Glasgow City Council faces £119m budget shortfall as inflation soars

Glasgow City Council has published its financial forecast or next year

Glasgow City Council is facing a budget shortfall of £119.4m, with soaring inflation expected to account for almost three-quarters of that total.

The local authority released the figures in its financial forecast for 2023-24.

The forecast will be used for budget proposals to be considered next year.

Increased utility costs, pay deals for workers and rental fees for newly sold-off buildings are also expected to contribute to the shortfall.

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The financial report, prepared by the council's executive director of finance Martin Booth, predicts inflation will account for £87.2 million of the deficit.

Some £80.1m of that total is expected to come from pay inflation, with officials anticipating next year's pay settlement for workers to increase.

Extra Scottish government funding which was provided to help settle this year's pay dispute with council workers has also been deducted from the 2023-24 forecast.

The next largest cost is made up of budget pressures such as rising utility costs and "the revenue consequences of capital investment".

That figures include a £11.7m rental cost of operational buildings which have been sold by the council to settle equal pay claims.

Properties valued at about £200m – including the Kelvingrove Museum and Art Galleries and City Chambers – are being sold to a council-owned property firm, which then leases them back.

Kelvingrove Museum and Art Galleries is among the properties being sold off by the council

The financial report assumes no increase in council tax, as that decision will be taken at the council's budget meeting, and no increases in spending.

Glasgow City Council was among several local authorities to raise council tax by 3% in 2022 after a freeze was lifted.

The forecast will be used by councillors to prepare budgets to be considered in February or March.

Meanwhile, officers will present options to the council's cross-party budget working group. The council says no decisions on options will be taken before the council's budget meeting.