SCOTTISH councils have warned they still have a half a billion hole in their finances relating to the pandemic for next year's budget.
Cosla, the umbrella organisation for Scottish local authorities has told MSPs that they face a £362 million black hole for revenue running costs next year – alongside a £511 million revenue shortfall relating to the impact of the pandemic.
Cosla is hopeful the Scottish Government will pass on any additional consequentials from Westminster to cover Covid-19 costs.
Finance Secretary Kate Forbes has allocated more than £11 billion to councils in next year's budget – with day-to-day revenue spending increasing by £335.6 million.
On Tuesday, Ms Forbes announced an extra "£275 million for local government for support that is needed due to pressures from Covid", after more funding was made available from Westminster.
But Cosla has warned this extra cash no impact on the core budget pressures that local authorities are facing.
In a briefing paper sent to MSPs, the organisation has stressed that "concerns around the settlement for 2021-22 remain".
READ MORE: Scottish councils 'on their knees' amid £767m pandemic bill
The document points to the year-on-year increase in core funding, but insists that the "budget reality" is that "once policy commitments are honoured" – including the Carers Act, free personal care and living wage, all pledges brought forward by ministers, the Scottish Government "is only offering an increase of £94 million (0.9%) to core funding".
Cosla has also issued a warning over £90 million as part of the draft settlement for revenue funding for councils which choose to freeze council tax next year.
The organisation has stressed that the £90 million "is equivalent to a 3% rise for the majority of councils", but has warned that "this £90 million must be baselined to avoid the need for a large rise next year".
READ MORE: Council tax frozen amid Scottish economic growth warning
Giving evidence to MSPs, Cosla's resources spokesperson, Gail Macgregor, warned that "once we dig down" into the details of the settlement, "there has not been a significant uplift in our core budget".
Pointing to the £90 million to mitigate council tax being frozen, Ms Macgregor warned that "we are obviously now being pushed down the route of having to freeze council tax and take the compensation, which—to me—is a somewhat political decision".
She added: "Our plea to the Government is that it ensures that the £90 million is baselined to ensure that our base continues as it is and we do not penalise households in the future."
The Finance Secretary said the Scottish Government funding "will contribute significantly to meeting the challenges that local government is facing".
She added: "For many local authorities, next year’s budget is more challenging, because of the on-going impact of the pandemic.
"We will work with Cosla to ensure that we understand the impact and provide funding where it is required."
READ MORE: Council leaders call for new funding model to give local authorities more power
Labour local government spokesperson, Sarah Boyack, said: “As Cosla has made abundantly clear, Kate Forbes’ budget plans mean a real terms cut to council budgets.
“After 14 years of SNP cuts and a pandemic which has hammered our local councils, it is entirely unacceptable for the SNP to continue to underfund and undervalue local government.
“The SNP’s chronic underfunding of our councils has a devastating impact on the local services upon which we all rely."
“Scottish Labour is unequivocal – we need a fair deal for councils to support them in fighting this pandemic and to protect the communities that they serve.”
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