Current status: Answered by Hannah Mary Goodlad on 16 June 2026
To ask the Scottish Government what proportion of local government funding was formally ring-fenced or otherwise directed to national policy objectives in each of the last three years, and what its response is to the Accounts Commission's finding that ring-fencing and directed spending reduce local authorities' flexibility to meet local needs.
The vast majority of funding (97.9% in 2026-27) continues to be provided to councils by means of a block grant from the Scottish Government. This is set out in the final Annex of the relevant Local Government Finance Circular, for example, Annex K of Local Government Finance Circular No. 2/2026.
It is the responsibility of individual local authorities to manage their own budgets and to allocate the total financial resources available to them having first fulfilled their statutory obligations and a number of national priorities agreed with COSLA. Many of those nationally agreed priorities entail additional funding being provided in-year by the relevant portfolio. In-year transfers are set out in the relevant chapter of the Scottish Budget, for example, Table 4.15 of the Scottish Budget 2026-27.
Work continues with COSLA and local government partners to reduce ring fencing and in-year transfers where possible and over £2.3 billion of previously ring-fenced funding and in-year transfers has been consolidated into the General Revenue Grant, since 2023.
The total funding provided to local government and the amount that was formally ringfenced and allocated as in-year transfers is set out in the following table, as requested.
Total Funding (£m) | Formally Ringfenced (£m) | In Year Transfers (IYT) (£m) | Total (Ringfenced & IYT) (£m) | % Formally Ringfenced | % Ringfenced &IYT | |
2026-27 | 15,999.0 | 334.0 | 907.7 | 1,241.7 | 2.1% | 7.9% |
2025-26 | 15,177.1 | 408.1 | 1,463.3 | 1,871.4 | 2.7% | 12.3% |
2024-25 | 13,913.4 | 384.3 | 1,574.4 | 1,958.7 | 2.8% | 14.1% |