Council tax frozen for seventh year in a row

Scotland's council tax will remain frozen for the seventh year running, John Swinney has confirmed.

In a statement to the Scottish parliament, the finance secretary said £10.6bn would be given to local authorities to fund services in 2014-15.

Mr Swinney told MSPs he was "shielding local communities" from UK government cuts.

However, Scottish Labour said the freeze had led to cuts in services.

Council tax bills in Scotland have been frozen since 2007 under an agreement between the Scottish government and local authorities.

As part of the package, councils will receive an extra £80m to fund the additional cost of childcare provision for three and four year olds, increasing the number of hours per child from 475 to 600 a year.

Mr Swinney also announced that £40m will be ring-fenced over the next two years for councils to mitigate the impact of the so-called bedroom tax, which was introduced by the UK government.

He defended the council tax freeze, saying the funding package would ensure Scotland's councils were "fairly funded".

He told MSPs at Holyrood: "Local government provides a wide range of services and plays a major role in local partnerships that are essential to the delivery of the services that matter to the people of Scotland.

"The allocations include resources to enable local authorities to continue to freeze their council tax, which is an important measure to protect household incomes in Scotland.

"This settlement of almost £10.6bn comes at a time when, as a result of Westminster's austerity agenda, our spending power has been cut by around 11.1% in real terms between 2010-16."

'Underfunded'

However, Scottish Labour's local government spokeswoman Sarah Boyack attacked Mr Swinney for continuing to freeze the council tax, saying the "prolonged" policy had led to reduced levels of service and job cuts.

She added: "The SNP have broken local authority finance through their sustained and underfunded council tax freeze that actually costs people more money as charges to deliver services are increased to provide vital funds.

"Since 2008 almost 35,000 jobs have been lost within councils as the SNP continue to grasp power back from local authorities.

"Under the SNP's prolonged, underfunded council tax freeze the rich prosper and those who most need the support of councils lose out."

Elsewhere, Mr Swinney announced a cap on the annual rate of business rates poundage at 2%, and said a scheme to help small firms with their business premises costs would be extended to 4000 more premises.

Scottish Conservative finance spokesman Gavin Brown MSP urged the Scottish government to adopt more business-friendly policies.

He said: "We want the Scottish government to help businesses here by lowering business rates, giving retailers a much-needed boost, scrapping the Scotland-only retail levy and reversing the damaging changes to empty property tax."