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The Scottish Budget includes 2025-26 Autumn Budget Revision (ABR) to 2026-27 Budget comparisons across portfolios, including Finance and Local Government, at the request of the Finance and Public Audit Committee.

While such comparisons can provide useful context for most portfolio areas, comparing ABR to Budget for Local Government can be misleading due to the number of portfolio transfers administered at ABR or Spring Budget Revision (SBR). For example, since Budget 2026-27 was published, Parliament’s agreement to SBR will see a further £280 million of transfers into the Local Government Settlement and at least £908 million of transfers are anticipated to be processed at ABR or SBR in 2026-27.

Table 4.15 of the Scottish Budget 2026-27, ‘Revenue Funding within Other Portfolios to be Transferred In-Year’, including details of the £908 million referenced above, provides a direct like with like comparison of the Local Government Settlement in each of 2024-25, 2025-26 and 2026-27.

That table, which is unique to the Local Government Settlement, mitigates the risks acknowledged by the Scottish Parliament’s Information Centre that “that comparing portfolio allocations from the Budget to allocations from the 2025-26 ABR might be misleading” by providing a consistent comparison over time.

Table 4.15 has been included in the Budget document since 2017-18 to provide a transparent and comprehensive summary of the funding allocated in the total Local Government Settlement and then subsequently published in the relevant Local Government Finance Circular. For completeness, a full breakdown of funding that has been baselined into General Revenue or Capital Grant is also provided in Table 4.16 and this funding is restated in previous years to again ensure a like for like comparison.

An estimate of funding provided to Local Government outwith the Local Government Finance Settlement is also included in Table 4.17 of the Budget as a supporting document.

In 2025-26, the Local Government Settlement was £15,035.2 million. This was set out in Table 4.12 in the 2025-26 Budget and is repeated in Table 4.15 in the 2026-27 Budget. In 2026-27, the equivalent figure is £15,686.1 million and is published in Table 4.15 of the 2026-27 Budget. The figures in both years include all the funding planned to be transferred from other portfolios, as anticipated at the time of the budget, and the detail of those transfers is set out at the bottom of Table 4.15 in the 2026-27 Budget.

Those figures represent a cash increase of £650.9 million or 4.3 per cent. In real terms, that is equivalent to an increase of £293.7 or 2 per cent. Although the real terms figures for the Local Government Settlement are not set out in the Budget document itself, they can easily be derived from the cash figures set out in Table 4.15 and replicated using an independent real terms calculator such as that published by the Scottish Parliament’s Information Centre.

As requested by COSLA Leaders, the Scottish Budget provides local authorities with full discretion over decisions on council tax, with no freeze and no cap. With over a quarter of a billion of additional General Revenue Grant in the Settlement, the Budget should enable councils to minimise any proposed increases in council tax.

Where increases in Council Tax are necessary, the Scottish Government’s means tested Council Tax Reduction Scheme continues to protect household budgets from the impact of those changes.

I refer the member to the answer to question S6W-43271 on 6 February 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-43271 on 6 February 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-43271 on 6 February 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-43271 on 6 February 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-42760 on 16 January 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

The formula used to distribute funding between Scotland’s 32 Local Authorities is agreed with COSLA on behalf of all 32 councils each year. The formula is kept under constant review and any changes in quantum or distribution are discussed and agreed through COSLA’s formal financial governance process including the jointly attended Data Issues Working Group (DIWG) who make recommendations to the Settlement Distribution Group (SDG), who in turn make principle-based recommendations to COSLA Leaders.

SDG is a jointly chaired Scottish Government and COSLA officer group. Members are drawn from Directors of Finance across Scotland and their role is to make professional, principle-based officer recommendations. The SDG is not a decision-making body but provides evidence-based recommendations to COSLA Leaders on issues impacting the Local Government Settlement.

DIWG is a technical advisory group including representation from local authorities that exists to support the work of the SDG and to provide assurance over the quality, completeness and reliability of the data used in the formula. Where required, it provides technical advice and recommendations on the practical application of distribution and settlement issues and has a key role in making recommendations to the SDG. The DIWG is jointly administered between the Scottish Government and COSLA, with members from local authorities across Scotland who will scrutinise the merits of data sources.

It is the agreed approach of DIWG, SDG and COSLA leaders that all decisions on the funding formula be made on the basis of principle. Neither COSLA nor Councils are therefore formally advised of the impact on individual authorities as part of the recommendation process although it may be possible for council officials to estimate the impact of individual decisions.

The distribution formula considers over 140 service areas including Education, Social Care, Leisure, Roads, Waste and Housing. Further information on the funding formula can be found at the following link.

Local government finance statistics - gov.scot

The availability of the 2022 Census data for the first time has seen a number of indicators (GAEs) updated substantively in the last 18-24 months. In addition, DIWG routinely assesses the underpinning formula to ensure it most appropriately aligns funding with need.

Meaningful budget engagement with COSLA and Councils has been a cornerstone of the preparations for the Scottish Budget 2026-27. Over the summer and following extensive consultation with councils, SDG considered three papers on the indicators used to distribute funding for Personal & Nursing Care for the Elderly, Residential Care for the Elderly and Services for Home-based Elderly respectively.

Alongside the papers that were considered by the DIWG and SDG, Scottish Government officials also provided council and COSLA finance officers with a presentation on the impact of the updated indicators to ensure the issues were widely and clearly understood and have continued to support councils and respond to any questions raised throughout the process. On 16 and 18 December 2025, in line with the commitments set out in the Fiscal Framework between Scottish Government and Local Government, Scottish Government officials also provided training to council finance officials on the Local Government Settlement more generally ahead of the Scottish Budget.

The Scottish Government plays no role in providing advice to COSLA Leaders following the recommendations of SDG but at their meeting on 31 October 2026, COSLA Leaders agreed the SDG recommendations regarding the distributions for Personal and Nursing Care for the Elderly, Residential Care for the Elderly and Services for Home-based Elderly.

The changes do not involve the use of any new indicators, and so there are no new concerns around data quality or suitability. The indicators used – 2022 Population Census data, NRS death rates and population estimates, Council Tax data and DWP Pension Credit data – are those used previously, but have, as always, been updated with the latest available year’s data and are all Accredited Official Statistics.

The strengths and weakness of each variable for modelling the need for elderly social care were noted during consultation, which is one reason why a range of variables are used rather than any one indicator. While none of the variables exactly match the need for elderly social care, all having strengths and weaknesses, the six variables that continue to be used were confirmed as being suitable prior to proposals going to COSLA leaders. The revision has related to the weightings given to each indicator, which has used mathematical modelling to more accurately reflect the drivers of need-to-spend. No link to rurality was found in the modelling, however this is to be revisited during 2026.

Population Census data that are more recent than the 2011 data only became available in 2025, and this is what led to the update of the methodology this year. It was agreed by the Settlement and Distribution Group in 2015 that some 2001 Population Census data continue to be used even though 2011 data were available. Officials have therefore always been aware of this, and have continued to implement that decision.

Due to the complexity of the distribution formula, looking at individual changes in isolation can be misleading particularly given the interactions with the relevant funding floor arrangements.

To protect against funding volatility, the needs-based formula applies a main funding floor which protects councils with falling needs from the equivalent fall in funding, in line with average changes across all authorities to ensure stability over time. The formula also includes an 85% funding floor to ensure no local authority receives less than 85% of the Scottish average funding on a per capita basis.

The combined impact of all the indicators interacting is only known once the Local Government Settlement is finalised. In the meantime, in order to assist authorities in their planning, we have provided authorities with an initial estimate of the changes and the effect of the Floor. As with previous years, the provisional individual council level allocations will be set out in a Local Government Finance Circular following the publication of the Scottish Budget on 13 January.

I refer the member to the answer to question S6W-42760 on 16 January 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-42760 on 16 January 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers

I refer the member to the answer to question S6W-42760 on 16 January 2026. All answers to written Parliamentary Questions are available on the Parliament's website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers