Operation of the 1% target for Local Authorities
In October 2017, a framework was developed and agreed by the Scottish Government and COSLA, stating that at least 1% of local government budgets would be subject to participatory budgeting by the end of 2020/21. This agreement, and the associated timeline for implementation, have subsequently been revised to recognise the impact of the COVID-19 pandemic upon local government, people and communities.
The 1% target is calculated with reference to the element of councils’ net expenditure requirement that is met other than from Council Tax which is seen already to be a directly- and locally-accountable tax. In the Council’s case, this annual target equates to around £8.2m, based on the Local Government Finance Settlement for 2021/22. While calculated with reference to revenue funding, both revenue and capital expenditure can contribute towards meeting the target.
It is important to emphasise that PB focuses first and foremost on how, rather than where, available funding is spent and, as such, is not about identifying a separate and/or additional resource. There are, however, some areas of expenditure that cannot be influenced or changed by public choices, such as historic borrowing costs and sums linked to pre-existing contracts.
During 2020/21, most planned PB activity across councils was directly impacted by the work needed to respond to the pandemic, resulting in delays in meeting the target. Whilst the joint commitment between the Scottish Government and councils in allocating at least 1% via PB firmly remains, there is now a degree of flexibility available to councils as to when they can practicably meet it. The Council will consider, within its own local context, how and when the target will be met and report regularly to elected members and communities on its progress.