Mr Mackay says the parliament has looked at the council tax but there is no majority for an alternative.

"I'll work with anyone" who wants to take this forward, he adds.

Consensus is important to ensure stability, the finance secretary insists.

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Scottish Green Party co-convener Patrick Harvie says it is clear in the face of rising demand for local services, councils need the power to raise the funds to meet that demand.

Why was there no word from Derek Mackay about the reform of local taxation, asks Mr Harvie.

He asks what will the government be doing to give real effect to the urgent need for local tax reform.

BBC Scotland's business and economy editor Douglas Fraser tells the Politics Scotland programme that the key decision in the Scottish budget was the signals sent by "freezing" the level at which people start to pay the higher rate of income tax.

In Scotland the higher rate of 41% comes in at just above £43,430.

Douglas Fraser says that opens up a gap with the level in England and Wales which is £50,000.

He says the finance secretary is "very aware of the risks" of the strategy.

On spending, Douglas Fraser says health will get a large chunk, which was expected.

The local council budget and education budget will get an increase, but he suspects a lot will be ring-fenced for specific projects.

The finance secretary says the Scottish government has been safeguarding Scotland while Scottish Labour has been selling Scotland out.

"How about we get rid of Tories pernicious policies by removing the Tory government," he says.

Mr Mackay insists the Scottish government is taking an approach to welfare "with dignity and respect at its heart".

He criticised Scottish Labour for not bringing forward an alternative budget.

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Labour MSP James Kelly says public services are at "breaking point" and teachers are writing to parents about unprecedented cuts.

He also highlights child poverty and the trains.

Mr Kelly insists: "This is yet another woeful SNP budget.

"Scotland has been let down by Nicola Sturgeon's timid government and Derek Mackay's timid budget."

He calls for a "radical budget" to help local councils who are struggling.

Mr Kelly says the SNP has refused to use its powers to put an end to the "vile" two child cap policy.

He adds that the cabinet secretary should have backed calls to increase child benefit by £5 a week.

"That was an offer I'd like to refuse," responds Mr Mackay.

He insists the UK budget sets a real-terms reduction to the Scottish budget.

The Scottish economy is outperforming the UK economy Mr Mackay insists.

If I was to follow the Tory tax plans, I would need to cut public services be £0.5bn he says.

The finance secretary says Scotland is the lowest and fairer taxed parts of the UK, before pointing to criticism of the UK government's handling of Brexit from business community representatives.

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Tory MSP Murdo Fraser says the Scottish block grant is increasing by £950m.

Mr Fraser says businesses asked that the tax differential would not increase in Scotland.

He adds someone earning £43,430 and 50,000 will face a marginal tax rate of 53% on every extra pound that they earn.

He says the headline sum for local services announced today falls short of the £1bn Cosla have called for.

"This is a pay more get less budget."

The package for social care and integration is being increased to more than £700m, Mr Mackay says.

On local government, he says funding will increase to £11.1bn.

This is a real terms increase in revenue and capital funding for councils, he adds.

Mr Mackay says if other parties want to increase spending in any area, they must indicate where this money should come from.

Should it come from a rise in income tax, hitting the lowest earnings, or should it come from a cut in public services he asks.

"The decisions we've taken in this budget ensure we protect what matters most."

Mr Mackay says at a time of constrained growth as a result of a "failed UK government, now is not the time to cut tax".

The finance secretary insists the health service will get all of the money it was promised.

"The UK government left us £55m short in terms of health funding", says Mr Mackay.

The finance secretary says he will continue to work to establish a Scottish National Investment Bank.

Our package of business rates relief is the most generous of anywhere in the UK, worth £750m in 2019-20 he insists.

On non-domestic rates, Mr Mackay confirms an out-of-town levy will not be brought in, but a £50m capital fund to support town centres will be set up.

Income tax rates will remain the same as last year, he confirms, meaning 99% of all taxpayers will see no increase.

But the starter and lower rate threshold will be increased by inflation, to protect the lowest earners he says.

The higher rate threshold will be frozen.