Thomas Bridge 12 December 2014

Scottish councils given extra £241m in funding settlement

Scottish councils have been handed an additional £241m this year to support young children and lessen the impact of the 'bedroom tax'.

Deputy first minister John Swinney has announced that in return for receive a total of £10.85bn for 2015/16, local authorities will be required to freeze council tax for the eight consecutive year and provide places to match the needs of all probationary teachers.

Speaking in parliament, Swinney said: 'This settlement is set against the challenging fiscal environment and the austerity measures which are set to continue with an estimated £15bn of cuts to public spending in Scotland from Westminster to public services. Despite that context the terms of this settlement offer to local government continues to represent a very fair settlement.'

Additional cash allocations will include £54m to give all school children in P1 to P3 access to a free school meal, and £44m to fund extended pre-school entitlement.

Some £38m of further funding has been provided for the Scottish Welfare Fund, £35m to fully mitigate the effect of the 'bedroom tax' and £6.5m to support admin costs stemming from the council tax reduction scheme.

Swinney said the additional money would allow local authorities to 'help those affected most by the Westminster cuts'.

The deputy first minister also announced Scotland would be providing around £618m of business rates relief for 2015/16, which he said would ensure the country 'remains the most competitive business tax environment in the UK'.

'I am also pleased to announce an agreement with COSLA to a revised Business Rates Incentivisation Scheme which will provide a more focussed incentive to local authorities by enabling them to increase revenues where they generate higher levels of growth.'

'In addition, our Community Empowerment bill, currently in parliament, contains provision for local authorities to offer targeted rates relief to stimulate economic growth in their areas.'

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