. On the issue of local taxes, the SNP's views are—yet again—unknown. I look forward to hearing SNP members' speeches in that regard.

I turn to the illiberal Liberals. Their alternative to council tax is a local income tax that, were it to be collected on the basic rate, would require the addition of 8p to the 22p basic rate. That would mean that a couple on average wages who live in the typical band D house and pay £1,009 would see their tax bill shoot up to £2,668, which is an increase of £1,659.

The Liberal Democrats claim that a local income tax would result in only 3.75p more on income tax because it would apply across all the tax rates. However, having looked at the figures, I can tell members that such a policy would mean that, even in Fife, the typical couple would end up paying £479 more. In Stirling, they would pay £614 more.

We believe that people know best how to spend their money. We believe that councils know best how to spend their money. That is why we believe that Gordon Brown's rebate of guilt, which has been provided for councils in England and Wales, should also go to councils in Scotland. We should leave councils to decide how best to spend their money. That would give Scottish council tax payers £25 a year rebate, which we think would be worth while. That is a real alternative from the real Opposition.

I move amendment S2M-821.1, to insert at end:

"but, in doing so, considers that any consequential funding under the Barnett Formula accruing to Scotland as a result of an increase in the grant given to English and Welsh local authorities will be allocated to the Scottish Local Authorities' Revenue Support Grant."

First, I thank all the members from the various parties who accepted my e-mail invitation to speak for the SNP in today's debate. I think that, as always, I struck a consensual tone. I thank Mary Scanlon and Cathy Peattie for their kind offers but, as they can see, I decided to stick with the A team.

I was interested to hear Brian Monteith say that he was not prepared to defend previous Conservative Governments. That is a new and slightly surprising admission. I am not quite sure whether Margaret Thatcher was too much to the left or too much to the right for Brian Monteith, but we can discuss that another day. As for his hairstyle, I can only say, "Hair today, gone tomorrow"—a bit like Conservative Governments.

There is no doubt that the public are sick and fed up with the council tax rises that we have seen over a long period. The council tax was introduced by the Conservatives as a panic-measure political fix to get them off the poll tax hook. In the event, the council tax did not help the Conservatives and, since inheriting it from them, new Labour has increased the level of the tax substantially. Since 1996-97, the average band D council tax has risen from £708 to £1,009. Had the council tax increased simply in accordance with the rate of inflation that applied in that intervening period, the average council tax bill would be £842, which is a substantially lower amount.

It is fair to point out that a higher council tax burden now falls on senior citizens and others who are on fixed incomes, given that council tax now takes up a higher proportion of their available income. That is what has caused the protest, the unrest and the anger.

I am interested in Fergus Ewing's analysis of the council tax, but will he perhaps announce to the waiting public of Scotland the SNP's alternative to the council tax?

I am glad that the member has spotted that the public in Scotland are waiting for a Government that understands the anger about the council tax. The SNP has always argued that any system of local government finance must be related to ability to pay. That is the fundamental flaw with the council tax.

A further flaw that exists in Scotland's council tax that is not mentioned by the Conservative or Labour parties is that we have a different banding regime. I note that the Minister for Finance and Public Services is looking at me with close interest, as well he might. In Scotland, a house that is worth £50,000 is in band D, whereas in England a house worth £50,000 is in band B. Pound for pound, England's council tax bills are lower. Similarly—I am glad to see that the finance ministerial team is taking notes—a house that is worth £60,000 is in band E in Scotland but in band C in England.

When I raised that point in previous years—in those distant days when the Tories were at the helm and Brian Monteith had a different hairstyle—the explanation that I was given was that houses in Scotland had different values from those that applied in England. Arguably, that is no longer the case. There is a real problem. I do not know whether I have time to take an intervention from the minister.

As I know that the member is running out of time, I am waiting with bated breath to hear his policy on local taxation.

As I have already explained, the SNP has always argued that local taxation must be directly related to ability to pay. That remains the position.

The hunt for a perfect tax will be pursued many times and over many years. A local income tax is a method of taxation that is operated successfully in many countries. Although there are many difficulties with it, the same applies to every form of taxation. However, as a method of taxation it is more directly related to the ability to pay than the council tax is. Neither of the unionist parties is willing to face up to that. That may pose them serious difficulties in the days ahead.

I suggest to Fergus Ewing that more Labour and Liberal Democrat members may have responded to his e-mail requesting speakers because we have something that we want to say and that is worth saying in this debate. However, I am pleased to hear that he seems to be coming around to seeing local income tax as a preferred method of funding local government. Perhaps he will join us in making a submission to the independent inquiry, when that is set up, to put the case for a local income tax very strongly. The Liberal Democrats will do that—we will put our money where our mouth is and provide the details of how much such a tax would cost.

Our current estimate is that a local income tax would cost an average of 3.75p in the pound across the United Kingdom. However, we will do a council-by-council calculation and publish those figures later this year. I tell Brian Monteith now that they will be nowhere near the fantasy figures that he published yesterday. If the Minister for Education and Young People were here, I would want him to check whether the maths department at Portobello High School has improved since Brian Monteith was there, because the fantasy mathematics that he produces in every debate about local government finance are unbelievable. He is a finance spokesman, but he cannot do sums, which is very worrying.

During First Minister's question time the Conservative leader, David McLetchie, repeated the myth that since 1997 the council tax has risen by 43 per cent. The Conservatives are now bandying about the figure of 50 per cent—they seem to have rounded it up. The council tax has not risen by the amount that they claim. The 1997 council tax increase took place under the Conservatives—in that year, council tax was set by the Conservatives rather than by the Labour Party. The Scottish Parliament was established in 1999 and set the council tax for the first time in 2001. Since then, council tax in Scotland has risen by only 18.85 per cent. Over the last four years of the previous Conservative Government, it rose by 41 per cent. At the same time, the Conservatives were slashing services. We will not take any lessons from them about the funding of local government.

Does the member accept that it was necessary for the Conservatives to raise council tax, but that the additional rises in council tax that have taken place since then are over and above the increases that the Conservatives introduced? If there was a problem with council tax, the Executive could have cut it.

I am saying that the Conservatives managed the double whammy of hiking up council tax to ridiculously high levels—a 40 per cent increase over four years—at the same time as cutting local government services. The Liberal Democrat-Labour Administration is about protecting and improving our local services. That is why we have invested record amounts in local government. Over the past three years, we have increased funding year on year, over and above the rate of inflation. I accept that some of that funding is intended to fund new initiatives that are being implemented in agreement with local government, such as concessionary fares, free care for the elderly and increases in teachers' and firemen's pay. However, it is also available for local government to fund its priorities.

Will the member explain why Aberdeenshire Council, which is run by the Lib Dems, is complaining to me and other MSPs for the area that it is inadequately funded and that the level of grant that it receives is below the floor at which it can provide services? In spite of the allegedly generous settlement that has been made, the council has been forced to cut services again this year.

I am sure that my colleague Nora Radcliffe, who will speak later in the debate, will put the case on the figures for Aberdeen City Council and Aberdeenshire Council. I think that the leader of Aberdeenshire Council will recognise that the money going to that council has increased significantly. The position now is certainly somewhat better than it was four years ago. No council will ever say that it has enough money. If I were a councillor, I would never say that my council had enough money. We would always want more money and we would always want to do more, but the reality is that the Administration has reversed the cuts in funding.

An important issue that has not yet been addressed is the prudential regime for borrowing. That is an extremely valuable measure, which is coming in this year for the first time. It means that Fife Council, for example, which in 2002-03 was able to borrow £17 million to fund capital projects, will be able to borrow £30 million in 2004-05 to invest in capital projects. That is investing in services in the community to make services better and it is often investing to save, which Conservatives should welcome.

I will explode a myth that the SNP and the Conservatives seem to want to perpetuate. The myth is that Scottish businesses pay higher rates than their counterparts in England. The SNP and the Conservatives seem to forget that rates are a combination of two things: not just rate poundage but rate poundage times rateable value. Since 2000, rateable values have gone up by less in Scotland than they have in the rest of the UK—they have gone up by about 15 per cent on average in Scotland and by 25 per cent on average in England.

In real terms, most businesses in Scotland now pay, on average, less than their counterparts in England pay. In fact, a business that had a £10,000 rateable value in Scotland in 1999 is now paying £82 less per year in rates than an equivalent English business would be paying if it had had the average increase in rateable value. Businesses are getting a better deal in Scotland because we are putting up rates by less than inflation, whereas in England rates are going up by inflation. Which do members want? Do they want inflation increases in rates or do they want Scottish businesses to be better off?

I apologise for speaking a bit slowly and softly; I have a sore throat today.

First, I noticed that Brian Monteith mentioned Stirling twice, if I heard him correctly, in his speech. I wonder when the other people in Mid Scotland and Fife will get the same representation—certainly in terms of mentions in speeches, if perhaps not in reality. That might happen at some point in the future.

I welcome the minister's continuing commitment in today's announcements to funding public services. I am sure that local authorities will also appreciate the benefits that they obtain from the flexibility that is afforded by the three-year settlement of their revenue budgets. I notice that the COSLA's briefing says that there are no surprises. An essential point about local government finance is that it is now on a much more stable footing and councils know exactly what is expected. That is welcome.

The three-year settlement allows local authorities to plan their budgets more effectively, to manage their resources with some degree of certainty for the coming years and to deliver the quality services that are demanded by their constituents. However, I make a plea, on behalf of smaller local authorities—such as my own in Stirling and the local authorities around my constituency—that cannot benefit from economies of scale in their organisations, that we do a lot more work on that issue.

I trust that in the forthcoming review of local government finance the Scottish Executive will look carefully at future grant-aided expenditure calculations in order to take account of significant local characteristics such as increasing population. I know that Bristow Muldoon has problems of increasing population in West Lothian. That is also happening in Stirling, where there is an increasing concentration of population at the centre and a more widely dispersed population over a large rural hinterland.

I am aware that community planning in Stirling is leading to greater demands on the budgets of all public agencies. Greater flexibility must be encouraged among all the partner agencies in order to assist local authorities in taking a lead in meeting communities' priorities. Stirling is possibly leading the way in terms of community futures and such developments.

The new spirit of partnership that the minister introduced among the Executive, local government and communities is to be applauded and is leading to more investment, more teachers, more social workers and more police. Just the other day in my constituency, it was announced that 67 additional police officers will be recruited over the next two years. The increase in police numbers is a direct result of the flexibility that has been given to the three constituent local authorities in respect of their financial contributions to the joint police board for central Scotland. That flexibility would have been impossible under previous financial regimes.

The policy of addressing the shared priorities of local government and the Executive and of working more holistically means that added value is directed to public services that require more investment. For example, it is good to see that it is possible to deliver more improvements in care services for the elderly. When that is considered alongside joint working between local authorities and health boards, it means that there will be real improvements in the way in which our elderly population will be cared for in the future.

The problems of disadvantage in urban and rural communities in Stirling will also be addressed by today's announcements. Communities such as Raploch, St Ninians and Cornton, which have been blighted by underinvestment in their physical and social well-being, will take heart from the fact that years of cuts in vital public services—yes: cuts under the Conservatives—are now being reversed.

I am also pleased that the new prudential borrowing regime, which Iain Smith mentioned earlier, will allow local authorities greater investment in capital projects. That will offer more flexibility and it will complement the use of public-private partnership schemes to provide new public assets, such as schools, where level playing field support applies. Prudential borrowing will extend the scope of projects and provide opportunities for new investment in waste strategies, roads infrastructure, libraries and sports facilities.

Finally, the increase in financial assistance that the minister announced means that local authorities can fund public services with some certainty that council tax levels will be contained within responsible limits. I urge all members to support the motion.

Budgets and the Local Government Finance (Scotland) Order 2004 are all about distribution and therefore about how to allow local authorities to maximise the use of funds for service provision.

The gross headline increase in grant support from aggregate external finance that has been awarded in the local government finance settlement to Angus Council is £9.35 million. That figure has been publicised by the Scottish Executive and, on the face of it, appears to be extremely generous. However, we should note that a large proportion of the headline increase will be accounted for by new burdens and government initiatives. The remaining sums that are available to the discretion of the council are significantly outweighed by budget pressures. After adjusting for the removal of £1.57 million of grant support in respect of housing and council tax benefit residual subsidy, Angus Council has a net grant increase of only £7.78 million.

The trumpeting of large increases in grant support for local authorities has had the effect of falsely increasing the general public's expectations, which local authorities throughout Scotland will have to dash.

Will the member take an intervention?

I have only a very short time.

Scottish local government is being underfunded at a time when the Scottish Executive has stashed away cash in substantial contingency funds. Taxpayers' money should not be stashed away in Andy Kerr's back pocket; it should be used to fund essential but underfunded local authority services. The reality of such settlements is that Scottish local authorities are forced to follow the Scottish Executive's priorities, rather than the Scottish Executive meeting local authorities' actual needs.

I see that the SNP is on the side of splashing the cash today; it is sometimes the other way round. The member argues that I have money in my back pocket, but I have said in my statement on the spending review and at other times subsequently that we had to put money aside for known pressures in the future. I argue that that demonstrates good fiscal responsibility.

The minister will have that argument with COSLA. The important thing is that the funds should be used, but I suspect that they will be used as we approach elections, perhaps to gild the lily. Who knows? If that is the case, it will be irresponsible. I hope that the Executive, as I said, will maximise the money that goes to provide services for the people.

The Executive is in danger of creating the worst of all possible worlds by ring fencing Scottish Executive priorities while underfunding basic council services. The situation is strange, given that many Labour MSPs come from local authority backgrounds; the situation is very different from the howls of anger when the Tories were in power and constantly starved Scotland's councils of necessary funding.

Scotland's councils are expected to deliver a massive range of essential high-quality daily local services with rising standards and new obligations, but with minimal staffing levels and standstill or reduced budgets. Many Scottish Executive initiatives are now based on short term ring-fenced money, which means that local councils cannot sustain staffing levels and that councils and employees must plan ahead for the short-term only. I await the reality that the minister has described. Like him, I hope that the individual initiatives work, but he must understand that the situation makes it difficult for councils that are budgeting to maximise the money that they receive.

Labour has increased overall Scottish local authority funding, but that has more to do with decisions in England and Wales and the working of the Barnett formula than it has to do with a sustainable and coherent funding policy. Unfortunately, the prospect for local authorities in Scotland is that there will be rising council tax bills and overstretched services, which is the worst of all possible combinations.

Late or delayed information about grant levels also restricts councils' ability to budget effectively. I therefore ask the minister to clarify when the supporting people initiative grant levels will be announced. I also ask him what he is doing to ensure fairness, given that a significant proportion of the increases that have been announced relate to items over which councils have little or no discretion. Many measures will hinder rather than help local authority budgeting, such as the hypothecated sums for specific Government initiatives, the new burdens that must be met from within existing budgets, implementation of the McCrone agreement, transfer of an element of teachers' pension funding from Her Majesty's Treasury and implementation of the Mental Health (Care and Treatment) (Scotland) Act 2003.

It is disingenuous of the Executive to announce that local authorities will get extra funding next year without also saying that it has told those authorities what 70 per cent of the money will be spent on. In Angus, £6.5 million is for new initiatives and non-discretionary services that the Executive wants the council to provide. The remaining £2.9 million is an increase of less than 1 per cent on last year's grant and will not be enough to cover the increases in the costs of core services. Councils throughout Scotland face that prospect. The money is available now; the problem is to get it to where it is needed and to where it will be used most efficiently and effectively.

This year's funding settlement for local authorities is a reflection not only of the importance that the Executive places on the vital public services that local authorities deliver, but of the fact that it is asking local authorities to achieve more than they have done in the past. The minister has stated before that adequate resources are being given to councils to carry out their new duties. Surely the figures speak for themselves. We should all welcome the year-on-year increases in funding that local authorities will receive, which will be 5.2 per cent next year and 4.2 per cent the year after that. By 2006, the Executive will be giving Scottish local authorities just short of £8 billion.

Andrew Welsh raised the issue of three-year settlements, but they are by far preferable to the previous one-year settlements for councils because they allow councils to plan and to manage resources better. The new prudential system for capital funding is a welcome empowerment for councils in setting their agendas for important investments. I welcome the agenda of empowering local decision making.

I am well aware of the impact of the new funds at local level because councils in the north-east are benefiting from it. Aberdeen City Council will receive an increase in funding of nearly £10 million between 2004 and 2006. The issue is not only about overall spending, but about specific initiatives. Aberdeen and Dundee have benefited from funding from the cities growth fund. In Aberdeen, that means a £2.5 million investment in a variety of projects to encourage economic growth and regeneration in the city. That money comes on top of the investment in the intermediary technology institutes that are to be based in Aberdeen and Dundee and the investment in the western peripheral route, which will benefit not only Aberdeen but the whole region.

The minister will be aware that some councils still argue that they need more resources. The Deputy Minister for Finance and Public Services recently met Aberdeenshire Council to discuss its fair share campaign. Is he aware that Aberdeen City Council is also campaigning for a higher funding allocation? It argues that its present allocation is the lowest per capita in Scotland. Perhaps he could tell us in closing whether he agrees with the case that that council is making.

I, too, received an e-mail today—to which Brian Adam referred—from the leader of Aberdeen City Council. In the e-mail, she says that the current funding for the council means that the council is considering raising council tax by a figure that is several times the rate of inflation, which I find to be concerning and surprising. I wonder whether the Deputy Minister for Finance and Public Services can tell us whether the Executive believes that Aberdeen City Council needs to increase council tax so much to balance the books.

Population decrease is another issue of concern to councils in the north-east—I am sure that that concern is shared by councils throughout Scotland. Two of the worst projections are for Aberdeen and Dundee, with declines of 17 per cent and 14 per cent respectively predicted by the Registrar General. The minister has in today's debate again made a welcome commitment to providing funding for councils that have to address such circumstances. I hope that the Executive will monitor the situation and respond appropriately.

I am aware that the funding settlement is generous for local authorities. It would therefore seem to be bizarre if it were followed by large council tax increases in some areas. I welcome the additional funding that the settlement will bring to local authorities, but I would be interested to hear the deputy minister respond to the concerns that authorities have expressed. I hope that the Executive will continue to give our local services the investment that they need, as it has certainly done in this welcome funding settlement.

I welcome the opportunity to contribute to the debate and am delighted to leave the issues of consequential funding under the Barnett formula to my colleagues Brian Monteith and Ted Brocklebank.

I would like to concentrate on the accountability of local government in providing high quality and value for money in public services. I listened carefully to what the minister said—I noted what he said about working with COSLA on a review of joint delivery and improvements. Obviously, the minister also has concerns.

I acknowledge that some improvements have been made. However, it is also incumbent on us to recognise that there have been significant failures. I am not calling for more ring fencing, but for local government to allocate resources that are in line with statutes that are already in place and that will support bills that are in passage and those that have been passed in good faith by Parliament. I refer mainly to my concerns over the Mental Health (Care and Treatment) (Scotland) Act 2003, the Community Care and Health (Scotland) Act 2002 and the Antisocial Behaviour etc (Scotland) Bill.

In a written answer to me, the Minister for Finance and Public Services stated:

"Local authorities are in general free to set their own expenditure priorities."——[Official Report, Written Answers, 17 November 2003; S2W-3491.]

What system of accountability or indeed sanctions does Parliament have that can ensure that statutory obligations, national standards, policy objectives and priorities that we set in good faith are met by local authorities throughout Scotland?

I will give some examples from Audit Scotland reports and my own correspondence. Children with special needs have been sent home from school in Inverness because there was no learning support teacher and some 22 per cent of children on supervision have no social worker, according to Audit Scotland. In the Highlands, it takes 11 months for a terminally ill patient to be seen by an occupational therapist.

This week, I received a letter from a person who has had two amputations and lives alone. He has no means of bathing or showering, but he has had no contact from the council for the past six months. He stated that it appeared that his big mistake was to want to go home after his operation in July last year and to try to live a normal life after his two amputation operations. He stated that if he remained in hospital, perhaps the work would have been completed.

Highland Council roads are now upgraded every hundred years, compared with every 25 years under the Tories. Patients are left languishing in hospital at greater cost to the taxpayer because social work departments have no money to pay care home fees. An example from yesterday concerns a gentleman in Thurso; there are eight places in the local nursing home, but the social work department has no money to place him there.

Only seven councils in Scotland deliver the required level of service to children on supervision and 27 per cent of special educational needs assessments take more than a year to complete in the Moray Council area. The money that is due for council house rents—excluding Glasgow and the Borders—is £28.5 million, with £25 million being lost as a result of empty houses.

Those are only a few examples of local government's failure to provide high-quality public services to vulnerable people, to whom services matter so much. I want to ask of the minister only one thing today. I want him to talk not only about money being poured into local government, but about local government's service levels, outcomes and ability to respond to needs. Is local government getting enough money or is it providing local services inefficiently? When we criticise local government it says that it does not have enough money. However, the minister says that it has enough money. We need a clear, unambiguous statement about that. Either local government has enough money and is spending it wrongly and inefficiently, or it does not have enough money to provide the required services, which results in examples such as I gave. What does the minister intend to do to respond to some councils' failures to deliver certain services?

Well, here we are again, debating local government and welcoming increases in the amounts that are going into local authority coffers. We have a Labour-led Scottish Executive—so no surprise there. Indeed, it is difficult not to become blasé about the record that the Scottish Executive has established in delivering much-needed funding to our local authorities—but we must try.

I take this opportunity, therefore, to welcome again the Executive's commitment to increasing funding for local government. I am pleased to see, from the minister's announcement, that real increases have been found for local government, which will see it continue to benefit from the minister's sound handling of the country's finances. Three-year settlements, I believe, are an important aspect of the way that local government budgets are produced. Such settlements enable local authorities to plan budgets better, to manage them more effectively and to deliver the quality of services to which we in the Labour Party especially are committed.

I particularly welcome the increases in aggregate external finance to North Lanarkshire Council and South Lanarkshire Council, which amounts for North Lanarkshire to a 5.9 increase in the financial settlement for 2004-05 and a further 5 per cent increase in 2005-06, while South Lanarkshire will get increases amounting to 6.7 per cent and 4.7 per cent respectively. As for other local authorities, the settlement provides an above-inflation increase in revenue grant from 2004 to 2006. That has to be welcomed and will guarantee that the Lanarkshire councils can continue to work towards raising standards and responding to local needs, bringing lasting improvements to the quality of life of the community and continuing to build on investments and innovations that already benefit local citizens and economies through the work of the local authorities. That work goes from the large-scale physical improvements to roads and buildings to improvements in lifestyles, such as providing a piece of fresh fruit for schoolchildren. However large or small those things are, the variety of projects will make a meaningful difference.

In addition to the AEF support that was announced in the settlement, I am pleased to note the extension to current funding arrangements for the better neighbourhood services fund. The sums that have been announced will enable the councils and their partners to continue to provide more strategic services in North Lanarkshire and South Lanarkshire. However, the future of the BNSF and the social inclusion partnerships funding remains under debate, so I urge the Executive to safeguard council funding in those areas.

I welcome the Executive's commitment to funding the new services and policies that local councils are being asked to deliver. As the main providers of education, the councils are committed to the Executive's five national priorities to improve standards at every level. For example, South Lanarkshire Council is looking to achieve a 10 per cent reduction in the time that teachers must spend on administration, with a commitment to achieving the recommendations of the report "Time for Teaching: Improving Administration in Schools" by 2005. That must be welcomed.

I am also pleased to see that through the national priorities action fund—which is replacing the previous excellence fund within education—an additional £1.66 million will be given in the settlement as a specific grant to North Lanarkshire Council. That is a welcome package, which is earmarked for the nutrition in schools initiative, with the dual purpose of providing fruit to primary 1 and primary 2 children as well as improving the overall nutritional value of school meals. It is vital that the Executive and local government continue to work towards the provision of healthy and nutritious food in schools and towards the promotion of health in general. The settlements this year will obviously help that.

In the light of the Executive's commitment to challenge antisocial behaviour, and to address youth crime within that, I welcome especially the increase to the Lanarkshire councils' funding allocation to tackle youth crime. The purpose of the increase is to build on progress that has already been made by reducing the number of persistent offenders and achieving the national standard for youth justice by 2006. Both Lanarkshire councils are committed to safer communities for everyone, with initiatives such as the antisocial task force in North Lanarkshire and the antisocial behaviour teams in South Lanarkshire. Those initiatives are at the heart of the councils' efforts.

Today's announcement is a good illustration that the Executive is confirming its commitment to communities and local government and to the policies and initiatives that are implemented by local authorities by yet again putting its money where its mouth is. Above-inflation increases will allow authorities to continue to improve the public services that they already deliver, to reduce class sizes and to support youth justice. It is a good settlement and I welcome it.

Before the debate began, I was asked by a colleague—perhaps slightly tongue in cheek—whether I would be making the Aberdeenshire speech in this debate. In a sense, I will, but I make no apology for that because I want to use Aberdeenshire to illustrate the need to simplify the grant distribution system.

The current system is extremely complex: hundreds of factors are used to make adjustment upon adjustment, to the extent that the final outcome is certainly not transparent and is very often felt to be unfair. Aberdeenshire Council is the fourth-largest local authority in area in Scotland. It is responsible for 10 per cent of Scotland's roads, but it has the lowest ratio of staff per head of population of all local authorities in Scotland and it maintains a council tax level in the lowest quarter of all Scottish councils. By almost any measure, it is an efficient and well-run local authority, but Aberdeenshire Council believes that it is penalised to the amount of 11 per cent by the current system.

I am not going to argue for or against that figure—the argument that the current system is perceived to be unfair and not transparent is illustrated by speeches that have been made by other members. Almost anybody can pick out something that leads them to say that the final outcome is unfair for some reason or other. We need much more simplification, because the current system seems to throw up some strange outcomes.

I dug out a speech that I made on local government finance in November 2000. I said then:

"Some of the outcomes of this year's allocation demonstrate how much cause there is for concern. For example, is it not strange that Glasgow's allocation of grant-aided expenditure money for school transport last year was £1 million more than that for Aberdeenshire? Aberdeenshire, a rural authority, was transporting 8,000 more pupils and, in some instances, daily transporting pupils with special educational needs over long distances. I reiterate that: £1 million more for 8,000 fewer pupils."—[Official Report, 22 November 2000; Vol 9, c 266.]

That was in 2000. I fast-forward to 2004 and quote from a speech by my colleague, Mike Rumbles, in last week's budget debate. There was no collusion; he made his comments without reference to what I had said previously. He said:

"Aberdeenshire Council will receive around £3 million from the budget to provide transport for school pupils in what is a large rural area … However, Glasgow City Council, which has a similar number of pupils who require transport in a much more compact area, will receive … £10 million."—[Official Report, 29 January 2004; c 5397.]

If anything, the situation seems to be getting worse.

There is to be an independent review of local government finance, the outcome of which must be a greatly simplified and demonstrably fairer way of distributing available resources among councils and among all the people of Scotland.

We now move to the wind-up speeches. I call Bristow Muldoon. Mr Muldoon, you have five minutes.

Thank you, Presiding Officer. You caught me unawares by moving to the winding-up speeches so quickly.

Overall, it has been a good debate and many members have made strong contributions. I will not be able to comment on every speech in the limited time that I have available, so I apologise to those members whom I do not mention.

Brian Monteith believes that council tax is too high; he does not believe that it needs to be abolished, but he believes that it needs to be reduced. I contrast that with the speech that was made by Mary Scanlon, who drew attention to a number of areas in which she saw problems in local service delivery. She said that a number of councils have advised that they do not have sufficient money to fund several key social services. The Conservatives cannot have it both ways, with Brian Monteith saying that there is too much money going into local government and that council tax is too high, while Mary Scanlon raises concerns about services.

Will Mr Muldoon give way?

I am sorry, but my time is limited and I want to deal with a number of points.

I turn to Fergus Ewing's speech. Again, we see a contrast in the position of SNP members during a single debate. This morning, Brian Monteith and I agreed that SNP members could not advocate a situation in which there were Scandinavian levels of public services and Irish levels of taxation.

Fergus Ewing said that people were fed up with the level of council tax rises. I presume that the implication of what he said is that council tax should fall. However, by the same token, Andrew Welsh made the point that he believed that the settlement for Angus Council, and presumably for a number of other councils, was too low.

Will the member give way?

I am sorry, but I have only four minutes.

In this morning's debate on the Scottish economy, Jim Mather said that the SNP wants to cut business taxes. The SNP cannot have it every way: it cannot have low levels of taxation and high levels of public spending. The SNP should be a bit more honest and consistent in its arguments, and its members should not argue against one another in the course of the same debate. The minister challenged Fergus Ewing on the SNP's policy. Ultimately, Fergus Ewing almost made the suggestion that the SNP would introduce a local income tax. I note that Iain Smith made reference to the Liberal position on a local income tax.

The Parliament's Local Government and Transport Committee will look very carefully at the Executive's proposals for a review of local government finance. I point out to Iain Smith and Fergus Ewing, however, that the previous Local Government Committee produced a report on local government finance in which it concluded that the council tax was a sound system of local taxation.

My personal view is that we could reform the council tax and make it better and fairer; that is the road that we should look at in the future. Local income tax could be very expensive for local authorities to collect. Indeed, it could produce a variable yield for local government.

Will the member give way?

No. I am sorry but my time is very limited.

You have time, Mr Muldoon, if you wish to give way.

Do I? I am sorry; I thought that I had only four minutes.

Does Bristow Muldoon recollect that the Local Government Committee's report on local government finance also reported that a feasibility study should be conducted into whether we could introduce a local income tax?

I am happy to recognise that, but I do not think that the case has been made for a move to a local income tax. The concerns that have been raised about the level and predictability of yield mean that the introduction of such a tax could be a serious threat for local government.

Given that I have more time and that I rejected earlier interventions, I am happy to take an intervention from Brian Adam.

I am grateful to Mr Muldoon for taking the intervention. Perhaps he is not aware that the Irish Government abolished local taxes completely and yet there does not seem to be a problem in the provision of local services in Ireland.

The problem is that the SNP advocates Swedish levels of public expenditure and Irish levels of taxation, which would create an even bigger black hole than the SNP has advocated in the past. SNP members should go away and study a little bit of economics before they make such silly statements.

I agree entirely with the point that Sylvia Jackson made about the needs of the local authorities that have rising population levels, one of which is Stirling Council. Sylvia Jackson pointed out that that issue also affects my constituency; indeed, it affects the whole of Edinburgh and the Lothians. The Executive needs to address that issue to ensure that future local government settlements take account of the situation of the local authorities that have to fund services for higher levels of population. That need is felt most acutely in areas such as West Lothian, in terms of the costs that are involved in providing for school populations.

Will the member give way?

No thanks; not just now.

The prudential borrowing regime is a significant step forward for local government. Local authorities across Scotland are able to be more flexible in their planning, particularly in relation to future capital expenditure. I draw the attention of ministers to the fact that West Lothian Council has been able to expand its capital programme over the next three years to £304 million, which is a dramatic increase on the amounts of money that it has previously been able to commit to the improvement of public services.

Overall, the settlement is good for local government. It enables the local authorities to build on the stability of their funding. It provides above-inflation increases for every council in Scotland and extra flexibility through the prudential regime. The settlement will enable local authorities in Scotland to deliver improved public services as described by the minister and by colleagues including Michael McMahon. It will deliver the quality of services that the people of Scotland expect and deserve. I encourage members to support the motion.

We in the Conservative party want to see local democracy and local accountability flourish. We believe that greater responsibility should strengthen the institution of local government and make the role of councillor more attractive to a wider cross-section of society. Ultimately, that could only benefit constituents, who will reap the benefits of better-run councils and lower council tax rises as a result of more efficient administrations.

We all know from surgeries how many of our citizens feel badly let down by their local councils in terms of road and pavement maintenance, litter and refuse collection and other local services. Despite what Andy Kerr said, since Labour came to power seven years ago the average council tax bill in Scotland has risen by more than 42 per cent, which is more than double the cumulative inflation rate for the same period.

Will the member give way?

No. I may do so later.

As taxes have gone up, we have seen that service delivery is not better, but worse. Sylvia Jackson quoted COSLA in her speech, and in the process took a pop at Brian Monteith for talking about Stirling too much. That was a serious case of the pot calling the kettle black.

On road maintenance, COSLA has warned that in some cases roads that should be resurfaced every 10 to 20 years are now waiting an average of 81 years for treatment. The Executive appears to be operating not a tax-and-save policy, but a tax-and-waste policy.

As for Iain Smith and his Liberal Democrats, and their claim that a local income tax would be fairer, it will be interesting to see the final outcome of this arithmetical dual between ex-pupils of Portobello High School and Bell Baxter High School in Cupar. Having seen examples of Iain Smith's arithmetic in the past, my money is on Portobello High School.

Andy Kerr talked in glowing terms about the Executive's aspirations and initiatives.

Will the member give way?

No, I will not.

However, Mary Scanlon rightly drew attention to the apparent failure of certain councils to support statutes that are already in place, particularly in terms of backing up health and social work provisions. Despite Richard Baker's assertions about the level of funding for Aberdeen, I am reminded by my colleague Nanette Milne that Aberdeen City Council's children's services will be underfunded by up to £15 million next year, and its care services to the elderly will be undermined to the extent of £5 million. Nora Radcliffe, too, drew attention to that apparent disparity in allocating resources.

I am not calling for further ring fencing. I want to find out what sanctions, if any, the Parliament can impose if local authorities fail to support national standards or policy objectives. That is the point that Bristow Muldoon failed to understand.

On Gordon Brown's guilt rebate of £47 million—to which Brian Monteith's amendment refers—COSLA president Pat Watters said that nobody apart from Scottish local government has any right to the new moneys found by the Chancellor of the Exchequer. That is clearly not what Jack McConnell believes, and it is clearly not what Andy Kerr believes.

I have a certain amount of sympathy with Fergus Ewing's argument that the banding system appears to discriminate against householders in Scotland compared with those in England. However, by his own admission, he has no perfect solution to the problem of local taxation.

Will the member give way?

At long last I will let Mr Smith come in.

I cannot raise all the points that I would like to raise. However, as Ted Brocklebank reaches his final minute, will he tell us which of his colleagues he agrees with? Does he agree with Brian Monteith and his amendment, which states that there should be piecemeal relief to the council tax, or does he agree with, oh, Brian Monteith, who has said previously:

"Announcing additional funding for local authorities is a high risk strategy",

and went on to say,

"It is my view that offering piecemeal relief to the Council Tax will not be politically beneficial to us"?

Which Brian Monteith does Ted Brocklebank agree with?

I am not sure to which of his several questions Mr Smith would like me to respond. However, I believe Brian Monteith's arithmetic much more than I have ever believed Mr Smith's.

The Executive claims that there will be a 5.2 per cent increase in aggregate external finance for local councils in 2005, and a further 4.2 per cent increase in 2005-06, but members understand that AEF also includes grants in respect of expenditure on certain other services. COSLA argues, with some justification, that once the non-discretionary expenditure is removed from the Executive funding, the true year-in-year-out funding increase is only 2.5 per cent, as opposed to the Executive's claims of 5.2 per cent and 4.2 per cent.

Will the member give way?

No, I am in my final minute.

I have sympathy with Andrew Welsh's view that increased ring fencing by the Executive results in the local delivery of central services, not local government. It leaves councils with only one role, and that is to choose which cuts they will make in order to deliver the Executive's centrally imposed priorities. Is it any wonder that it is difficult to attract people of any calibre to stand for local councils? I support Brian Monteith's amendment.

Perhaps Mr Kerr will take on board a suggestion from COSLA, which has also been made elsewhere, that when the Executive presents its figures each year it should identify clearly what the new burdens and new initiatives are and produce the figures independently, rather than try to aggregate them all. That would be helpful to the overall debate.

The figures to which Mr Adam refers are available. I have always said that funding for local government is challenging but fair. I have never trumpeted, as a member suggested earlier, the increases in funding to local government.

I am glad that the minister has made the figures available, but it might be helpful if he were to present them in the way that was suggested. Every year we have a debate on local government finance and for a long time we have had the situation in which COSLA and local authorities say one thing and the Executive says another. Presenting the figures in the way in which they are presented at the moment is not helpful.

I found Bristow Muldoon's speech interesting. He described the difference between Sweden on the one hand and Ireland on the other. It is not the difference between those countries that is important, but what they have in common. They both have a gross domestic product that is greater than Scotland's and indeed the UK's—

Will the member give way?

No thank you. Let me finish the point.

Sweden and Ireland are both independent and they have both made their own choices about how they will raise their taxes and how they will deliver their services. Ireland has made the choice that it will not have local tax; the Government has listened to the people's demands. We have difficulties in Scotland because we are not responding to people's demands.

Will the member give way?

I might come back to Mr Muldoon when I have developed my points.

The points about the situation in Aberdeenshire Council that Nora Radcliffe raised in this debate and which Mike Rumbles raised in a previous debate are well made. There is no doubt that there are councils that have not fared well in this settlement and, indeed, in recent settlements. I endorse what Nora Radcliffe and Mike Rumbles said.

I found it rather more difficult to accept what Mr Smith said about the situation for Aberdeen City Council. I have a letter, to which other members have referred, from the Liberal Democrat leader of Aberdeen City Council, which states:

"It is not acceptable that the people of Aberdeen … should struggle year after year to deliver services often to standards set by … Central Government against a background of … under-funding."

It seems evident that the funding for Aberdeen and other areas has been allowed to fall to levels that are simply not sufficient to deliver a minimum service. Elsewhere, the leader of the council mentions seven successive years of cuts. That is not compatible with what Mr Smith said earlier. Aberdeen City Council gets even less funding from central resources per head of population than does Aberdeenshire Council. Ministers might wish to consider certain areas in particular.

Ted Brocklebank referred to the problems with regard to children's services in social work. We need an interim solution to that difficulty. I know that there are children's homes in Aberdeen that require £2 million to be spent on them in the near future. We have significant shortages in social work staff, although I accept that they are not all to do with the budget, as some departments find it difficult to recruit staff. Perhaps the ministers might wish in the near future to meet and have detailed discussions with representatives of Aberdeen City Council in the same way that they had the courtesy to visit representatives of Aberdeenshire Council. I would welcome the minister's response to that point when he winds up.

I could highlight other issues, such as the fact that we have a successful concessionary fares scheme in Aberdeen, but the grant that was supposed to cover that scheme is approximately £1.5 million short, because the service is being used. That is not because Aberdeen has a generous service—in fact, many of those who are in receipt of the service in Aberdeen contrast it unfavourably with what is available elsewhere.

Mr Adam has not yet referred to the amendment and I would be interested to know, before he finishes his speech, the position of the member and his party in relation to the Barnett consequentials and how they might vote on the amendment.

Our position on the Barnett consequentials is well known and I am sure that Mr Monteith was in no ignorance of it when he rose to make that point. He will find out where we stand in relation to his amendment very shortly, at decision time.

The reserves that Aberdeen City Council has been able to use relatively wisely in the past are no longer available and cannot be used as a buffer during the changes from year to year. We need to have a close look at the distribution formula, which is not as clear as it might be. I wholly endorse the weighting that is given to deal with deprivation, but the onus is on the Scottish Executive to ensure that we are getting positive outcomes as a result of that investment. I am not convinced that we are working in a cross-cutting way to deliver in that regard or that we have in place adequate monitoring arrangements. If we are to try to make changes to the areas that are in difficulty, we need to know that we are getting value for money.

In many ways, this debate has been utterly extraordinary. The fact is that the level of resources that are available to Scottish local authorities has never been higher. However, anyone listening to the speeches from the Opposition benches would never have known that. Some £2.5 billion more will go into local government coffers in 2004-05 than was the case in 1995-96. The Scottish Executive and the members on the partnership benches are proud of that extra investment in our local government services and local authorities. I find it extraordinary that so much whingeing has come from Opposition benches, given that we have introduced three-year budgeting and real increases in resources and have worked constructively with COSLA for the right length of time to agree where the burdens are and where the extra resources need to be allocated. To attack what we have done in that context is, as I said, extraordinary.

Will the minister give way?

In a moment.

It says a lot about the Opposition—and this was epitomised by Mr Adam's speech—that no Opposition member spoke about the level of resources that are available to local authorities, the allocations that have been made to individual councils or the way in which local government and central Government work together; on the whole, they chose instead to talk about the council tax.

However, when Mr Kerr asked Mr Ewing—and, by extension, the other members of the SNP front bench—what his position was in terms of an alternative policy rather than a principle, there was no answer. I am advised that the SNP manifesto for the 2003 election said, of the subject that Mr Ewing described as the burning issue, that the SNP would

"replace the council tax with a fairer system based on the ability to pay".

There is a big difference between a broad principle and a policy, especially when the SNP has made such an important point of the council tax during the past year and in this debate.

The fact is that the level of resources that are available to Scottish local authorities has never been higher. All councils have been given a real-terms increase in their revenue grant allocation in 2004-05 and all new initiatives—I stress this point, as many members touched on it—have been fully funded. I hope that Mr Adam will accept that.

I do not accept that they have been fully funded and neither does Aberdeen City Council. The minister complains that the members of the Opposition are whingeing and moaning, but all that I was doing was pointing out what the leader of the Liberal Democrats in Aberdeen City Council had said. Indeed, Liberal Democrat-led Aberdeenshire Council has made the same point, so the minister's complaints relate to his colleagues in local government.

Where burdens have been agreed with COSLA, we have fully funded those commitments. Mr Adam should accept that point or not, as the case may be.

The SNP is missing the point entirely. It is not that no money has been spent; as the minister has pointed out, local government has been allocated more money than ever before. However, any future review must examine the distribution formula and how the council tax is raised and spent.

As Mr Rumbles knows, there have been a number of reviews on distribution. COSLA and the Scottish Executive are actively considering all those matters in relation to the forthcoming review of local government finance.

The order will support a better quality of life for people throughout Scotland, no matter whether they live on the mainland or on the islands or in urban or rural areas.

I want to pick up some specific points that members have raised in the debate. For example, on Sylvia Jackson's point about economies of scale, I assure her that COSLA is actively considering the issue. We accept that it is important and will do further work on it.

Michael McMahon gave a practical illustration of what the moneys can do. His speech was a welcome change from many of the speeches from Opposition members, who had nothing to say about the real differences that the resources are making for local government and—more important—for citizens across Scotland.

Given Andrew Welsh's experience at Westminster, when he sat through many years of Tory cuts, I would have expected him to acknowledge the changes that the Executive has made, such as moving from a one-year to a three-year settlement and working very much in the long term. The only point that he might wish to consider further is his party's opposition to PPP, which is one of the mechanisms that allows for long-term investment in, for example, schools.

I believe that there are other and better methods of funding.

On another factual matter, will the minister clarify when the grant levels for the supporting people initiative will be announced?

Margaret Curran has direct ministerial responsibility for that matter. However, we will ensure that Mr Welsh receives a reply to his question.

Mr Brocklebank raised the issue of ring fencing. I trust that he accepts that 8.5 per cent of the total revenue support grant is accorded to ring fencing. I should also point out that 75 per cent of that figure is for the police, which I thought was a matter in which his party usually took some interest.

Moreover, I could not quite square Mr Brocklebank's speech with the points that were made by Mary Scanlon, who seemed to be arguing for more centralisation and ring fencing as far as burdens are concerned.

Will the minister give way?

No. Mary Scanlon should let me answer her point. After all, I am trying to answer the points that members have raised in the debate.

I hope that Mary Scanlon has taken up with the appropriate minister the detailed cases that she highlighted in her speech, because I am sure that she will receive a full reply. However, I repeat that the burdens on local government in relation to some of the issues that she raised are subject to an agreement with COSLA. I hope that she will examine that funding issue.

I also remind Mary Scanlon and others on the Conservative benches—

Will the minister give way?

No.

I remind them that it was the Tories in the Highlands who ensured that the revenue budget for road maintenance—which was another issue that Mr Brocklebank raised—was cut from £28 million to £14 million in the past year. As a result, we will not take too many lectures from those members on the subject of those particular burdens.

I want to help in the debate on arithmetic that members across the chamber have had. Will the minister confirm which party was in Government in February 1997 when the 1997-98 local government settlement and council tax levels were set?

I was just about to mention the party in question, because it is important that I deal with Mr Monteith's amendment. As I take his point that he has at least lodged an amendment to the motion, I should set out the reasons why the Executive does not accept it.

Given the figures that the Conservatives bandy about, we should acknowledge that—as Iain Smith pointed out—the average council tax was £556 when it was introduced in Scotland by the Conservatives. By the time that they left national office four years later—a day that many of us still celebrate—the tax had increased by more than 40 per cent. In contrast, because the Scottish Executive has provided more support to local government, the tax has increased by only 18.9 per cent over the comparable period. That illustrates a very clear difference between the Executive and the Conservatives.

Will the minister give way?

No, I am just about to conclude.

The other reason why Mr Monteith's amendment should not command any support today is the inconsistency of his position. In the issue strategy paper that he brought out last summer—a document that we all hold on to with great interest—he declared that announcing additional funding for local authorities, instead of allocating money to cut council tax, is a high-risk strategy. He said:

"It is my view that offering piecemeal relief to the council tax will not be politically beneficial to us."

Quite what he is on about today is beyond me.

The Local Government Finance (Scotland) Order 2004 asks Parliament to confirm the revenue grant support for each council for the coming year. It will enable councils to confirm their budgets and council tax figures. I believe that the allocations in the order should allow councils to stick at, or below, the indicative council tax increases that they have already published. The order will deliver a fair deal to council tax payers and I commend it to the Parliament.