The SNP’s finance secretary is facing claims that he used a “double counting con” to back up his claim that he signed off on a multimillion-pound boost for council services.
Two respected independent bodies said that Derek Mackay used cash already counted in the health service’s budget and assumed every town hall would impose the maximum increase to council tax, to justify his argument that local government services will see a £240 million-plus increase next year.
A debate over local authority services — and whether they are in line to receive spending increases or cuts — has continued since Mr Mackay set out his draft budget last week.
The Fraser of Allander Institute, hailed by Mr Mackay as “independent experts” days ago, described his method of counting money twice in different areas of the budget as “highly controversial”.
Murdo Fraser, finance spokesman for the Scottish Tories, said that the government had “shamefully spun fiddled figures”. He added: “Dodgy Derek’s double counting con has been found out. In short, the finance secretary has signed off on the kind of creative accountancy that would make Fred Goodwin blush.”
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The new analysis showed extra cash allocated for health and social care integration had been included in sections of the budget outlining health spending, while also being used in a table, named “other sources of support”, apparently giving a breakdown of council budgets.
Experts said that as health and social care is delivered in partnership by both the NHS and councils, it would have been justified to include some of the cash in either table.
But it should not have all been used in both.
The Fraser of Allander Institute said: “The inclusion of health and social care monies in ‘local services’ is highly controversial. The funding for this actually already appears in the health budget lines — indeed, it is fundamental to the government’s commitment to increase the health budget in real terms.
“But the government often double counts this as spending on local services. Clearly this isn’t right, it either has to be one or the other . . . You cannot have it both ways.”
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Impartial researchers at Holyrood also alluded to double counting in analysis published yesterday. They said: “Other sources of support includes funding for health and social care integration, and additional income expected from council tax reform. But, the money for health and social care integration is already included in the health budget totals, and therefore contributes to the real-terms growth in the health budget.”
Compared with this year’s final budget, the Scottish parliament information service said that councils would see a cut of £327 million in central grants and non-domestic rates income, or £166.2 million when compared with the draft budget.
It is only when the cash already allocated to health, as well as maximum possible income from council tax rises which town halls may not implement, is factored in that the government can suggest spending is rising. Even then, the claim only works when comparing figures to this year’s draft budget, rather than the most up-to-date version.
Meanwhile, Scottish Labour said that Mr Mackay’s budget had descended into farce after the government was forced to revise proposed funding allocations to councils.
The party said that figures sent out on Thursday were revised over the weekend, with Aberdeen council originally promised more that £2 million more and Edinburgh Council £7.9 million more than they should have been.
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Alex Rowley, the Scottish Labour party’s deputy leader, said: “The SNP’s budget has now become a total shambles. If the UK government had acted as incompetently when allocating funding to Holyrood the Nationalists would have cried betrayal.”
A Scottish government spokesman said that the draft budget, in addition to the power to raise council tax by up to three per cent, would “confer additional spending power to support local government services of £241 million or 2.3 per cent based on the local government finance settlement presentation.”
He added: “In addition to their core grant, councils will receive their share of £120 million for schools, £107 million for social care and £111 million in additional revenue from reform of council tax bands.”