Current status: Answered by Ivan McKee on 12 March 2025
To ask the Scottish Government whether it excludes the funding for any local authorities for the purposes of calculating average per person funding for local authorities as part of the policy, as stated in the Scottish Public Finance Manual, that each local authority receives at least 85% of the Scottish average revenue funding per head, and, if so, which local authorities; when they were first excluded, and for what reason.
The 85% funding floor is a key element of the needs-based distribution formula that is discussed and agreed with COSLA on behalf of all 32 local authorities each year.
Funding for all local authorities in Scotland is included in the calculation of the 85% Floor although the contribution of the three island councils and Argyll and Bute to the average calculation, is capped at 115%.
The capping adjustment has no effect on funding actually provided to those four authorities and it only applies for the purpose of calculating the average, in part to mitigate the risk that the Special Islands Needs Allowance (SINA) has a distortive impact on the calculation.
The capping adjustment has been in place since the 85% Floor was introduced in the 2012-13 Settlement (see Annex I of Local Government Finance Circular 11/2011).