Midlothian Council faces £4.5m budget gap

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Midlothian Council has been dealt a New Year blow as it battles to protect services while bridging a £4.5 million gap in its budget for 2016-17.

But opposition councillors say the budget deficit is nearer £7m if inflation is taken into account.

The local authority is expected to receive £150.517m from the Scottish Government’s Local Government settlement.

Deputy First Minister John Swinney announced that local government revenues would be cut by 3.5 per cent for 2016-17. The funding package announcement sees council tax frozen for a further year.

The council was already facing a £1.852m budget gap for the coming financial year.

Council leader Catherine Johnstone (SNP) said: “We are still working through the details of the announcement and the impact on Midlothian.

“The initial assessment is that the grant we will receive next year will be £150.6m, some £4.5m less than we anticipated and so we have a significantly larger budget gap to address than previously reported.

“This is a hugely challenging time for us as we need to agree a balanced budget by February, so there’s very little time to make decisions.

“We’re looking at various options to address the shortfall and with time of the essence, there’s not going to be much opportunity to consult on any cuts required.”

Councillor Derek Milligan (Lab) said: “It is a £4.5m cut but when you take in inflation, wage rises and other responsibilities that the government has given us it is nearer £7m worth of cuts.”

He said it was his understanding that all council divisions had been asked to find £2m worth of savings ahead of the budget being set by the end of March.

“I think it is disgusting. This just can’t simply continue until core services the public tell us quite clearly they want, are going to disappear altogether. I hope we don’t hear this was Westminster’s fault.

“If we had been allowed just a meagre inflation – only an increase in council tax – we wouldn’t have to take this drastic action. This is solely down to the Scottish Government,” he added.

Councillor Ian Baxter (Green) said: “This is a swingeing attack on local government services by John Swinney and this time he can’t simply blame it on Westminster.

“We need to end the council tax freeze; it hands to the richest homeowners three times what it saves the least well off, whereas the poorest rely most on council services which are now going to be severely hit.

“Councils are not allowed to borrow, they cannot raise council tax and now their government funding is being decimated. I really fear that the cuts to services coming down the line are going to hurt a lot.”