After the SNP won its first Holyrood election in 2007, foolish council leaders across Scotland rushed to sign up to what then finance secretary John Swinney described as a ‘historic concordat’. In return for Swinney pulling back from his threat to centralise education, Scotland’s 32 local authorities agreed to uphold the nationalists’ promise to freeze council tax rates. Lots of councillors swanked about, bragging about this brilliant deal. Look at us, they said, we’ve got a ‘historic concordat’.
It appears that Yousaf has announced a flagship policy that he is simply unable to cost.
And then reality slapped them across their faces. Swinney had stitched them up good and proper. The ‘historic concordat’ was worth less than the paper it was written on. The increased autonomy meant councillors were now responsible for the downsides of the council tax freeze.
For nine years — until 2016 — council tax rates remained unchanged across Scotland. The impact on local services was devastating. Departments had to scramble to find massive economies. For all the SNP’s talk of being a uniquely progressive party, it presided over an agreement which saw the most vulnerable hit hardest. And when opponents criticised, SNP ministers pointed the finger of blame at councils.
The nine-year council tax freeze had a devastating impact and yet it will be reactivated. During his keynote speech to SNP conference in Aberdeen on Tuesday afternoon, First Minister Humza Yousaf announced the local tax will remain at the current level when councils set their budgets for the year 2024-25 (it is pure coincidence, I’m sure, that there’s a Holyrood election in 2026).
Delegates at SNP conference cheered Yousaf’s announcement, which represented quite the change of direction for the Scottish government — which has previously proposed increasing council tax by as much as 22.5 per cent for homes in the highest bands.
Yousaf framed his announcement as part of his government’s effort to ameliorate the impact of the cost-of-living crisis on Scots. But he has no idea what price for this might be. The UK government has not yet settled on a figure for the block grant to be transferred from Westminster to Holyrood next year. And, until that figure is known, the Scottish government doesn’t know how much money it will be able to make available to councils and, therefore, how much more it will have to hand over in order to fund the council tax freeze. It appears that Yousaf has announced a flagship policy that he is simply unable to cost.
Oh, and then there’s the not inconsiderable matter of a warning, in advance of the council tax announcement, from the Scottish Fiscal Commission (Scotland’s official independent economic forecaster) that Yousaf’s government faces a £1 billion black hole in 2024-25.
Unsurprisingly the SNP’s partners in government, the Scottish Greens, are unhappy with the council tax freeze, about which they knew nothing until Tuesday morning. The Greens’ finance spokesman Ross Greer said the policy will favour the rich over the poor, adding that his party was concerned about the effect the freeze could have on ‘already-strained frontline public services if it is not properly funded’.
And there’s been a furious reaction from Cosla, the umbrella body for Scottish Councils, which has demanded an emergency meeting with Yousaf. After an emergency meeting on Wednesday morning, a spokesman for the organisation said:
The announcement of a council tax freeze as we said yesterday was made completely without reference to local government and there is no agreement to freeze council tax next year… Our cross-party group leaders held an emergency meeting first thing this morning on the back of the announcement and there is real anger at the way this has been handled and what it puts at risk…
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.
There is nothing new about the SNP devising policies which benefit the wealthy and then marketing them as progressive. The ‘free’ prescriptions policy is, in reality, the extension of the removal of charges to the better off. Those in financial need were already excused from paying for medicines.
And the trumpeted removal of tuition fees has, in part, been made possible by cuts to colleges which are more likely to be attended by young people from less wealthy backgrounds. This new council tax freeze looks very much like a panic-driven move by an SNP leader under pressure from a resurgent Scottish Labour party.
Whether Yousaf will one day look back with pride on a policy that stands to hammer council services in the run up to the next Scottish election is, at the very least, debatable. Scottish Labour is quite happy to watch Humza Yousaf squirm. ‘The First Minister,’ said one Labour source, ‘has abandoned any pretence that he’s a progressive politician.’
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