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Highland Council tax could rise by 10%

NHS Highland chairman David Alston.
NHS Highland chairman David Alston.

Council tax bills in the north could rise by as much as 10% as local authority chiefs battle to plug a gaping hole in the budget.

The increase was proposed by Liberal Democrat group leader David Alston yesterday after it emerged that Highland Council was facing a £46million shortfall.

Three senior councillors in the new administration said they would support breaking the seven-year council tax freeze imposed on them by Holyrood to avoid further swingeing cuts to services.

Mr Alston, who steered the authority through the first wave of global recession seven years ago in his role as budget leader, said a raise of 10% might be required to cushion the blow.

And he said the impact on north tax-payers could be softened if the Scottish Government dropped a threat to “penalise” councils if they breach its freeze.

He said: “I think it will have to be something in the region of a 7% rise to raise around £7.5million, then a further 3% on top of that to cover the Scottish Government penalty. It would help towards bridging the gap.

“We’re in an odd situation where the independent group are in administration with a clear expression of support from the SNP.

“Many of the SNP will say, privately, they think council tax should go up but will not break their party line on that.”

New council leader Margaret Davidson refused to rule out a council tax increase when she took the helm of the Independent group earlier this month.

And last members of her new independent minority administration were queuing up in support of the proposal.

Jim Crawford, Inverness, said: “I’m 100% for it. It was kept down by the SNP as a stunt, particularly in the run-up to the referendum, to make it look as though they were doing a wonderful job.

“It was nothing to do with protecting the poor, who don’t pay it anyway.

“If they want to fine us, we’ll be telling the people of the Highlands why their children aren’t going to school and why their roads can’t be repaired – it’s down to the council tax freeze.

Nairn member Michael Green said: “Seven years on, we must increase it. If the Scottish Government cares about maintaining services, this is the most obvious way.”

Tain and Easter Ross Independent Alasdair Rhind said: “I’m in favour of a reasonable council tax rise, but there are many other ways of saving money. We’ve got to look at all options.”

The extent of the financial black hole was revealed in a memo from chief executive Steve Barron to council staff and councillors on Thursday.

The cuts issue is expected to dominate next Thursday’s full council meeting when finance director Derek Yule will present a detailed update.

All eyes are on the education budget, which accounts for the lion’s share of spending.

In a baptism of fire, the department’s new chairman Drew Millar had a briefing with education director Bill Alexander yesterday before a pre-arranged quarterly meeting with teaching union representatives.

“We touched on the budget and we’re arranging a series of meetings to consider the whole situation and its possible implications on the service,” Mr Millar said.

He said he expected initial talks, involving senior administration members and council officials, would take place after the summer recess.

A spokesman for the Scottish Government said: “Local government settlements were increased to almost £10.8billion in 2014-15 and to over £10.85billion in 2015-16. Highland Council receives its fair share of this total sum which amounts to almost £496million this year.

“We have fully funded the council tax freeze since 2008-09 by providing £70million per annum.”

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