27th February 2026
The Highland Council will meet on Thursday 5 March to consider a three-year financial plan, which sets out recommendations to deliver a balanced budget, alongside additional investment in adult social care, housing, education, workforce development, and roads.
The report outlines the challenges and opportunities faced by the Council alongside the administration's budget proposals, which, if agreed, would see:
A 7% increase in Council Tax - 5% to support the delivery of vital Council services, plus 2% to support the Highland Investment Plan, a £2.1 billion, 20-year capital investment programme to deliver improvements in schools, local infrastructure and services.
£12.2 million of new investment to strengthen key services and support.
A £61 million package of budget savings, income generation proposals and financial flexibilities designed to close a £46.7 million budget gap over the next three years. This includes an increase in Council Tax on second homes and long-term empty properties to support the Highland Housing Challenge.
Budget consultation took place with community councils, business groups, young people, and members of the public at the end of last year.
Leader of the Council, Cllr Raymond Bremner, said: "The administration is proposing a budget which increases income, directs support to those who need it, and delivers investment and sustainable growth across our communities. Through our Highland Investment Plan, we will deliver long-term capital improvements to our school estate and local infrastructure.
Alongside this, a balanced package of savings and income generation measures will enable continued investment in the services people care about most, including adult social care, housing, and workforce development, as well as targeted support for young people and families experiencing poverty or barriers to learning.
"I'm particularly proud to bring forward a budget which includes a recurring £1 million grant and loan scheme to incentivise owners of long-term empty properties to bring them back into use as principal homes, helping to improve housing availability in local communities. A proposal to provide £7 million of additional investment to support the change and transformation work required in adult social care to develop a sustainable model, will also help ensure people can live independently in their own homes as long as possible."
Convener of the Council, Cllr Bill Lobban, said: "Councils continue to operate in a challenging financial environment, with significant pressures associated with the costs of delivering services, pay awards, inflation, and interest rates. We have taken a proactive approach to meeting this challenge - moving from a £108 million budget gap three years ago to becoming one of Scotland's most effective local authorities when it comes to managing financial pressures, increasing income, and diversifying revenue streams, without relying on reserves to balance budgets. While the Scottish Government grant funding to Highland Council in 26/27 represents a small cash increase, it is unlikely to be repeated in future years and falls short of what COSLA asked for to meet service demand. This makes our robust approach to financial management, transformation, and long-term planning, which has been recognised by Audit Scotland, even more critical."
The budget report and administration proposals are now available.
Administration budget proposals:
Council Tax proposals:
A 7% increase in Council Tax, taking the average Council Tax payment (Band D) to £1633.99 per year - 5% to support delivery of vital Council services like education, housing, roads, and social care, and 2% set aside to support The Highland Investment Plan (HIP), a £2.1 billion, 20-year capital investment programme to deliver improvements to local infrastructure and services.
A key element of the HIP is the creation of community hubs, known as Points of Delivery (PoDs), supporting a move towards a single public estate incorporating schools, offices, depots and partners, creating more integrated community-based facilities. Projects in the early development stages include: Beauly Primary PoD, Charleston Academy PoD, Dingwall Primary PoD including St Clement's, Fortrose Academy PoD, Inverness High School PoD, Thurso PoD, and Tornagrain Primary PoD.
Up to £15 million in revenue income from Council Tax over the next three years will be used to support £350 million capital investment over the next five years through the HIP.
Increase Council Tax on Second Homes and Long-Term Empty Homes (currently charged at 200% - 25/26) to 250% (Long Term Empties) and 300% (Second Homes) in 26/27. This additional income would support the Highland Housing Challenge, with 24,000 new homes required over the next 10 years to meet housing demand.
There are just under 9000 people on the Highland Housing Register seeking a new home. The Council has 3,369 second homes and 2,466 long-term empty properties. The Council has notably more second homes and long-term empty properties than any other local authority in Scotland. For long-term empty properties, 41% have been empty for more than 3 years.
Saving proposals:
A £61 million package of savings, income generation proposals and financial flexibilities designed to close a £46.7 million budget gap over the next three years and support investment proposals. This includes £19.3 million of previously agreed proposals, and £41.7 million of new proposals.
Investment proposals:
£12.2 million of new investment to strengthen key services and support for people who need it most. This includes new investment for roads, housing, support for children and families experiencing poverty or barriers to learning, public toilets, workforce development, reuse and repair community projects, and adult social care. (totalling £12.2 million - £3.5 million recurring and £8.5 million non-recurring). This adds to previously agreed investment in education, additional support needs, countryside access rangers, ecology strategy and amenities, and improving care and respite (totalling £4.5 million).
Recurring investment proposals:
£1 million to support the Highland Housing Challenge, funded through income generated by Council Tax levied on second homes and long-term empty properties. This would fund a grant and loan scheme to encourage owners of long term empty properties to bring them back into occupation as principal homes, improve the availability of housing within local communities, and reduce the negative impacts associated with empty or under-used properties.
£500,000 to support recommendations for action identified by the Highland Poverty and Equality Commission, which was established by the Council in 2025 to consider how poverty affects families in Highland and how service delivery need to change to address poverty-related issues. Recommendations are due to be published this summer.
£500,000 additional investment to support roads maintenance costs.
£500,000 to support the Council's Future Operating Model, which aims to improve service delivery, embed sustainable ways of work, and make better use of digital technology. The model aims to drive efficiencies through closer collaboration across the Council and with external partners, while supporting more resilient and empowered communities. The investment will be used to introduce mobile services across rural communities providing housing, benefits and service support, and training, alongside partners in the public and third sector.
£406,000 increased budget for Pupil Equity Funding, including a 2% top up, which provides funding for schools to support children experiencing poverty and barriers to learning through literacy, numeracy and wellbeing initiatives.
Other local community investments include increased funding for ward discretionary budgets (£105,000), public toilets (£72,000), and community councils (£55,000).
Non-recurring investment proposals:
An additional £7 million spend on adult social care in 26/27 to support change and transformation as part of a Models of Integration review. NHS Highland currently has responsibility for adult health and social care services, and Highland Council has responsibility for children's health and social care services. Total revenue funding in adult social care will be £156.2 million in 26/27.
£300,000 additional investment for the Repair the Highland Fund, which supports reuse and repair community projects, building on the £500,000 investment in 2025/26.
Combination of recurring and non-recurring:
£1.6 million investment to create a Workforce North Co-investment Fund in partnership with Skills Development Scotland. This includes a one-off investment of £1.2 million in 26/27 and £406,000 of recurring investment. This will support regional plans for workforce development to address skills shortages and improve access to opportunity, with a focus on workforce support, school/employer partnerships and employability and skills development. This includes the expansion of Foundation and Modern Apprenticeships.
The agenda for 5 March and link to full report
The full paper is 165 Pages as a Pdf