Argyll and Bute Council would have to raise council tax by 8.9% to balance budget

Argyll and Bute Council will have to raise council tax by 8.9% to have a balanced budget in 2025/26, a report has said.

The authority will set its budget for the coming financial year on Thursday, February 27, with a gap of £14.9m being projected prior to implementing any savings options.

The report estimates that the figure will reduce to £2.4m based on increased fees and charges, savings options, and an indicative 5% council tax increase.

However, the figure after those measures is reported as part of the council’s budget surveying exercise to be £6.4m.

The council initially increased council tax by 10% for the 2024/25 financial year, going against a pledge by then first minister Humza Yousaf that the charge would be frozen.

However, it did later freeze council tax after additional funding became available. The administration of the council then changed hands in April.

The budgeting pack has now been published ahead of a meeting of the council’s policy and resources committee on Thursday, February 20.

The report said: “The setting of council tax should happen on the same day as the council sets its revenue budget as once all proposals are considered, council tax is the balancing figure.

“The gap outlined in [the report] is based on a 5% council tax increase (this is the assumption that has been in the budget outlook during the year).

“In order to get to a balanced budget, council will need to increase council tax to 8.9 per cent (sic).

“The alternative to increasing council tax further is that council would need to fund the gap using reserves or other funds held, which would be a one-off fix, however, members need to be mindful of the significant gap in future years as well as the pressures facing the capital plan.”

The report added: “All proposals included within this report result in a balanced budget for 2025/26.

“There remains a significant budget gap in future years, and officers will continue to explore options to generate future savings or additional income.”