Sectoral Funds (Ring Fencing)

– in the Scottish Parliament on 3rd March 2021.

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Photo of Rhoda Grant Rhoda Grant Labour

4. To ask the Scottish Government what discussions it has had regarding changing the ring-fence criteria concerning the sectoral funds distributed by local authorities. (S5O-05068)

Photo of Aileen Campbell Aileen Campbell Scottish National Party

The Scottish ministers have listened carefully to local authorities and have taken steps to replace the number of Covid-related ring-fenced funding streams.

For example, during the current financial year, councils will have complete autonomy to deploy as they see fit the additional Covid funding of £275 million that was announced on 16 February, the £120 million discretionary fund to support their local business community and the general £259 million that has been confirmed for next year.

The Scottish Government will continue to work in partnership with the Convention of Scottish Local Authorities and local authorities to ensure that our communities receive the lifeline support and services that they expect and deserve.

Photo of Rhoda Grant Rhoda Grant Labour

I wonder whether the cabinet secretary has listened to businesses, because I have raised the rigid criteria that are attached to those funds with the Scottish Government on a number of occasions. Many organisations find that they do not easily meet those criteria, and they will therefore miss the safety net that is available.

Some of those companies are paying off staff as I speak. At this late stage, will the cabinet secretary review that and hand a lifeline to companies that are folding? Those are companies that, with help, could survive and boost our economy post-Covid.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

My colleagues Kate Forbes and others, including Fiona Hyslop, have engaged regularly with local authorities and businesses about the support that should be in place to help businesses. Discretionary funding has been put in place to support the local business community and to ensure that there is autonomy for local authorities to support those businesses, which are critical to their local economies.

If the member has particular businesses that she wants to raise as an example of where the plethora of support packages do not fit businesses’ needs, I am sure that my colleagues would be really interested to know, because we want to ensure that we do all that we can to support businesses. That is why we have adapted and changed the funding to meet the needs of businesses, which we engage with regularly.

Photo of Rhoda Grant Rhoda Grant Labour

I clarify to the minister that the businesses pay harbour dues and canal dues. That is the same as paying business rates but, to date, they have not received a penny. They are folding, and they need the minister’s assistance now.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I made the offer—I think quite clearly—that, if the member has particular businesses whose plight she wants to raise, she should do so, so that we can work collectively to make sure that they get the support that they require. I think that that is a fair offer. The member has raised particular businesses with particular needs in a communities and local government question session, and I am offering to meet her or to find some ways and solutions to help to support those businesses.

Photo of James Dornan James Dornan Scottish National Party

This subject comes up fairly regularly at my Local Government and Communities Committee. Will the minister outline what changes the SNP Government has made to previous ring-fenced funding streams to provide local authorities with greater flexibility in deciding how best to allocate their total resources to services?

Photo of Aileen Campbell Aileen Campbell Scottish National Party

When the SNP came into government, we removed the vast majority of ring-fenced funding streams by removing ring fencing from the funding and adding it to the general revenue and capital grants. That reduced the total amount of ring-fenced funding by £1.8 billion. With the introduction of the pupil equity fund and the expansion of early learning and childcare, the total amount of ring-fenced funding for 2021-22 is less than 8 per cent of the total local government finance settlement.

We endeavour to continue to work with local government to ensure that it has the resources that it needs. I indicated to James Kelly just how much that means for them in terms of their day-to-day spend.

Photo of Alexander Stewart Alexander Stewart Conservative

Since 2013-14, the amount of money given to Scotland’s councils that has been ring fenced by the Scottish Government has increased by 6 per cent. That means that councils have no control over almost £800 million. Communities across Scotland have different priorities. When will the Scottish Government recognise that a one-size-fits-all approach is not working and provide the funding that is necessary to support local services and rebuild our communities?

Photo of Aileen Campbell Aileen Campbell Scottish National Party

Forgive me, Presiding Officer, but I think that, when I was in the chamber last week, the Tories were precisely proposing a one-size-fits-all approach to local government.

I set out in my response to James Dornan that, when we came into government, we reduced ring fencing, and I set out what the level of ring fencing is within the current budget. I set out to James Kelly just how much we have increased the local authorities budget settlement by. That is going through the budget process as we speak, and I set out what it means in terms of day-to-day revenue increases for local authorities.

We will continue to work with local authorities to make sure that we continue a fair and affordable settlement for them that enables them to meet the priorities of the communities that they serve.

The Presiding Officer:

Question 5 has been withdrawn.