Council tax freeze will be fully funded, says Humza Yousaf

The first minister has confirmed his plans for a council tax freeze will be fully funded by the Scottish government.

Humza Yousaf announced that council tax would remain at current levels when councils set their budgets for 2024-25.

The Scottish government had previously proposed raising council tax rates by as much as 22.5% for homes in higher bands.

Local authorities said they were not consulted before the announcement.

Speaking on BBC Breakfast, Mr Yousaf confirmed the freeze will be paid for by Holyrood.

He said: "We will make sure councils are funded by the government for that council tax freeze.

"Let's be frank with each other, we're living in a cost of living crisis.

"I, in my constituency surgeries, see people who are on above average salaries come to my constituency offices and ask for financial help. People who are nurses, who are police officers who are teachers.

"Therefore it is right that in this cost of living crisis we try to help them with bills that are rising and rising and rising. One bill we are able them to help with is the council tax."

However, local authority body Cosla said the announcement had been made without any agreement from councils.

A spokesperson for Cosla's presidential team said: "We deplore the way the announcement was made and its substance, both of which fly in the face of the Verity House Agreement which we all recently signed.

"It has been shown that previous council tax freezes have been regressive, having no impact for the poorest in society and eroding the council tax base, compounding councils' ongoing underfunding.

"We are clear that local taxation and particularly council tax should be left for democratically elected councils to determine."

Most councils in Scotland agreed to raise council tax rates in their budgets for 2023-24, with the majority increasing the amount by at least 5%.

The highest increase was in the Orkney Islands, which raised the household bill to 10%.

When asked how much funding would be provided to cover the money council tax would generate, a Scottish government spokesperson said funding decisions would be made as part of the budget in December, following discussions with local government.

Leader of Orkney Islands Council, Cllr James Stockan, said he expected the government to foot the full bill.

"We expect that if this proposed council tax freeze goes ahead then the Scottish government will cover every penny of the funds we would have raised through a 10% rise. Anything less is completely unacceptable," he said.

Councils across the country are already making difficult decisions to balance the books.

The council tax levy generates about 13% of local government funding, with most of their cash coming from Holyrood funding.

Council tax had either been either frozen or capped at 3% since the SNP came to power in 2007, with the Scottish government providing local authorities with extra funding in return.

Councils have been allowed to use new powers to set their own rates for the past two years.

Professor Richard Kerley, the co-chair of the Centre for Scottish Public Policy, said councils could go against the government's announcement.

Speaking on BBC Radio's Good Morning Scotland programme, he said: "There might be some that would say, we're not going to do this, don't give us the money, we'll increase council tax.

"Whether they are willing to do that is another matter. But it is very clear that it's caused upset for local government, including in many cases SNP members who are councillors in local government, office holders in their councils and in Cosla."