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| Scottish government U-turn over council tax schools plan | Scottish government U-turn over council tax schools plan |
| (35 minutes later) | |
| The Scottish government has performed a U-turn over plans to use the council tax to raise money for head teachers. | The Scottish government has performed a U-turn over plans to use the council tax to raise money for head teachers. |
| Instead it plans to use its own resources to give £120m of extra money to schools - £20m more than originally planned. | Instead it plans to use its own resources to give £120m of extra money to schools - £20m more than originally planned. |
| Councils had been angry at plans to use changes to the bands to create a national fund for education. | Councils had been angry at plans to use changes to the bands to create a national fund for education. |
| The money raised from the changes will stay with councils - although many still expect to make cuts. | The money raised from the changes will stay with councils - although many still expect to make cuts. |
| The government is committed to giving the extra money to head teachers to spend on schemes to raise attainment. | The government is committed to giving the extra money to head teachers to spend on schemes to raise attainment. |
| The money will be targeted at helping children from disadvantaged backgrounds - the more disadvantaged students at a school, the more money they will get. | The money will be targeted at helping children from disadvantaged backgrounds - the more disadvantaged students at a school, the more money they will get. |
| The original plan was to put the money raised by changes to the bands into a national fund. | The original plan was to put the money raised by changes to the bands into a national fund. |
| Finance Secretary Derek Mackay argued there would be no overall reduction in the amount local authorities were given from the Scottish government, with additional investment in social care. | Finance Secretary Derek Mackay argued there would be no overall reduction in the amount local authorities were given from the Scottish government, with additional investment in social care. |
| He told MSPs councils would receive: | He told MSPs councils would receive: |
| However, councils will be calculating how much money they will have at their own disposal to spend on local services. | However, councils will be calculating how much money they will have at their own disposal to spend on local services. |
| For instance, the £120m for schools is going straight to head teachers and is expected to be an additional resource. | For instance, the £120m for schools is going straight to head teachers and is expected to be an additional resource. |
| From next April, people in more highly-valued properties - Bands E, F, G and H - will pay more council tax even if their council does not put the charge up for everyone. | From next April, people in more highly-valued properties - Bands E, F, G and H - will pay more council tax even if their council does not put the charge up for everyone. |
| 'Backdoor tax' | 'Backdoor tax' |
| The multiple of the Band D charge that people in the higher-valued properties will pay is being increased. | |
| Some council areas would have received more or less back than the amount raised locally. | Some council areas would have received more or less back than the amount raised locally. |
| Relatively prosperous council areas - with a larger number of high-band properties and relatively few disadvantaged youngsters - would have subsidised areas facing bigger problems. | Relatively prosperous council areas - with a larger number of high-band properties and relatively few disadvantaged youngsters - would have subsidised areas facing bigger problems. |
| It had proved controversial. Critics claimed it was undermining the link between the council tax and local services and turning the charge into a "backdoor national education tax". | It had proved controversial. Critics claimed it was undermining the link between the council tax and local services and turning the charge into a "backdoor national education tax". |
| Each of Scotland's 32 councils should learn by Friday just how much the government proposes to give each of them. | Each of Scotland's 32 councils should learn by Friday just how much the government proposes to give each of them. |
| A total of £111m is expected to be raised from the changes to the bands. Councils will also be able to put the council tax up by as much as 3%. | |
| Labour said overall government funding for Scottish councils would fall by £327m in real terms next year. | |
| It said the amount earmarked to give to councils would drop from almost £10.10bn this year to about £9.6bn in 2017-18 - a cut of £448m. | |
| However, the budget for grants to local authorities will rise £121m, partly balancing this out. | |
| Local government organisation Cosla said the core local government settlement would fall, but recognised the government had improved on its previous offer. | |
| Cosla president David O'Neill said: "Cosla can never endorse a reduction to the core local government settlement as announced as part of the budget statement today. | |
| "It is our understanding that the Scottish government had significant additional cash for 2017-18 and therefore this decision will impact on services delivered by local government. | |
| "We fully recognise that the Scottish government has made efforts to improve the settlement through their offer of a wider package including a major change on the council tax proposals. Cosla had lobbied the Scottish government on their previous proposal and we are pleased that the Scottish government has acknowledged this." | |
| Mr O'Neill said councils would now consider the whole package as part of their budget considerations. | |
| The impact on local budgets of the changes to council tax bands will vary from area to area. The more Band E, F, G and H properties in the area, the more the council will gain revenue. | |
| As a broad rule, this means councils in relatively prosperous areas such as East Renfrewshire could benefit from these changes. | |
| However, schools in less prosperous areas are likely to gain the greatest amount of the government cash for head teachers. |