Scotland’s councils have warned that vital local services are at risk without a fairer funding settlement, after making around £5 billion of savings since 2010-11 and facing a further £529 million funding gap in 2026-27.
Councils deliver the services people rely on every day, from educating more than 700,000 pupils, to supporting almost 98,000 people with care at home, maintaining 54,000 kilometres of roads, tackling homelessness and supporting vulnerable families.
With years of efficiencies and service redesign, councils say there is little left to cut. Spending on culture and leisure has already fallen by 26% in real terms since 2010-11, while corporate support spending has reduced by 25%. At the same time, demand for services and inflation continue to rise.
COSLA’s concerns are backed by several independent organisations.
The Accounts Commission has warned that council funding is failing to keep pace with rising costs and demand, while the Joseph Rowntree Foundation continues to highlight the growing levels of poverty and hardship driving demand for local support.
Together, the evidence paints a clear picture: communities need stronger local services at precisely the moment councils are under the greatest financial strain.
COSLA Resources Spokesperson Kelly Parry said: “There is little left to cut without communities feeling the impact. Councils have already delivered billions in savings while continuing to provide the services people rely on every day.
“Local services are the foundation of strong communities. If Scotland wants high-quality schools, social care, roads and local support services, councils must be given the resources to deliver them.
“The choice is clear: either we invest in local services or we accept their decline. Communities across Scotland deserve better than that.”
COSLA is calling for increased investment in local government, including support to meet growing social care demands, inflation-proofed funding, greater local flexibility and multi-year settlements that allow councils to plan effectively for the future.
“Strong communities need strong councils. If Scotland wants high-quality local services, local government must be properly funded to deliver them.”
COSLA today commented on education reform as part of the Scottish Government’s Public Service Reform proposals.
The First Ministers publication of a proposal to move to fewer regional councils and create many community authorities creates extensive structural reform which carries significant financial, operational, democratic and service-continuity risks, with transition costs and benefits not yet quantified or thought through.
COSLA and Scottish Local Government has long supported reform, but reform that makes the most of the democratic spheres we have. We must recognise the separate roles but collective responsibilities we have to deliver vital public services to the people of Scotland. Doing so creates a Scotland where all children and young people can grow up feeling loved, safe and respected so that they realise their full potential.
The integrated services that councils deliver are essential to achieving this. COSLA is clear that structural reorganisation should not be the starting point. Scotland’s education system must instead focus on improving the curriculum, supporting children and families, attracting and retaining a highly skilled workforce, strengthening leadership and ensuring that responsibilities and resources are clear at every level.
Commenting, COSLA spokesperson for Children and Young People, Cllr Tony Buchanan said: “Scotland should be ambitious for every child and young person. Reform must close the gap between a good education system and a great one, while recognising that learning is inseparable from family support, tackling poverty, health, housing and the strength of local communities.
“Structural change is not an outcome in itself. Large-scale reorganisation without a clear, costed and independently tested business case could divert money, time and professional capacity away from classrooms, children and families.
“Councils are uniquely placed to connect education with the wider services that help children and young people thrive. We support reform that strengthens teaching, the curriculum, prevention, workforce planning, regional capacity and accountability, while keeping decisions as close as possible to the communities they affect.
“Our preferred approach is practical, proportionate and evidence-led: agree the functions and outcomes, establish the financial and workforce baselines, test stronger collaboration, and scale or legislate only where independent evaluation shows that change will deliver better outcomes, greater equity and stronger public value.”
Council leaders have urged caution around Scottish Government’s plans to reform Local Government and called for strong evidence to underpin any significant changes.
Following a meeting of COSLA Leaders yesterday, Cllr Shona Morrison said: “The Scottish Government’s proposals leave more questions than answers.
“It is vital that reforms are based on sound evidence and that meaningful engagement takes place. For that reason, COSLA will participate fully in this period of dialogue to shape the future of local democracy in Scotland.
“If local government is to be reformed, it must be about bringing decisions closer to communities, improving local democracy and delivering better outcomes for all. Significant changes like this must be agreed between Scottish Government and local government and not imposed from the top down.
“Communities must be at the heart of reform. COSLA Leaders are clear that communities and vital staff delivering services day-in-day out must meaningfully inform the future of local services.
“While we all agree on the need for reform, this will not work if it is imposed on councils and the communities they serve so we are calling for Ministers to commit that any changes will be implemented only through agreement with existing local authorities. This will be an important message to send ahead of next year’s local council elections.
“As councils continue to deliver vital services it is vital Scottish Government works with COSLA to bring clarity to these questions and act on sound evidence.”
Thursday 26 February was Budget Day for the City of Edinburgh Council. The current Labour administration put their spending plans for 26/27 up for scrutiny and we, along with other unions and organisations, were at the City Chambers to let them know out thoughts.
The day started with a small demonstration outside the City Chambers, demanding Fair Funding for Local Authorities. Unite, the Union’s most recent national campaign is calling on the UK government down in Westminster to properly fund local authorities after years of austerity.
We were told this Labour government was bringing change – instead, local services keep getting starved of funds and people are losing faith in the public sector.
Once inside, we listened and echo the excellent deputations from Living Rentand the Edinburgh Tenant’s Federationabout the need for more support for tenants across town and for proper enforcement to hold rogue landlords accountable.
The Welcoming Associationalso spoke, giving a strong testimony about the important work they do to integrate and welcome “new scots”, requesting core funding from the Council in order to be able to consistently deliver for the communities they support.
TheEIShighlighted the need for further investment after years of cuts but, nevertheless, welcomed the money set aside for more staff and infrastructure for a more robust ASN support.
The Edinburgh Trade Union Council mentioned this year they would be celebrating the 50th anniversary of their first deputation to the CEC where they also addressed the topic of Housing.
Claire and Des spoke of the impact the housing emergency is having on Edinburgh’s families and how this is becoming increasingly visible in children in our schools.
Our deputation echoed some of the points raised by the other speakers and focused on three areas – Housing, Education, and Worker’s Pay.
Housing
While recognising the considerable investment in Housing which will double the amount of homes delivered by the Council in the next 10 years, we stressed this is simply not enough. By the Council’s own assessment, this only amounts to between 1/5 and 1/6 of what is needed. Additionally, although they claim this investment is in affordable housing, it includes mid-market accommodation which are exempt form future rent controls and is still well-above most worker’s budget.
Still, we hope this investment leads to more good council jobs and apprenticeshipsand that the Labour group will keep to their “insourcing” agenda and draws from the wealth of knowledge, skill, and expertise we have in our Housing Property team, rather than outsourcing these projects to non-living wage paying businesses. It’s essential to build an experienced and reliable workforce with good employment conditions to restore the tenant’s and residents faith in the public service across the city’s estate.
Schools
The Council proudly announced the narrowing of the attainment gap with more pupils from deprived backgrounds achieving more qualifications at all levels which an extremely positive development – but let’s not rest on our laurels. Schools in our Edinburgh have become the front line of a social emergency. Teachers who are already under immense pressure are now tasked with supporting pupils facing increasingly complex challenges as a result of high poverty rates in this city. The high standard of council schools is sustained due to the essential and immeasurable contributions and hard-work from some of the lowest paid workers in the whole local authority – Pupil Support Assistants and other School Support workers.
The recent review into School Support failed to address the gap between what is written on a PSA’s job description and what really goes on a daily basis in our schools. Our School Support colleagues work beyond their remits every day to meet the needs of the young people they support because they care deeply about helping them. There is a real need for a proper career progression, non-contact time included in the daily schedule, fair pay, and more protection and training to help deal with the increasing demand and scope of behaviours displayed by pupils in both mainstream and special schools.
Simply deploying more low paid staff does not solve the underlying crisis schools face regarding the complexity of need we are currently witnessing. Instead, it puts workers in situations with a higher level of unpredictability and risk. We sincerely hope the proposed investment translates into a measurable decrease in the amount of violence support workers face on a daily basis – because you cannot bridge an attainment gap while the staff expected to close it are pushed to breaking point.
Pay
We are proud to work for the people of Edinburgh and for this Council and, therefore, expect our employer to value and protect us. Instead, this administration is presenting a pay cut on its own workers and asking them, in their own words, to “continually deliver more with less resources”.
In April, every council worker will see their pay go up by 3.0% – the second part of a 2-year deal negotiated by the unions with COSLA. This budget will increase council tax by 4% and council tenants will see their rents go up by 7%. If the payslips of the people of Edinburgh cannot keep up with the rising cost of living exacerbated in part by this council tax hike, the Council cannot act surprised when more people turn to the local government for support. This regressive mode of taxation is being raised of the backs of ordinary people and some of the most vulnerable among us, instead of high earners living in Council Tax Bands E and above.
Every Councillor got a QR code for our campaign big enough to hang it proudly in their offices.
Finally, we are fully aware that some of the shortcomings of this budget are due to insufficient funding from the Scottish and Westminster governments, which is why we challenged all the Councillors present to subscribe to Unite’s Fair Funding for Local Government and to send a message to their MP down in London.
We left every Councillor in the chamber a big enough QR code so they can proudly display it in their offices You can also sign the petition here and send a postcard for free to your MP here.
Many more aspects of this budget could have been raised but João and Étáin used the limited time they had to speak on the topics that were most relevant to them.
We will keep tabs on this Council to see through promises made in this budget and, in the meantime,we will continue to support our members and fight for a fairer more equal Edinburgh.
COSLA has written to Shona Robison MSP, Cabinet Secretary for Finance and Local Government, on behalf of Scottish Local Government after the Scottish Budget which took place on the 13th January 2026.
COSLA Leaders have since met to discuss the 2026/27 Scottish Budget and Local Government Settlement. Our Leaders agreed that this year’s settlement is a very poor settlement for local government which fails to address the dire financial situation of local government.
Further, it was noted that the settlement does not offer the urgent financial support required for social care and social work.
Social care pressures are spiralling. Integration Joint Boards have faced £497m pressures in 2025/26. A £750m investment in the Scottish Budget could stabilise the system, says COSLA:
Social care pressures are spiralling.
Integration Joint Boards have faced £497m pressures in 2025/26.
A £750m investment in the Scottish Budget could stabilise the system.
COSLA is urging the Scottish Government to provide a £16 billion boost in revenue in the Scottish Budget, to secure fair and sustainable funding for councils.
A demand for a £844 million general capital settlement has also been requested, plus a restoration of the Affordable Housing Supply Programme to £955 million, to maintain, repair, expand and secure the future of Council estates.
COSLA has launched a lobbying campaign urging the Scottish Government to use the upcoming Scottish Budget to provide councils with the fair, sustainable and multi-year funding needed to protect essential local services.
The campaign – ‘Strong Councils, Strong Communities’ – highlights growing pressures facing local government and the very real consequences of continued underfunding for communities across Scotland. The financial pressures in social care and housing are two key areas COSLA are asking the Scottish Government to specifically address in their upcoming budget.
COSLA warns that without urgent action in January’s Budget, councils will be unable to maintain essential services such as social care, education, housing support, roads, and community safety.
COSLA Resources Spokesperson, Councillor Ricky Bell, said: ““Scotland’s councils deliver the services that people rely on every single day — from caring for older and vulnerable people to keeping schools open, streets safe and communities thriving.
“Councils are facing greater demand than ever and are required to do more with significantly less. This is unsustainable.
“The upcoming Scottish Budget is a pivotal moment. The Scottish Government must deliver a settlement that matches the scale of the challenge. Without fair funding, communities will see services reduced and inequalities deepen, and we will struggle to meet national targets in key areas such as child poverty, housing, and net zero”
This year, councils continue to face rising inflation, increasing demand for services, and the continued impact of workforce pressures across social care and education. COSLA’s analysis shows that even maintaining current services requires substantial additional investment.
As a fair and sustainable overall financial settlement COSLA’s key asks from the campaign include:
An immediate £750m investment in social care.
Flexibility for councils to make local decisions that respond to community needs.
Recognition of local government as an equal partner in delivering national priorities and tackling inequalities.
COSLA President, Councillor Shona Morrison, added:“Councils work tirelessly to deliver for Scotland’s communities, however, continued pressure on resources makes this increasingly challenging.
“This is about safeguarding what matters most, support for the most vulnerable, opportunities for young people, support for families, and safe, thriving communities.
“We hope the Budget will reflect the vital role Local Government plays in Scotland’s public services.”
COSLA is urging the Scottish Government to provide a £16 billion boost in revenue in the Scottish Budget, to secure fair and sustainable funding for councils.
A demand for a £844 million general capital settlement has also been requested, plus a restoration of the Affordable Housing Supply Programme to £955 million, to maintain, repair, expand and secure the future of Council estates.
COSLA has today launched a lobbying campaign urging the Scottish Government to use the upcoming Scottish Budget to provide councils with the fair, sustainable and multi-year funding needed to protect essential local services.
The campaign – ‘Strong Councils, Strong Communities’ – highlights growing pressures facing local government and the very real consequences of continued underfunding for communities across Scotland. The financial pressures in social care and housing are two key areas COSLA are asking the Scottish Government to specifically address in their upcoming budget.
COSLA warns that without urgent action in January’s Budget, councils will be unable to maintain essential services such as social care, education, housing support, roads, and community safety.
COSLA Resources Spokesperson, Councillor Ricky Bell, said:“Scotland’s councils deliver the services that people rely on every single day — from caring for older and vulnerable people to keeping schools open, streets safe and communities thriving. Councils are facing greater demand than ever and are required to do more with significantly less. This is unsustainable.
“The upcoming Scottish Budget is a pivotal moment. The Scottish Government must deliver a settlement that matches the scale of the challenge. Without fair funding, communities will see services reduced and inequalities deepen, and we will struggle to meet national targets in key areas such as child poverty, housing, and net zero”
This year, councils continue to face rising inflation, increasing demand for services, and the continued impact of workforce pressures across social care and education. COSLA’s analysis shows that even maintaining current services requires substantial additional investment.
As a fair and sustainable overall financial settlement COSLA’s key asks from the campaign include:
An immediate £750m investment in social care.
Flexibility for councils to make local decisions that respond to community needs.
Recognition of local government as an equal partner in delivering national priorities and tackling inequalities.
COSLA President, Councillor Shona Morrison, added:“Councils work tirelessly to deliver for Scotland’s communities, however, continued pressure on resources makes this increasingly challenging.
“This is about safeguarding what matters most, support for the most vulnerable, opportunities for young people, support for families, and safe, thriving communities. We hope the Budget will reflect the vital role Local Government plays in Scotland’s public services.”
Councils Leaders have issued a stark warning about the growing crisis in social care, urging the need for social care funding to be a clear and focused national priority.
Following a meeting of Council Leaders, COSLA’s Health and Social Care Spokesperson Councillor Paul Kelly said: ‘Social care underpins everything we value most within our communities – from dignity in later life, supporting people in their unpaid caring roles, to enabling people to live independently and participate fully in society.
“Local Government has consistently prioritised social care, protecting budgets where possible and working tirelessly to maintain services despite severe and well-evidenced financial pressures.
“But Local Government cannot do this alone. Demand is increasing, costs are rising, and the workforce is under immense strain. Without fair and sustainable funding, we risk the viability of services that people rely on every single day.
“Local Government is doing everything possible to sustain vital care and support services, but without urgent investment from Scottish Government to enable us to commission and deliver more care, the system is at breaking point. That is why as part of COSLA’s manifesto we are calling on the next Scottish Government to invest £750m into social care services.
“We urge a national focus on addressing the workforce and financial crisis social care is experiencing, to ensure those who need support are not left without the help they need to live fulfilling lives.”
COSLA, Scottish Government, care providers, and system leaders had been meeting in the first half of 2025 as part of the jointly convened Financial Viability Response Group to address risks and impacts of funding challenges across the health and social care sector.
Cllr Kelly continued: ‘It is crucial that we reconvene the social care Financial Viability Response Group immediately.
“We urge the Scottish Government to engage with us and our valued partners in the third and independent sector through the work of the Group to address the financial and workforce crisis in social care.”
COSLA’s 2026 Manifesto calls for sustainable finance for local services, including calling for an additional investment of £750m for social care:
