Support For Councils and Businesses
12th February 2010
Package includes extra cash for road repairs and rate savings for 60 per cent of Scottish businesses
Scottish councils are to receive a funding increase in 2010-11 to help protect frontline services despite the Westminster-imposed cut in the Scottish Budget.
Finance Secretary John Swinney today confirmed a package of support for local government and business in Scotland which includes:
* Total funding for councils in 2010-11 of almost 12 billion pounds
* Confirmation that councils will continue to receive an increasing share of the total Scottish Budget
* Five million pounds over and above the funding settlement to be shared among councils to repair damaged roads following severe cold snap
* A drop in business rates for almost 60 per cent of Scottish firms, delivering average savings of more than 1,300 pounds annually
* Help for councils to manage the costs of back claims for equal pay
Mr Swinney said:"We recognise the very real challenges faced by councils and businesses in a challenging climate. The announcements I am making today will help local authorities protect frontline services and play their part in economic recovery.
"As a result of the 2010 revaluation, almost 60 per cent of businesses will see their bills fall from April 1. Those businesses will see average savings of over 1,300 pounds, almost double the reported figure in England.
"At least half of all firms will be eligible for a discount on their bill through a total rates relief package worth 2.4 billion pounds over five years.
"We are increasing the threshold for payment of the supplement for larger businesses and for firms in rural areas, providing a vital lifeline to rural communities.
"And, following our announcement last week on raising the thresholds for the Small Business Bonus Scheme, we will extend the scheme so around 3,600 additional properties will become eligible for a discount.
"Following the agreement of the world-leading climate change Act, we are introducing a new targeted relief scheme for the renewable energy sector, offering discounts of up to 100 per cent.
"This is part of the most generous package of rates relief in the UK, worth 2.4 billion pounds over five years, providing a real boost for Scottish businesses."
Mr Swinney also urged MSPs to back the Local Government Finance (Scotland) Order 2010, which distributes money among Scotland's 32 councils.
He added:"Today's local government finance order maintains our commitment to reverse the decline in councils' share of the Scottish budget and ensures local government goes on receiving an increasing share of the overall funding available to the Scottish Government.
"Of course, the funding increase for councils would have been 174 million pounds higher had it not been for the 521 million pounds cut in the Scottish budget from Westminster. We welcome the commitment of councils agreeing to accept this share of the reduction and go on working with national government to meet our agreed commitments.
"I am also pleased that we are providing the resources for a third successive council tax freeze across Scotland, easing the strain on householders who will still be feeling the effects of these tough economic times.
"The end of the severe cold snap and subsequent thaw have presented new challenges to councils, as they seek to deal with damage on the local roads network. To help deal with the situation, the Scottish Government is allocating an additional five million pounds, to be shared equitably among councils.
"We are also helping councils spread the cost of addressing some of the challenges in settling the backlog of outstanding equal pay cases, by allowing councils to borrow over 65 million pounds. This will enable authorities to spread the costs of dealing with claims over a longer, more manageable period."
The Local Government finance Order also seeks approval for the distribution of an additional 76.9 million pounds for 2009-10, to allow councils to carry through a number of agreed spending commitments, including:
* 37.5 million pounds for the Teachers' Induction Scheme
* 15.6 million pounds for Adult Support and Protection
* Seven million pounds for the Zero Waste Fund
* Six million pounds for backdated Fire Pensions Commutations
* Three million pounds to employ 100 extra teachers
Background
Funding allocations for individual councils in 2010-11 can be found at: http://www.scotland.gov.uk/Topics/Government/local-government/17999/settlement-09-11
Business rates are paid by non-domestic properties - including shops, offices, warehouses and factories, and any other property that is not classed as domestic property. A revaluation of Non-Domestic subjects in Scotland is carried out every five years by the independent Scottish Assessors. This results in the production of new valuation rolls which contain revised rateable values for all non-domestic subjects. The principal purpose of a revaluation is to ensure that the distribution of the rates burden between ratepayers remains equitable. For further details of the 2010 revaluation see: www.scotland.gov.uk/revaluation
A key facts sheet can be viewed at: http://sh45inta/Topics/Government/local-government/17999/11199
Rateable values can be found at: www.saa.gov.uk
