COSLA has set out concerns about the Scottish Government’s Budget settlement for Local Government, warning that while there is a modest increase in uncommitted revenue, the settlement remains insufficient to meet rising demand for essential local services.
Following a meeting of council leaders, it was stressed that the increase of £234 million in uncommitted revenue funding for 2026/27 does not address the scale of pressures facing councils, particularly in social care where demand and complexity continue to rise sharply.
COSLA also highlighted urgent concerns about the continued underfunding of the Real Living Wage policy.
While welcoming the increase in funding for the Affordable Housing Supply Programme, COSLA warned that the capital funding position for local government is becoming increasingly unsustainable, threatening councils’ ability to invest in vital infrastructure and community assets.
Leaders also expressed significant concern about the medium-term outlook set out in the Spending Review, which suggests continued de-prioritisation of local government and further real-terms cuts over the coming years.
Cllr Ricky Bell, COSLA Spokesperson for Resources, said: “While we acknowledge the increase in uncommitted revenue funding for 2026/27, this settlement falls far short of what is needed to sustain essential local services. Councils are facing acute and growing pressures, particularly in social care, and the current level of funding simply does not reflect the scale or complexity of demand.
“We are especially concerned by the continued underfunding of the Real Living Wage across portfolios including social care. COSLA made a clear and urgent ask for significant additional investment of £750m to protect and strengthen social care, which the Budget as announced fails to deliver.
“Further to this, the medium-term outlook paints a worrying picture for local government, with continued de-prioritisation and the prospect of significant real-terms cuts.
“If councils are to continue delivering for communities, we are calling for urgent and meaningful engagement with the Scottish Government to ensure local government is properly funded to continue delivering the essential services communities rely on every day.”
COSLA reiterated its support for the introduction of additional council tax bands as an interim step towards fundamental reform, emphasising that any changes must be taken forward in close cooperation with COSLA and local government.
In addition, it welcomed the Scottish Government’s forthcoming legislation to remove the cap on council tax premiums for second and empty homes, describing it as a positive step in providing councils with greater local flexibility.
