Local Government Finance (Scotland) Amendment Order 2008
The next item of business is a debate on motion S3M-1631, in the name of John Swinney, on the Local Government Finance (Scotland) Amendment Order 2008.
On 7 February, Parliament approved the Local Government Finance (Scotland) Order 2008. The order agreed the core revenue funding to councils for the coming financial year, 2008-09. In February, we said that we would allocate a further £70 million to support councils that froze their council tax rates for 2008-09. I am pleased to advise Parliament that all 32 councils have now done so. Indeed, one council—Stirling Council—has cut its council tax rate. If a council is able to cut its council tax rate, that is surely positive proof that this Government has put in place adequate resources to support local services in our communities.
Will the cabinet secretary please tell us how many single outcome agreements are in order and in place?
Mr Brown will know that the Government has stated clearly that single outcome agreements are being developed with local authorities. We expect the drafts to be with the Government in the next few days. The discussion between the Government and local authorities will continue over the next few weeks—as I have confirmed in previous comments to Parliament—to ensure that the single outcome agreements are formally agreed by the summer recess.
The single outcome agreements represent a change in the whole way in which we manage our relationship with local authorities. The outcomes are a welcome development in how the Government's relationship with local authorities is structured, which will be to the benefit of our citizens.
The motion before Parliament today seeks agreement to an amendment to the earlier order, to allocate the extra £70 million to local authorities for 2008-09 in recognition of the decision of the 32 local authorities on council tax. It is a formidable achievement that, no matter their political colour, councils across Scotland have unanimously embraced the support offered by the Scottish Government to make life a great deal easier for their constituents.
The minister refers to making life easier. What advice would he give to those members of staff of Highland Council who are losing their jobs as a consequence of the council tax freeze?
At various stages over the years of the Administration of which Mr Peacock was a part, there were changes to employment in local authorities as a result of decisions that local authorities took. This Administration has put in place the resources that guarantee that local authorities can freeze the council tax and invest in local services. There are countless examples around the country of local authorities investing in public services to ensure that they deliver for their communities.
Mr Peacock asked what advice the minister would give to the staff at Highland Council. In the same vein, what advice would the minister give to the staff of the voluntary sector agencies in Aberdeen City Council area who are losing their jobs as a consequence of changes made by the council in the light of the settlement?
I reiterate the point that I made to Mr Peacock. Local authorities make their own decisions about how they allocate their resources, which is perhaps one of the reasons why Aberdeen City Council is facing the difficulties that Mr Macdonald raises. There is evidence of that in a recent report from the Accounts Commission, which makes serious reading for us all. It says that the council's financial position is precarious. Over the past four years, the council has been using reserves to the tune of £7 million, £8.8 million, £10.9 million and £12.2 million. That is a difficult financial situation for the council to manage, and it must address the issues that the Accounts Commission has raised, which is what it is now doing.
The order will distribute an extra £70 million in revenue funding, on top of the £9.2 billion in general revenue grant already approved by Parliament. Under the previous Administration, the share of funding that went to local government as a proportion of the Scottish budget steadily declined. This Government is investing record levels of funding in local government, and we have halted that decline in the share of spending that is allocated to local government. Thankfully, the Scottish National Party Government has started to reverse the vicious trend of reducing local government's share of the budget—a trend presided over by the previous Administration. We have increased funding to local government by 5 per cent for 2008-09. In the next three years, there will be an overall increase of 13.1 per cent. The £70 million for which we seek approval today equates to a 3.2 per cent increase in council tax income in every single council area—a level of financial support that is more than is required to fund a freeze in the council tax. We have delivered a fair and realistic settlement to the communities of Scotland.
Local authorities have been able to take their own decisions on their priorities in the budget as a result of an unprecedented level of freedom and flexibility provided by this Government. We have put power back into the hands of local authorities and we have provided more than adequate financial support to enable councils to deliver their priorities. We have given councils that increased flexibility by removing large elements of bureaucratic ring fencing of funds, and we have agreed with them on a move away from a focus on inputs and process to a focus on outcomes and what is actually achieved. By allowing local authorities for the first time to retain efficiency savings, we are incentivising local authorities to seek meaningful efficiencies in order to release as many resources as possible to boost front-line services.
Many members said that a council tax freeze could not be delivered. They have been proved wrong. The assistance that we have put in place will come at a very welcome time for householders in Scotland. As a result of this Government's action—working closely with our local authorities—householders who are wrestling with increased fuel and food bills are spared an increase in the council tax. That is the type of positive, beneficial impact on the finances of households in Scotland that the Government seeks in the decisions that it takes and will continue to take, putting the needs of the people at the centre of our priorities. The council tax freeze will provide relief to households throughout Scotland—more than three quarters of households in Scotland will see their income increase over the next year as a result of the freeze. The average household in the bottom 10 per cent of income distribution will, in relative terms, gain most of all.
Earlier this month, we launched a consultation on our proposals to abolish the council tax and replace it with a fairer local income tax based on the ability to pay. We will listen carefully to the results of that consultation.
We recognise that the distribution formula we inherited is overly complex. The current system has developed in a fashion like Topsy. Along with local authorities, the Government is considering simplification of the formula to ensure that we have a reliable and robust basis upon which to distribute resources.
I invite Parliament to support the motion in my name, to put in place the resources to guarantee that our local authorities are able to deliver the freeze in council tax that the Government promised and that we are pleased to deliver.
I move,
That the Parliament agrees that the Local Government Finance (Scotland) Amendment Order 2008 be approved.
The Liberal Democrat amendment asks that Parliament should not just pass the Local Government Finance (Scotland) Amendment Order 2008 but reflect on its consequences. I want to make three points: on the state of the public finances; on the impact of the settlement on local government throughout Scotland; and on the nature of local democracy.
The state of the public finances must be of concern to any finance minister. A prudent approach to the public finances would be to accept how interdependent the Scottish economy is on the economies of England and Europe and wider world influences. Tax returns, the credit squeeze and business failure can and will affect the United Kingdom economy. The windfall from higher oil tax revenues will not offset those financial challenges, so Scotland's financial cake has the potential to be slimmer, in real terms, over this session of Parliament.
The politics of girn do not wash. Alistair Darling's much-criticised growth targets in the recent budget look at best ambitious, and perhaps foolish. If public spending is predicated on growth targets, and taxation income projections are not realised, the repercussions for Scottish public expenditure could be severe.
It is surely against that background that Parliament is debating—and will pass—the order. However, it is that background that suggests that financial decisions, and populist measures with a view to short-term political gain and not the long-term future of the country, must be assessed.
Inflation is back in the political lexicon. Price increases are real: in food, energy costs and household living. The governor of the Bank of England said last month that it was "more likely than not" that he would be writing a second letter to the Chancellor of the Exchequer to tell him that he had missed the inflation target. Before its members start jumping up and down, the SNP would keep an independent Bank of England prior to joining the euro, so there is no monetary policy difference between Mr Salmond and Mr Brown. So much for the myth of economic independence.
Yes, the Scottish economy looks resilient against the international financial pressures that apply now, but experience suggests a lag before the global impact bites here. A prudent approach to the public finances is imperative. The budget decisions taken by this Government have not been about the long term. As we have heard before, this Government is a disciple of the Clinton and Blair playbook—every decision is about 2011. The order is part of that.
However, the impact of the order on local services is profound. The council tax freeze was a policy no local council could turn down, but the consequence is that many local people—who depend on local services—are being turned down. The Liberal Democrats asked the Government to guarantee that local services would not be cut as a result of the SNP's budget decisions. We asked that question consistently throughout the budget process and never received an answer. We now know why.
There is a scale of cuts—even in Glasgow. I noticed in the papers this week that Glasgow is cutting 425 posts, 124 of which are teaching posts. However, I agree with the cabinet secretary that the political colour of the Administration does not matter. Throughout the country, under every party represented in the Parliament, jobs and services are being cut. That is not my construction but that of council chiefs throughout the country.
The "historic"—as everything is these days—settlement cannot be all that the Government cracks it up to be. If it were so good—so historically good—why are so many jobs being shed, and why are so many councils having to consider cutting services? It might be a more worthy target of the slightly intemperate word that Mr Swinney used earlier. The impact is severe, and it will be more so in the next two financial years. The Convention of Scottish Local Authorities, local authority finance chiefs and independent commentators all state that the settlement to come is eye-wateringly tight. Given the background of the public finances and the need for the Government to find resources to meet a council tax freeze for the rest of this session, what is happening now across Scotland will become more pronounced in the years to come.
My final point is on local accountability. We should be clear that no council now has any control over the income side of its balance sheet. The argument that applies to the Parliament—which some of us strongly wish to change—now applies equally to the 32 Scottish local authorities, and no change is in sight. The Labour Party and the Conservatives oppose getting rid of the council tax and the SNP Government wants a national income tax. Unfortunately, the parliamentary arithmetic means paralysis and no change.
For those reasons, the Parliament should not only agree to the order but reflect on its consequences and consider the future that lies rather further ahead than 2011.
I move amendment S3M-1631.1, to insert at end:
"but, in so doing, regrets the extent of public service cuts and closures in communities across Scotland as a direct consequence of the financial settlement received by local government from central government."
It will seem ironic to many communities throughout Scotland that the Cabinet Secretary for Finance and Sustainable Growth is parading the glory of the council tax freeze as they experience many cuts in public services. People with disabilities are paying more for care, while council rent increases are higher than inflation. Union leaders are demanding meetings to fight compulsory redundancy. Pensioners are being told that their concessions for adult education classes are over. Pools and sports centres face the axe and parking charges are rising. Schools are strapped for cash, teaching posts are being cut and school cleaning budgets are being slashed. There are increases in school dinner charges, music tuition fees, ferry fares, commercial refuse collection fees and even burial charges. That is all because of Mr Swinney's budget.
Throughout Scotland, councils are cutting their baselines to balance their budgets. East Lothian Council is cutting its baseline by nearly £4.5 million, Fife Council has cut the baseline by £12.5 million and Highland Council has cut its baseline by nearly £13 million. All those cuts have been made to balance the budgets and it is all because of Mr Swinney's budget. The headlines are reminiscent of the Thatcher days, when councils cut services, did not fill vacancies and laid off staff to charge the poor more. What an achievement that is for Mr Swinney, who figures in many of the headlines.
In Aberdeen, the cuts are particularly bad. They mean that the homeless will be colder in the streets, schools will be closed and swimming pools and leisure centres will be axed. In Edinburgh, there have been cuts in the sure start scheme, school budgets and nursery places, while five new school buildings have been put on hold. As Wendy Alexander has said, Alex Salmond is fast becoming Scotland's Mr Takeaway.
Will Andy Kerr tell us whether he supports the council tax freeze—yes or no?
I have said in the Parliament on many occasions that I support it if it is properly funded, but not if it is funded by robbing the money from council budgets and starving communities throughout Scotland—including Mr Adam's own—of much-needed services. Those communities are now paying the cost of the council tax freeze. That is the difference between Mr Adam and me: I see the issue as being not about new money going into the system to add to services, but about money being taken out to balance budgets. That is the real effect of the SNP's budget.
Let us look at the facts. Councils throughout Scotland have received the tightest settlement since devolution. It is a 1.5 per cent increase in the money that is available to be invested in public services. The SNP has funded inflation and the council tax freeze but, when it comes to funding services, its budget settlement has failed the people of Scotland miserably.
Much has been said about the funding that was available for local government services when the Labour Party was in power. Under Labour, the average annual increase was 5 per cent in real terms, not 1.5 per cent as it is under the SNP.
Mr Swinney wanted that point made; I will give way in a minute.
Over the period that Labour was in power, council tax increases were held at less than 2 per cent, and the Scottish band D level fell below that in England.
What was the scale of the increase in the Scottish Government's budget when Mr Kerr was the Minister for Finance and Public Services? It was formidably greater than any increase with which I have had to deal.
Therein lies the myth of the concordat con. The share of the Scottish budget that went to local government under Labour was 35.5 per cent on average; under the SNP, it is 33.59 per cent. The share of the Scottish budget spent on local government was much larger under Labour than it is under the SNP, but the minister fails to recognise that. Perhaps we will come back to some of those points in the closing speeches.
At the heart of Scottish local government, the SNP has left a black hole for public services, the disabled community and the elderly in Scotland. It has left those who rely on public services in dire need of more resources and it has failed to deliver.
The Conservatives will support the motion because we welcome the council tax freeze and the relief that it brings to hard-pressed taxpayers. Indeed, as the cabinet secretary said, Stirling Council even cut council tax—Michael Forsyth would be proud.
I will focus on the Liberal Democrat amendment. Tavish Scott gave a reasoned and thoughtful speech—it was most unlike him—but I will come to the detail of it. The amendment calls for a higher allocation of funds to local government. It is a perfectly reasonable thing to argue for and is unsurprising, because spending more of other people's money is the Liberal Democrats' favourite solution to whatever problem confronts them. If the local government settlement is so meagre, is it not a pity that they did not try to secure extra money for it in the budget process?
I am surprised at Derek Brownlee's line of questioning because, only on Monday, his leader was describing Mr Swinney's colleagues as socialists. If they are so socialist, why did the Conservatives vote for their budget?
That was not an answer to my question about where the Liberal Democrats' attempts to amend the budget were. If Mr Scott looks at annex A to the Finance Committee report on the budget, which helpfully lists all the alternative spending proposals, he will not find a single one from the Liberal Democrats. Today, they cast themselves as the friends and saviours of Scottish local government, which might strike residents of Edinburgh and Aberdeen as ironic. What did those friends of local government do when they were confronted with a series of amendments to the budget in January, all of which aimed to reduce the local government settlement? They looked long and hard at them and then, given how poorly dealt with they considered local government to be, summoned up all their principles and—as only the Liberal Democrats can—abstained on 10 separate occasions. Nick Huhne would be proud of them.
Having failed to even try to get additional funding for local government in the budget, the Liberal Democrats are at it today. And why not? Why should local government be denied the additional spending that the Lib Dems demand for everything else? They are as happy as pigs in mud when demanding that taxpayers' money be spent on their issue of the day—which is apt because, on three occasions since the budget, they have demanded extra money for pigs.
Mr Scott gave an eloquent description of the state of the public finances.
Is Derek Brownlee ridiculing the fact that the pig industry is in a dreadful state? The Conservatives should support that industry, not denigrate it.
I am ridiculing a speech from Mr Scott about the state of the public finances and a series of spending commitments from the Liberal Democrats. Ross Finnie demanded more money for the national health service on 8 February. Alison McInnes wanted it for regional transport partnerships and lain Smith wanted it for bus fares also on 8 February, while on 14 February Alison Mclnnes wanted more money for bus operators. On 14 February, local government was to get more money according to Nicol Stephen. On 20 February, Alison Mclnnes wanted it for a hovercraft and Hugh O'Donnell wanted it for a phone line. On 21 February, Mr O'Donnell also wanted money for international aid.
On a point of order, Presiding Officer. I spoke to the Government's proposals, but Derek Brownlee is making a speech on behalf of the Government. Would you draw him back to the debate that we are having?
If he had been out of order, I would have stopped him.
I had only got to 21 February. On 22 February, Mr McArthur wanted money for fuel poverty. On 27 February, Mr Scott wanted it for ferries and Mr Tolson wanted it for sports facilities, while, on 28 February, it was being asked for for enterprise training for teachers. On 6 March, Jeremy Purvis wanted it for education and, on the same day, the borders railway. Mr Rumbles asked for it for rural development on 7 March. A national migrant study was the target for Mr McArthur on 8 March and for Alison Mclnnes it was the A82 on 11 March. Ross Finnie wanted money for community health care on the same day but, the day after, John Farquhar Munro wanted it for post offices. It was coastguards' pay on 13 March. Mr Rumbles wanted money for pigs on 18 March. On 20 March, Jim Hume wanted it for biomass and Mr O'Donnell wanted it for school estates. I worried that a week was about to pass without another Lib Dem spending commitment but, yesterday, Mr Scott saved the day with his demand for more funding for local government.
The Liberal Democrats' reasoned amendment is an attempt to blame central Government for all the problems in local government. It will not wash. Let us dismiss it as the smokescreen that it is and welcome the freeze in council tax and the ending of ring fencing for local government.
We will support the motion in John Swinney's name and take particular pleasure in voting down the amendment in the name of Tavish Scott.
It is a great pleasure to speak in support of Mr Swinney and the additional £70 million that we are debating. I am delighted that Aberdeen City Council is to receive £3.3 million of the £70 million, which will go across the board in Scotland, because all the councils have frozen council tax, with the exception of Stirling Council, which has cut it.
As Mr Swinney rightly pointed out, there are issues with local government funding, and I am delighted to hear him repeat today that he will examine the rather overcomplicated current formula, which does not bear detailed scrutiny and is difficult to justify.
Will the member give way?
Let me develop the point.
I look forward to those plans coming to fruition.
The reason why we currently have so many difficulties in Aberdeen is the continued overspending of the previous two Administrations. The first figure that Mr Swinney gave—the £7 million—was money that Labour spent over the budget, which created a long-term commitment for the council. The other figures were—
Will the member give way?
Will the member give way?
I will not take interventions—let me develop the point.
We cannot take a view on the independent Accounts Commission having rightly identified the financial position in Aberdeen as being precarious without closely examining the spending patterns over the past few years.
Will the member give way?
If the member had any idea how finance worked, I might think about taking his intervention, but since neither he nor his colleagues, nor any of the Labour councillors in Aberdeen, have offered any alternative budget, there is little point in hearing what he has to say.
The spending over the past four or five years by Aberdeen City Council of almost £40 million of reserves as revenue funding—money that was not there—is precisely why the Accounts Commission has reported that the council is in a precarious financial position.
Under the auspices of Labour-Liberal Democrat Governments, Aberdeen had a 90 per cent council tax rise, when the Scottish average was 62 per cent, which was bad enough. That is why—
Will the member take an intervention?
I am terribly—[Interruption.]
Order.
I am terribly disappointed that Labour members are not prepared to accept the facts.
Will the member agree—[Interruption.]
Order.
Does the member agree, as Mr Swinney has failed to do, that council tax levels in the first year of the Scottish Parliament were set by the previous Tory Government and so were not Labour's responsibility? Therefore, the member's figures are plain wrong.
Even if we discount that, the rise in council tax was considerably higher than the rate of inflation, and it was disproportionately higher in Aberdeen as a result of the funding formula, which the Labour Administration was repeatedly asked to change and did not. It is to Mr Swinney's great credit that, having taken office during a very difficult financial period, he is prepared to address such situations in conjunction with the Convention of Scottish Local Authorities.
The overall generous settlement that we now have highlights the fact that the proportion of the Scottish budget that was going to local government had been in steady decline. When Labour left office, it was as low as 28.9 per cent, which emphasises Mr Swinney's point about the 35 per cent average that was claimed by a Labour spokesperson. At the end of this spending review period, it will be up at 33.6 per cent.
We have a sensible proposal to distribute the money that people want to go to local government that will help to maintain council tax freezes in the coming year. I look forward to two more years of that, by agreement with the local authorities.
We keep being told that the local government funding settlement is historic. It is certainly historic in Aberdeen—it has resulted in swingeing cuts to key services and facilities, the likes of which have never been seen in the city before. Mr Adam fails to recognise that when Labour left office there was a surplus of some £23 million—now we have £27 million of cuts, which will hit older and vulnerable groups in particular, as well as services for people with disabilities. At a time when we are trying to encourage people to lead healthier lives, sports centres are being closed—a move that has caused particular dismay among the city's young people.
In light of the information that I gave Mr Macdonald about the use of reserves by Aberdeen City Council over the past four financial years, and bearing in mind the Accounts Commission's report that says that the financial position of the council is precarious, what steps would Mr Baker recommend the council takes to rectify its financial position?
None of those decisions was made under a Labour Administration. Indeed, several suggestions for alternative funding decisions have been put forward locally, which certainly do not include spending around £80 million on new office accommodation for the council administration.
This budget is the most right wing that the Parliament has ever seen. The cuts in Aberdeen, which will affect children, young people and people with disabilities, are—I tell Mr Adam and his colleagues—no laughing matter.
Those of us in the Parliament who said that the settlement would hit the vulnerable were told that we were scaremongering and asked how we dared to suggest that councillors from other parties would make budgetary decisions that would remove lifeline services for people with disabilities. Well, in Aberdeen, the SNP colleagues of ministers are, as members of the council administration, making exactly those decisions.
Last Friday, my parliamentary colleagues and I, along with affected groups, held a meeting that was attended by more than 400 people to highlight the concerns about the impact of the cuts. The leaders of Aberdeen City Council were invited, but they did not attend to hear those concerns. It was heart-rending to hear the fears of some of the people at the meeting about how devastating the cuts would be for them. The sporting hopes of young swimmers and skaters who do not know where they will be able to train have been dashed and we heard about the plight of disabled people who will lose jobs at Glencraft and the facilities at the Choices centre, which has given real meaning and direction to the lives of many people with disabilities, some of whom cannot imagine life without it.
Will the member give way?
I am sorry, Mr Brown—I do not have time.
I cannot believe that if the SNP councillors had been there, they would not, at the very least, have thought again about the impact of their budget. Of course, local decisions are crucial, and the cuts do follow mismanagement of council finances by those with responsibility for such matters, both in the current and the previous administration, since 2003—failings that the Accounts Commission has highlighted, as the cabinet secretary said. However, those failings have undoubtedly been compounded by the national funding settlement. Not only is Aberdeen at the bottom of the national funding table but, as Mr Brown said, we still do not know what services we can expect to be delivered locally through a single outcome agreement.
What does the member make—and what will the voters of Aberdeen make—of Brian Adam's comment that the Government's financial settlement to the city of Aberdeen this year was generous?
I think that the voters will judge that the settlement was poor indeed, Mr Rumbles. We need to know what kind of provision will be made under a local single outcome agreement and whether services such as those for people with disabilities will be protected in future. Before the election, the SNP promised good times for the north-east, but Aberdeenshire—not only Aberdeen—has received a poor funding settlement. Any benefit to poorer families and older people from the council tax freeze has in our part of Scotland been more than offset by increased charges.
Those charges are compounding the impact of the swingeing cuts in the city of Aberdeen. Even under the Conservative Government and Michael Forsyth, Aberdeen never experienced cuts such as it is suffering now. Everything must be done to ensure that the cuts do not go ahead. I realise that opposing the order today will not change the position, but I urge ministers to do all that they can to mitigate the cuts, which are due for April 1—a poor joke on the vulnerable in our city. If the cuts proceed, there is no doubt that Aberdeen will have been shamed by its own council administration, and that the north-east will have been badly let down by the SNP.
As a former councillor, I am delighted to take part in the debate on the local government finance order—which we awaited each year with some dread under the previous Administration. When I was a councillor and council leader, I always wanted to say three things, as did council leaders across the political spectrum. First, to the dismay of local government, the share of the cake was reduced over many years; that point has been made today. Along with other Convention of Scottish Local Authorities leaders, I made these points to the then finance minister back in 2002, and our concerns were dismissed as irrelevant.
Will the member give way?
No. I have just started.
Secondly, I wanted to say that we should end or at least reduce ring fencing. It is evident that people throughout local government are happy that ring fencing has been hugely reduced this year. The third thing was that the Labour Government—and previously the Conservative Government—should stop using the council tax as their form of taxation. They taxed people without taking the odium for doing so by reducing the share of the cake that local government received and forcing huge increases because of the gearing effect.
On that point, will the member give way?
Certainly.
The table that has been made available to us by the Scottish Parliament information centre shows that, in the year that the member mentions, 2002-03, local government's share of the Scottish budget was 36.66 per cent, and that in 2008-09 it will be 33.57 per cent. That is a drop of more than 3 per cent. Can the member explain that?
I do not recognise those figures, and the council leaders at the time—Labour or otherwise—do not recognise them either. The simple fact, which the member refuses to acknowledge, is that Labour reduced local government's share, year on year, in every year for which it was in office.
We are here to debate whether to pass extra money to councils to enable them to freeze their council tax. I did not expect Labour or Liberal Democrat members to oppose the freezing of the council tax and they have not disappointed me. Instead, however, we have heard talk of cuts, cuts and more cuts. In politics, there are debating tricks, and everyone has the right to present their case in the best possible light, but there are times when that verges on—or even crosses into—being downright deceitful with the public.
What we have heard is deceitful because the funding that councils have received from the Scottish Government is generous, and more than the previous Administration gave them last year. That is a simple statement of fact. For example, in the next three years, funding for Clackmannanshire Council and Stirling Council, in my constituency, will increase by 15.4 per cent and 14.4 per cent respectively. Both are Labour administrations—or at least they were until two weeks ago, when Labour was thrown out of office in Stirling and the SNP took control of the council.
The Labour administration in Clackmannanshire has done its party duty and complained at every opportunity about what it calls the cost of the council tax freeze, but we should remember that it goes through bad Audit Scotland reports faster than Wendy Alexander goes through press officers. The administration has presided over financial mismanagement on such a scale that its cash reserves fell to just £6,000 a few months ago. Now, somehow, despite the council tax freeze, it projects the reserves going back up to £3 million.
Strangely, though, despite all the extra money that it is getting from the Scottish Government, the Labour administration in Clackmannanshire proposes spending cuts and efficiency savings that are twice what the SNP opposition proposed. So much for Wendy Alexander and her famous declaration on January 13:
"I have no doubt that Labour councillors, indeed Labour councils, have spent their life looking after the homeless, women's aid, all of these poor, weak, vulnerable groups that we came into politics for."
In Clackmannanshire, the Labour group is cutting school crossing patrols and classroom assistants. Those cuts could have been easily avoided if it had accepted the SNP's alternative. The simple fact is that the council is seeking to increase its reserves to £3 million at the same time as making cuts. It had alternatives to that.
If a Labour council can do no wrong, how come a council—let us say, for example, Stirling Council—has managed to reduce its council tax? How can the council tax freeze possibly be hurting services to those poor, weak, vulnerable groups? Like a grumbling Labour back bencher, it does not follow. Either the forcibly retired Labour administration in Stirling was a bunch of chancers, or the £70 million that is attached to the council tax freeze means that there is no damage to those services, in which case the members of the Labour group in the Scottish Parliament are the ones who are being less than truthful about these things. When I consider those two possibilities, I wonder whether both the Labour administration in Stirling and the Labour Opposition in the Parliament are merely scaremongering, as they have been doing for a number of months now.
The word on the ground is that Stirling Council's dear, departed Labour administration knew that the funding settlement was a gift given by a Scottish Government that could not really afford to be generous. According to a Scottish Executive survey three years ago, a third of the population has no meaningful understanding of what a percentage is. I clarify that that was a survey by the Scottish Executive and not a survey of the Scottish Executive. One does not have to be John Swinney to know that, when the Scottish Government's budget increases by 0.5 per cent but its funding to councils increases by 2 per cent, councils are getting an extremely good deal. For that reason, I am happy to support the motion and the council tax freeze.
As Richard Baker said a few moments ago, a new era for local services has begun in the city of Aberdeen. The danger is that what is true of Aberdeen today will be true of the rest of Scotland tomorrow.
Today, in Aberdeen, supporters of the homelessness charity the Cyrenians are beginning a week-long action of sleeping out in the shadow of Marischal college. Usually, its supporters take part in sleep-outs to raise the public's awareness of the problem of homelessness in Aberdeen. This time, they are braving the elements to protest against local government cuts. The Cyrenians alone face a cut of £900,000 from the annual funding that they receive from Aberdeen City Council. They expect that four valuable projects that work with homeless people will close, and that 30 voluntary sector jobs will be lost.
Does the member support the council tax freeze in Aberdeen or does he believe that the £27 million shortfall should be made up by a £356 rise in the council tax?
Is that not a peculiar question from a member from Dundee? Let us see whether we can engage in some dialogue with SNP members from Aberdeen. It would help if members, in making speeches and outrageous claims about the city of Aberdeen, engaged in debate rather than refusing interventions.
In practice, the new-found freedom of local government has meant £27 million of cuts across the board in the city of Aberdeen and the seeking of a further £2 million of savings from proposed school closures. SNP ministers say that councils can now set their own priorities, decide where money should be spent, make local decisions to meet local needs, and be accountable to local people. It is a shame, then, that SNP councillors in Aberdeen have not explained their priorities to local people, have made decisions that remove services from those who need them the most, and have declined to take the opportunities that have been offered to them to be accountable to the people who are affected by those cuts.
Likewise, SNP ministers say that they want smaller class sizes and that they support parental choice, yet the policy that SNP councillors in Aberdeen are pursuing is to merge and close primary and nursery schools whose class sizes are deemed to be too small, and to deny parents choice in the placing of their children.
All that comes back to local government finance—to the funding that ministers provide and the choices that councils make about what to do with that money. As John Swinney said, the Accounts Commission announced last week that it will hold a public hearing to examine more closely how Aberdeen City Council has implemented best value and community planning in the past four years. That will be followed very closely by the many people in Aberdeen who face the loss of services as a result of council cuts, and I hope that it will be so arranged as to allow many of those people to attend the public hearing.
Like the Cyrenians' supporters who are sleeping out in the shadow of Marischal college, those people will want to know why it is okay to spend £80 million on turning a Victorian granite building into council offices while schools have to close because they cost too much to maintain. They will want to know how council reserves of £23.5 million in 2003 disappeared during the following four years, and why the council administration voted through £27 million of cuts last month just as the Accounts Commission was coming to a view on what to do next. If those drastic, panic-stricken cuts were designed to persuade the Accounts Commission that the council had no case to answer, they have clearly failed.
The administration of Aberdeen City Council should set aside its cuts and closures programme until the public hearing has been held. It should engage in genuine dialogue with all parties and with the public—the council tax payers of Aberdeen—on what the city's priorities should be and how they should be met. In that way, the council can hope to reconnect with its proud tradition of providing excellent public services, which it did for many years, and the citizens of Aberdeen can have some hope for the future of those services. If the administration fails to protect services and fails to reverse the decisions to cut and close vital services, it will not readily be forgiven in Aberdeen.
No one wants to pay more tax. On that basis, everyone throughout Scotland will welcome the fact that the council tax is not increasing this year.
Not everyone.
Well, everyone should.
The Scottish Government offered more taxpayers' money to each and every council if they agreed to freeze their council tax. It would be a strange councillor indeed who advocated increasing the council tax while being offered money from Mr Swinney not to do so, so it is no surprise that every local authority accepted an offer that they could not refuse.
I hesitate to make an analogy between John Swinney and the Godfather. After all, our Cabinet Secretary for Finance and Sustainable Growth is more used to being likened to an affable bank manager than to Don Vito Corleone, who is a fictional member of the Cosa Nostra. However, Mr Swinney did indeed make our councils an offer that they could not refuse, because refusal would have been economic nonsense. The fact that councils could not refuse the offer does not mean that making it was the right thing to do. In the case of my council—Aberdeenshire—we cannot pretend that the move was anything other than a financial cut, which is leading to cuts across the piece in much-needed services. Aberdeenshire Council has had to make £10 million of cuts from a budget of nearly £500 million.
At a stroke, the local government settlement will set the council's eight-year fair-share campaign back to where it started. In 2000, the council received just 88 per cent of what it would have received if financial allocations were made on a simple population basis. Slowly but surely, the previous Executive was addressing that unfairness. By last year, the discrepancy had been reduced from a gap of 12 per cent to 8 per cent. However, at a stroke, the current Government's financial settlement will take Aberdeenshire's share of the funding cake back to square 1—back to just 88 per cent of funding if the calculation were to be made on a population basis. That is the situation that Aberdeenshire's director of finance has described.
Eight years of work have been rubbished because the Cabinet Secretary for Finance and Sustainable Growth has not bothered to address the most important issue: the funding formula. When he was pressed on that recently in an interview for a north-east newspaper, he did not accept what he had done to Aberdeenshire. He did not know. He did not think that it was possible to do that in one year. I have news for the cabinet secretary: he did that. He needs to get more of a grip of his portfolio, because he needs to understand all the unexpected consequences of his actions. I am sure that he did not intend to create the situation that I described.
On Aberdeenshire's fair-share campaign, the cabinet secretary is obviously not quite with it. That surprises me, because two ministers represent Aberdeenshire as constituency MSPs. What exactly are Stewart Stevenson and—more important—Alex Salmond doing about the situation? It is obvious that they are doing nothing. Are they even aware of their council's fair-share campaign? The conclusion must be that they are uninterested or that they do not care.
Will the member give way?
Brian Adam would not give way to me, so he should sit down.
One thing is sure: if Alex Salmond were interested in Aberdeenshire Council's fair-share campaign, he would do something about it and the current state of affairs would not be allowed to continue. This is a poor state of affairs from the SNP Administration. It is unfortunate that the Government is unwilling to address the inherent unfairness in the financial allocation to Aberdeenshire. Since I was elected, I have pressed every Administration on that. We were doing something about the situation, but the SNP has put the position back to square 1. I for one intend to ensure that the people of Aberdeenshire know full well on whose shoulders the irresponsibility and unfairness rest—they rest with the SNP Administration.
Many will be aware of a health care issue that has strong local government links. Symptoms include increased temperatures, denial, angry verbal outbursts and serious bouts of nausea. Those who are immune to the condition must avoid feeling smug or gloating. The condition can be cured simply by ensuring that the words "historic" and "concordat" are not used in proximity to each other and that the words "council", "tax" and "freeze" are never used in the same sentence. An alternative cure might be for some Opposition MSPs to grow up and own up that the council tax freeze is a good thing for the people of Scotland.
The Scottish Government's pledge to work for a council tax freeze has been delivered, not by the Government or local authorities working in isolation, but by both working together as equal partners. All parties in the Parliament should warmly welcome that.
It is crucial that the Parliament respects the concordat and local authorities' decisions to freeze council tax, in the knowledge that by doing so they will gain extra revenue, which Pat Watters of COSLA estimated to be the equivalent of a 3.4 per cent uplift in revenue that will not cost council tax payers a penny. With that, hard-pressed council tax payers will experience a real-terms cut in their council tax, rather than the average 62 per cent increase since 1997. I know that many of our pensioners will celebrate the council tax freeze. That is why I urge every member to vote for the order, which will allow funds to be transferred to local authorities. I hope that we can build on that and soon deliver a fair local income tax.
We often have political knockabouts in the chamber, and I admit that I am no innocent in the matter. When a Glasgow Labour councillor said "God bless" the SNP for the additional financial support that Glasgow City Council would receive as a result of the council tax freeze, a wee motion from me appeared in the Business Bulletin to welcome those comments. I thank all those who supported that motion. No Labour MSP has seen fit to sign it, but I live in hope.
That councillor, whose comments appeared in the Evening Times, also said that the Scottish Government was giving Glasgow City Council
"money to do what we were planning to do anyway."
That point is crucial. At a stroke, those comments put paid to the lies and scaremongering—spread throughout Scotland and fuelled by Opposition politicians—that a council tax freeze would lead to cuts. We know that that is untrue and we must remind ourselves again of the moneys that will be given to local government: £34.8 billion in the next three years, which represents a 12.9 per cent increase.
Does the member accept Joe FitzPatrick's figure of £27 million of cuts in Aberdeen this year?
According to Lewis Macdonald, only Aberdeen MSPs are allowed to talk about Aberdeen, so I could not possibly comment—I apologise.
For the first time, local government will receive an increased share of the spending cake rather than a smaller slice, as it did under the previous Executive. That spending cake will not be top sliced as it was by the previous Executive, which demanded efficiency savings of local authorities that had the disincentive of knowing that they would not receive a single penny back—they were robbed of those savings.
The Scottish Parliament information centre estimates that the Government's end to top slicing and allowing local authorities to keep their efficiency savings will raise an additional £658 million for councils over the next three years.
Will the member give way?
On that point?
On a point of my choosing.
No, thank you.
The previous Executive would have denied local authorities that money, but we will ensure that local authorities keep it.
Let us have an end to scare stories. They cheapen the Opposition and the Parliament itself. We should support councils and hard-pressed council tax payers by approving the order.
I will focus on the gap between the rhetoric that we have heard from the Scottish Government about the level of finance for local government and the public services that it will support and the reality of what is happening. I will give concrete examples from issues in which I have been involved in the past few weeks in Edinburgh and Leith and I will not become engaged in a war of statistics, except to point out that many official figures are underestimates—for example, the £780,000 cut in grants to the voluntary sector in Edinburgh is actually £2.6 million if we take account of efficiencies and a lack of inflation provision.
Schools highlight sharply the gap between the rhetoric and the reality. At a school in my constituency last week, I talked to distressed staff who face the reality of a cut in staffing numbers next year. That is happening when the Government is talking about smaller class sizes, which I presume should mean more teachers. That cut is part of the £3.8 million cut in funding to schools in Edinburgh, which is more than 1.5 per cent of the overall budget. On top of that, £966,000 will come out of sure start and 320 full-time nursery places will be lost. Both those developments fly in the face of the rhetoric that we heard a couple of weeks ago when the Scottish Government launched its early years strategy.
Another prominent cut that has provoked widespread concern in Edinburgh and Leith in the past few weeks is the £300,000 cut in funding for leisure centre crèches. I was pleased to support the campaign for those crèches, which continues. That cut is contrary not only to what the Government says in its early years strategy, but to all its good intentions on health improvement. In the past few weeks, I have met many parents—mainly women with young children—who, as a result of that cut, will no longer be able to use superb leisure centres in Edinburgh such as the Leith Victoria swim centre in my constituency.
It is not just the young who are affected. There is an on-going review of home care services in Edinburgh, and now only those who are in the critical care category are eligible for home care. Again, that is completely contrary to the Government's rhetoric about care at home in local communities. Those who are still to receive home care will attract a 17.5 per cent increase in the charge. If that is not bad enough, £8.2 million of cuts are still to be identified in the health and social care budget over the next three years.
Will the member confirm that the cuts in the City of Edinburgh Council's education budget, such as they are this year, are less than the cuts under the previous Administration? Many of the cuts are to managerial jobs, and teachers have been crying out for that for some time.
That does not reflect the experience that I had in the school in my constituency last week, and it is not true more generally. In fact, there was £52 million in the reserves when the previous Administration left office.
Having taken that intervention, I do not have time to go into detail on the £833,000 cut in the community learning and development budget and the 85 per cent cut in funding for the Edinburgh Community Newspaper Trust, which is threatening the excellent North Edinburgh News in my constituency.
I will conclude on an issue that concerns my portfolio of culture. We have heard a great deal of fine rhetoric about support for the arts from the new Scottish Government, but the reality of the administration in Edinburgh—in which the SNP is prominent—is that there has been a cut of £83,000 in support for the outreach services of Scottish Opera and Scottish Ballet. We believe not only in supporting excellence in the arts, but in ensuring that that excellence is available to the widest possible range of people. The programmes of Scottish Opera and Scottish Ballet in schools and in the community more generally will be decimated by that cut.
When it comes to culture policy, education policy and care of the elderly, we hear fine words from the Scottish Government but the reality on the ground, time and again, contradicts those policies. It is very important, in this debate and more generally, that people listen to what is happening in the real world and test the Government's fine words against the reality.
Today's debate is another clear sign that the SNP Government is delivering for the people of Scotland. In under a year, the Government has established a new relationship with Scotland's 32 local authorities and given them more powers to make decisions at local level through the historic concordat. We have put an end to the years of council tax increases that took place under the previous Administration by freezing the tax. In doing so, we have set Scotland on the road to a fairer system of taxation that is based on the ability to pay.
As usual, the financial experts on the Labour benches have been vocal in the debate. However, we will take no lessons on local government finance from the Labour Party—a party that proposed a ludicrous council tax rebanding policy during the election that even its own candidates did not believe added up; a party that bizarrely voted against the Scottish Government's budget after its own amendment had been accepted; and a party that presided over a disgraceful 62 per cent rise in council tax.
Let us not forget the secret implication of Labour's plans to tinker with the council tax. It is the implication that dare not speak its name, which will terrify council tax payers throughout Scotland—revaluation. I am happy to take an intervention from any Labour member who wants to explain their policy on revaluation—but there is silence, as expected. The fact is that if there are any changes to the bands, there must be a revaluation, and revaluation in Wales resulted in a third of homes going up at least one band and only 8 per cent going down. In my constituency, moving up one band from band D to band E would cost people £350. That would be the cost of Labour's proposed revaluation; no wonder the Labour Party will not talk about the implications of its policy of tinkering with the council tax.
As the cabinet secretary stated, we have entered a new era of co-operation with local authorities, which benefits the people of Scotland by offering increased funding and increased control over how that money will be spent locally, but without any increase in council tax.
Will the member take an intervention?
I would be pleased to take an intervention if the member will talk about Labour's revaluation policy.
I would like to talk about—
No, no, no.
The member mentioned budgets—
I am not going to—
Just one moment. I think that I am in charge here—the last time I looked, I was.
Sorry.
Are you taking Mr McAveety's intervention?
Not if he is not prepared to talk about—
You either take it or you do not.
No. I have made it clear that I will take an intervention from any Labour member who is prepared to stand up and talk about the implications of Labour's council tax policy, but not one of them has the guts to do that.
Will the member take an intervention on that point?
On revaluation.
The SNP has a minister with responsibility for local government finance. Will the member ask the minister to consider revaluation?
Mr McAveety did not answer the question. Our Government is getting rid of the council tax altogether, which means that there is no need for revaluation. Only if we kept the council tax would we need a revaluation, which would put a third of houses up by at least one band. That would cost £350 in Dundee, probably more in Aberdeen and about the same throughout the rest of Scotland.
We have heard Labour claim that the council tax is fine, but clearly it is not. Council tax benefit fails to address the major flaws in that form of taxation. Figures that were published by the UK Government show that 150,000 pensioners in Scotland who are eligible for council tax benefit—almost 40 per cent—do not claim. That is clear proof that we need a new approach. Those pensioners will benefit disproportionately from the introduction of a fair local income tax that is based on the ability to pay, and they will benefit most from the council tax freeze in terms of the proportion of their income that the tax constitutes.
The Labour Party is not interested in such figures. It is blinded by its opposition to all progressive policy from the SNP Government and would rather snipe from the sidelines without offering any credible alternative.
Will the member give way?
I am in my last 30 seconds.
The arguments that we have heard today from the old Lib-Lab alliance are lacklustre and offer nothing for the average Scot. For the Scottish public, the situation could not be clearer. Under Labour, there has been a rise of 62 per cent in the council tax; under the SNP Government, they will pay not a penny more in council tax and they have a commitment to a cut in the tax burden for those who need it most, based on the ability to pay.
Last week, in the chamber, members heard Tony Benn talk about faith in politics. What we have heard today from the SNP members—the true believers—is that all that matters in the local government debate and in local government funding is a council tax freeze. There has been a paucity of attempts to defend budget decisions at the local level, despite the information that was given by Malcolm Chisholm from his constituents—and even from Brian Adam's constituents. Brian Adam did not defend his constituents; he praised his minister. Like the other Bryan Adams, he said, "Everything I do, John, I do it for you." That is the reality of the SNP Administration.
Three weeks ago, Mr Swinney appeared on "Newsnight Scotland". I read with interest this month's Holyrood magazine—I am using media comments because that is what the First Minister does at question time—in which Mr Swinney says:
"I enjoy media jousts, I'm all for discussion with the media … but it's impossible in terms of getting your message across when you cannot say 18 words on a first answer in an interview without being interrupted and repeatedly interrupted until you cannot complete a sentence."
Aw.
I, too, felt sorry when I read that. He continues:
"I find that the most pointless style of television discussion."
Fine. Mr Swinney is now in the chamber, and today's debate is about how he justifies his decisions on the council tax freeze while ignoring the consequences and the reality in our communities.
A second issue of concern is local government's share of the budget. As Andy Kerr identified, the average local government share of Government spend was larger under Labour than it is under the SNP Administration. According to SPICe figures, the average share under Labour was 35.5 per cent, whereas the average share under the SNP is 33.6 per cent.
Will the member give way?
No, I want to make progress on this. Bob Doris is one of the true believers.
Mr Swinney has been going around Scotland's local authorities claiming, "I am doing this for your benefit." It is, however, a Venus flytrap. He has identified a budget figure to get the council tax freeze and is now sucking the life-blood out of local government on three grounds, which Tavish Scott has identified. The first of those is the local income tax, which is neither local nor something for which local elected members are accountable. In the long run, it will destabilise local government.
The second ground is the impact on services that has been identified by three or four members and which has been exemplified by the Aberdeen members' concern about the impact of the budget in Aberdeen.
The third ground leads me to touch on something that Keith Brown said. I was a local government leader for a couple of years, and I was a councillor during reorganisation, with responsibility for a major committee. The golden rule of the reorganisation debate was that, whatever else, the baseline had to be protected from the new authorities that were merging into the unitary authorities. The baseline figure that Mr Swinney has produced has resulted in a number of fundamental mistakes.
Will the member take an intervention?
I am happy to take an intervention if the member can tell me what he was doing when tough budget decisions were being made during local government reorganisation.
During local government reorganisation, I was fighting against Labour-led Glasgow City Council, which had council tax increases during its first three years of 20 per cent, 22 per cent and 12 per cent. Will Mr McAveety welcome for the third year running a council tax freeze in Glasgow, with the one difference this time being that there is a 3.4 per cent increase in funding from the SNP Government?
The majority of the increases that the member mentioned were because of the settlements that were given to Glasgow City Council by a Conservative Administration. The council tax increase trend in Glasgow has been lower than the rate of inflation and, in recent years, Glasgow has pioneered a council tax freeze, when appropriate, at a local level—I use those words carefully to show that I am not talking about the council taking the uniform position that the Government has taken.
On the wider issues, Mr Swinney claimed that he was not able to put his point across on "Newsnight". In fact, he was interrupted a number of times, but he did not answer the central question. Who did that remind me of? Yes, Michael Howard being asked that question repeatedly by Jeremy Paxman. However, Mr Swinney's performance makes me think more of Frankie Howerd, because he is saying:
"Infamy, infamy. They've all got it in for me."
We ain't got it in for Mr Swinney; we have identified the fact that his budget in real terms and in the experience of real people is diminishing the quality of council services across Scotland. How does he justify that?
Two weeks ago, when Mr Salmond was asked in Edinburgh who has the responsibility for the cuts in Edinburgh, he said, "I blame the Liberal Democrat leader of Edinburgh council." When asked in Aberdeen recently about who is responsible for Aberdeen's budget cuts, he said, "I blame the Liberal Democrat leader." I have news for Mr Salmond: the SNP is in both those administrations. Mr Swinney must take responsibility for those actions instead of hiding behind kidology about local accountability for those decisions.
The debate has fallen between those who think that the local government settlement is bad and those who think that it is good. I will run briefly through the contributions of those who think that it is good.
Mr Bob Doris made what I presume is an historic speech of loyalty to his cabinet secretary. He particularly mentioned the local authority council tax freeze. Of course the decision to accept such a freeze can be made by local government leaders, but it sure is an easy decision for them to make when a gun is pointed at their heads. That is the reality of the situation. I notice that Bob Doris welcomes it in his own area, although I am sure that he does not welcome the fact that Glasgow City Council's figures show that 425 posts are likely to go because of the efficiency savings.
Does the member accept that those 425 posts are being lost because of a restructuring of services in Glasgow and that it has nothing at all to do with the council tax freeze?
I am sure that it will bring a sense of relief to the people who lose their jobs when Bob Doris points out that that is happening because of restructuring, which is caused by the fact that, as Mr McAveety pointed out, all that appears to matter today in local government finance is the council tax. All parties should have more feeling for the range of local government finance issues that the Parliament must confront rather than concentrating on one aspect of it.
Mr FitzPatrick raised the issue of local income tax. I agree with him about that, if his party is proposing just that. At the moment, it is not. If a local income tax is to be a local income tax, there is a clue in the first word of that phrase.
Mr Brian Adam called the local government settlement "generous" which, as other members have pointed out, will be news to many people in the north-east.
I will come back to Mr Brownlee, but he also supported the Government as if he were a member of the Government.
Of those who opposed the local government settlement, the member whose argument I found most difficult was Keith Brown. I respect Keith Brown's knowledge as he is, like Mr McAveety, a former council leader. Members who were council leaders bring expertise to the chamber, and I respect Keith Brown and Frank McAveety's knowledge of leading large and small Administrations. I could not therefore understand why Mr Brown took his argument into the blame game by blaming local councillors for their decisions. That is the essence of where the debate is. My contention, and that of the Liberal Democrats, is that the decisions that local governments, of whatever political position, now have to take have been foisted on them by the settlement that they have received from central Government. That is always the way; it does not matter which Government is in power. We come into the chamber and spend a morning playing the blame game, as Mr Brown did. That is unfortunate, at best, particularly if, like Mr Brown, one has considerable knowledge and understanding of local government.
Lewis Macdonald raised the issue of the north-east, as did Richard Baker and Mike Rumbles. I found it interesting that Joe FitzPatrick was so well briefed on Aberdeen's position when he made his intervention. He is either extremely knowledgeable about local government finance, or he has taken his whip's instructions particularly well.
One of the more important points that were made this morning was the cabinet secretary's point about the distribution formula. If I heard him right—I wrote down his remarks as he made them—he said that there will be a "simplification" of the distribution formula in coming years. Mr Swinney might deal with this point in his winding-up speech. My understanding is that we have a three-year settlement, so I assume that any simplification of the formula could come about only during the fourth or subsequent years of local government finance. Mr Swinney has made a commitment in respect of the City of Edinburgh Council, but I am not aware that any commitment has been made to any of the other 31 local authorities across Scotland. It is fundamental to the Parliament's scrutiny of any Government that members know what that change to the distribution formula might mean, and the timescale to which it would operate. I ask the minister to deal with that in his closing remarks.
Finally, I will deal with the Conservatives, who are in a ridiculous position. I will quote Miss Goldie for Mr Brownlee's benefit, because he cannot have read these immortal words at the time—and this from a Conservative party that is hooked into and dying a death with the SNP Government on the issue of local government finance. Miss Goldie said that the nationalists are following a "left-wing agenda" and she accused ministers of "living in the past" when it came to public services. Why the devil did the Conservatives vote for the budget and support every aspect of it? Why are they now apparently so out of touch with it? Their position is extraordinary.
If Mr Brownlee and his colleagues—they all look very cheerful at the moment—are saying that they are not going to support a simple amendment that
"regrets the extent of public service cuts",
I can only assume that they support public service cuts. I assure Mr Brownlee that every leaflet that is sent out in his constituency will point that out.
The debate is about accountability, the impact on local services and public finances. We should debate the subjects in that sphere.
We can all play the quotation game, if we like to. Let us look at what Mr Scott said during the previous local government finance debate:
"The order will achieve a number of outcomes that Liberal Democrats support … We also support the allocation of additional resources to local councils".—[Official Report, 7 February 2008; c 6020.]
It seems that Mr Scott has changed his position slightly from the one that he took during the previous debate. I note in passing that not a single Liberal Democrat voted against the Local Government Finance (Scotland) Order 2008 two months ago. It was therefore slightly hypocritical of Mr Scott to make the comments that he did about the Conservatives today.
I move away from what Mr Scott said to put forward the Scottish Conservatives' position. We welcome the council tax freeze, as my colleague Mr Brownlee said, and we welcome the reduction in ring fencing. We will therefore support the order at decision time this evening.
I wish to focus on the subject of my first contribution to the debate, which was on single outcome agreements. I asked the cabinet secretary how many single outcome agreements are in order and in place. On the face of it, the answer at this stage appears to be none. Some are in draft, and we might get some before the summer recess.
I chose the words "in order and in place" carefully, because they were the exact words that the cabinet secretary used in the debate on the Local Government Finance (Scotland) Order 2008 in February. He stated:
"We are well on the way to putting in place single outcome agreements with each council. I expect them to be in order and in place by 1 April 2008."—[Official Report, 7 February 2008; c 6011.]
In the run-up to today's debate, we tried hard to find out exactly what progress had been made on single outcome agreements. We wanted to know what the structure of a single outcome agreement will look like, what issues will be captured, what level of detail will be involved, what monitoring will take place and what measures will be taken to deal with underperformance. On Tuesday, at 3.24 pm, the Government told us:
"they have been put back by 3 months—drafts by 31 March, finals published 30 June".
I share Mr Brown's concern about the failure of single outcome agreements to appear. The difference between us is that he was willing to sign off £11 billion of public expenditure without knowing what the single outcome agreements were, whereas we were not. Does he now regret that?
I have with me the voting record for the debate of 7 February. I gently point out to Iain Gray that all the Labour members who turned up to vote on that day voted in favour of the Local Government Finance (Scotland) Order 2008. Mr Gray's comments are a bit rich.
When we tried to find out what progress had been made on single outcome agreements, we were told on Wednesday morning at 9.39 am that "a few" had been completed but that we will have to wait until June, when they will be published. However, by Wednesday afternoon the Government was saying:
"we expect most to be in by 31st March but one Council has asked for an extension into April due to council meeting timetables".
Conservative members do not think that enough progress has been made on single outcome agreements. We need to know how much councils will spend on statutory functions and agreed outcomes and, ultimately, how much discretion they will have, so that Parliament can scrutinise agreements.
In closing, I note another comment that the cabinet secretary made during the debate on the Local Government Finance (Scotland) Order 2008. He stated:
"That will be translated into single outcome agreements, which are currently under development with local authorities. That work will be taken forward in advance of 1 April. I give that commitment to Parliament today, and I am happy for it to be scrutinised because the Parliament should be able to satisfy itself on how public money is spent."—[Official Report, 7 February 2008; c 6046.]
We need to have sight of single outcome agreements without delay. During the previous debate on local government finance, we were given a firm commitment, but today we need a firmer commitment that must be honoured in full.
The settlement looks increasingly tarnished as every day goes by and every council up and down the land makes further cuts. That is its real impact.
This morning, SNP members have argued that the council tax freeze justifies everything, including the settlement's impact on services for the disabled, the elderly, schools, teachers, cleaners and those attending adult education classes. At last, the Tories have been converted on the issue of single outcome agreements but, during the debate on the budget, my colleague Iain Gray made clear that they were signing off resources without evidence of delivery.
Will the member give way?
I will take an intervention in due course.
In recent years, staffing figures for local government have risen, but now they are beginning to fall. Many members have referred to cuts in the voluntary sector. Tavish Scott made some interesting remarks on the general context of the settlement and raised the big issue of local democracy. In an intervention, Mike Rumbles mentioned Don Corleone—the settlement was an offer that could not be refused. The SNP Administration has taken away absolutely local authorities' right to exercise revenue-raising powers at a local level and has imposed a settlement from the centre.
We hear a lot from Derek Brownlee, who is the assistant Government spokesperson on local government finance these days. He should put us all out of our misery and cross the chamber to join the SNP's front-bench team, because he has supported the SNP in every debate in the chamber. He has drawn barely any attention to one Tory policy and has spent most of his time attacking either the Liberal Democrats or Labour. Well done to Derek Brownlee on his Government speech.
The words of Brian Adam, who spoke of a "generous settlement", will be ringing throughout Aberdeen, Aberdeenshire and the rest of Scotland. That was an outrageous statement, given the severe cuts that are being felt up and down the land. When constituents write to me and my colleagues about those cuts, we will simply refer them to Mr Adam's statement.
Mr Keith Brown described the settlement as "a gift". What sort of gift is it to people who are spending the nights outside in Aberdeen, as efforts are made to retain local homelessness services, to people in Scotland who are losing services for their disabled children, to teachers who are receiving redundancy notices, and to school cleaners who are losing their jobs? Well done to Mr Brown on that point.
Richard Baker and Lewis Macdonald highlighted some of the very severe cuts that are being made in Aberdeen and elsewhere as a result of the settlement. Mr Rumbles mentioned the impact of the council tax freeze. Mr Doris described the settlement as "a good thing". He also had the audacity to accuse Labour members of scaremongering when all the predictions that we made and the scare stories that we told about the impact of the settlement on the voluntary sector and those most in need—Malcolm Chisholm mentioned the situation in Edinburgh—have come true. Bob Doris's comments may be neatly counterposed with Malcolm Chisholm's speech—from the rhetoric to the reality; from comment in the chamber to real feelings out in our communities.
Every Conservative speaker in every debate on local government finance in the past six months has mentioned single outcome agreements, so the issue is not new to us. Will the member tell us which way he voted in the debate on the Local Government Finance (Scotland) Order 2008?
I voted in favour of the order and indicated that I would do so during the preceding debate—that should be no surprise to the member. However, when the Conservatives were having their secret, back-door negotiations with the Government in September last year, could they not have raised the issue of single outcome agreements and mentioned that the Parliament was about to send £11 billion of public money out into the community with no accountability? When they are having back-door discussions on the budget next year, perhaps they will take time to raise the issue with ministers.
Frank McAveety compared Mr Swinney to a Venus flytrap, highlighting the fact that, to his credit, Mr Swinney has managed to entice local authorities into this deal. Now they understand that they have been sucked dry by the settlement.
Tory members have said that we voted for the settlement. The cabinet secretary is making the same point from a sedentary position. Will Andy Kerr confirm that the time to stop the budget was during the debate on its general principles, against which all Labour and Liberal Democrat members voted?
Indeed. Iain Gray and other members have made that point.
The SNP does not like to hear the facts. However, the funding tables for local government that SPICe has provided indicate that local government's share of expenditure was 35.5 per cent, on average, under Labour and will drop by 2 percentage points under the SNP. We invested in local authorities to allow them to develop and grow much-needed services, only for the SNP to disassemble them and remove them from communities throughout Scotland. That is the true effect of the budget. The Government is talking left wing but acting right wing. This is a bad budget for Scotland's poorest communities and households and for those who are most in need and who most deserve the local government services that Mr Swinney has removed.
This has been a fascinating debate. In the same debate, the Government has been accused of delivering both a right wing budget and a socialist budget. The fact that such different accusations can be levelled against ministers just shows the diversity of opinion that exists in this plural Parliament. Ministers are happy to answer for their actions in Parliament, and I will do so today.
I confirm to Mr Scott that the review of the local government distribution formula will take effect in 2011-12. A three-year arrangement is in place to give stability to local authority funding over the next three years. Any consequences of the announcements that I made during the budget process on capital city supplements will be delivered separately to the City of Edinburgh Council.
I have to say that I find Mike Rumbles's comments about the fairness of the distribution formula for Aberdeenshire a bit strange, given that the distribution methodology was agreed with COSLA through the three-year settlement group in which, as I understand it, Aberdeenshire Council participated. Moreover, that council will benefit from above-average increases in 2009-10 and 2010-11.
My point was that the cabinet secretary seems to be unaware that what he has done has at one fell swoop set back the fair-share campaign by eight years.
All I can say to Mr Rumbles is that in 2009-10 and 2010-11 Aberdeenshire Council will receive from the Scottish Government an above-average increase in its resources. Mr Rumbles should reflect on that pretty clear position.
A great deal has been made of the local authority share of the total Scottish block; indeed, Mr Kerr has been going through contortions over this issue. I cannot deny that in 2002-03 that share was 36.6 per cent. However, much to my regret, this Government was not in office in 2002-03; it did not come into power until 2007, by which time the share that local authorities commanded of the total Scottish budget had fallen to 33.4 per cent. The only parties responsible for that situation are the Labour Party and the Liberal Democrats, so I will not take a lecture from them about the declining share of local authority expenditure. In the budget that I have presided over, that share will, in the three financial years of the spending settlement, increase from 33.4 per cent to 33.565 per cent, 33.588 per cent and 33.624 per cent.
Let me put the financial position that Mr Kerr outlined in some context. In 2002-03, the Scottish Executive received an 11 per cent above-inflation increase in its departmental expenditure limit budget; this year, we received 0.5 per cent. In his speech, Mr Scott very fairly set out the context of the current financial climate. The general message is that Scottish public expenditure—which, I should point out, is not within my control; regrettably, as Mr Scott made clear, I have to work within the funding arrangement that the UK Government provides to me—will over the next six, not three, years be under greater stress than it was during the bountiful years of the budget that Labour and the Liberal Democrats had at their disposal. However, what did they have to show for it as a consequence?
If this budget settlement is the tightest ever and if there are all these problems associated with it, why has the cabinet secretary prioritised business tax cuts with no conditions attached and a council tax freeze that he must know comes with a risk to local services? I asked him the same question in the budget debate, but he did not answer it.
We have prioritised the cut in business rates to give Scottish businesses a competitive advantage and ensure that they can deal with the economic conditions that Mr Scott highlighted. We have also sought a council tax freeze to ensure that householders wrestling with rising fuel and food bills do not have to pay the same kind of rising council tax bill that they had to pay under the Labour Government that was in power for eight years.
With regard to the quality of the funding settlement, if I had applied the increase in budget that we received from the UK Government to the local authority settlement, the local authority budget would have gone up by 3.2 per cent. However, under this Administration, the budget has gone up by 5 per cent. [Interruption.] Once we take into account inflation—which I presume is what Mr Kerr is muttering about—it becomes clear that this Government has put 1.8 per cent more into local authority expenditure than the amount that we received from the UK Government's settlement. That is perhaps why the president of COSLA said that his job was
"to get the best deal possible for our local communities, and I believe that's what we have done".
It has been a pleasure for the Government to ensure that we have a local authority settlement that delivers investment in public services above the level that local authorities could have expected; a fully funded council tax freeze; and the opportunity for local authorities to operate with flexibility and freedom to deliver for their communities. That is what the Government expects them to do.