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Council leader offers a ‘win-win’ compromise on council tax increase

The leader of Inverclyde Council has offered a “compromise” on council tax to the Scottish Government after representatives voted for an increase as the Government pushed for a freeze.

Councillors backed an 8.2% rise this year and 6% next year in a meeting on Thursday.

But less than 24 hours later, council leader Stephen McCabe said he had “reflected on the discussions” at the meeting and has written to Deputy First Minister Shona Robison.

Ms Robison, who is also in charge of Scotland’s finances, said previously a share of the £62.7 million in extra funding for councils announced last week would not be available to authorities who raised tax.

In his letter, Mr McCabe said he would use the funding to offer a council tax rebate to Inverclyde residents which would amount to a freeze.

“I have reflected on the discussions at the full council yesterday and the desire expressed by many of my fellow councillors that Inverclyde residents should benefit from the funding on offer from the Scottish Government for a council tax freeze,” he said.

“I have therefore written today to the Deputy First Minister proposing a way in which this can be achieved.

“If the Government is willing to make this funding available on a recurring basis, baselined into the local government settlement for 2024-25 and beyond, I would be prepared to recommend to the council that we use the funding for 2024-25 to provide Inverclyde households with a one-off rebate on their council tax charge for 2024-25, which would mean that Inverclyde residents would receive a freeze in their council tax for 2024-25 in line with the First Minister’s national policy priority.”

The compromise, he said, was a “win-win” situation for everyone concerned and was “eminently reasonable”.

“The Scottish Government gets its national council tax freeze, Inverclyde households benefit from a local council tax freeze, and the council receives the benefit of a stronger council tax base,” he added.

Deputy First Minister Shona Robison said: “The funding the Scottish Government has offered Inverclyde to deliver a council tax freeze is equivalent to a rise of 8.2%.

“I simply do not understand why the administration of Inverclyde Council are saying they wish to reject this funding and instead increase council tax by 8.2% in the middle of a cost-of-living crisis.

“We’ve set out that the £45 million in consequentials will be available to councils who freeze council tax, and without the strict conditions that are being imposed by the UK Government on the source of this funding’s use, including the requirement for English councils to provide productivity and improvement plans to get their share.

“The Scottish Government remains committed to working closely with local councils for the benefit of people across Scotland.

“Good progress has been made on parts of the Verity House Agreement, including increasing funding flexibility to councils and removing ring-fencing in relation to almost £1 billion of funding in 2024-25.”