COUNCIL officers are forecasting a budget gap of more than £5 million in Argyll and Bute in 2027/28 – after potential increases to council tax and fees and charges.
A report has also revealed that the authority is projecting a total gap of over £39m between the next financial year and 2031/32.
Officials have made the calculations having factored in a theoretical five per cent council tax increase, and a six per cent increase in fees and charges.
A report on the projected budget gap will go before the council’s policy and resources committee at its meeting on Thursday, October 15.
Executive director Kirsty Flanagan said: “In 2026/27, a general inflationary increase of six per cent was applied to relevant fees and charges.
“For the budget outlook, a range of between three per cent (worst case) and nine per cent (best case), with a mid-range of six per cent continues to be assumed each year over the five years 2027/28 to 2031/32.
“In terms of council tax, a five per cent increase continues to be assumed each year in all scenarios.
“The average increase in council tax across all Scottish councils in 2026/27 was 7.78 per cent, with 16 increasing theirs by at least eight per cent.
“With a focus on longer term financial sustainability and in light of the significant forecast budget gap over the next five years, the level of council tax increases in 2027/28 and in future years will require due consideration by members, as part of the budget setting for 2027/28 and future years.”
Council tax was increased by 9.7 per cent in Argyll and Bute in 2026/27, following a 9.9 per cent increase in 2025/26.
Ms Flanagan added: “In the mid-range scenario, the budget gap is now estimated at £5.011m in 2027/28 and £39.175m over the five year period 2027/28 to 2031/32.
“Council officers are continuing to explore budget savings options during 2026/27 and these will be presented to members in due course.
“This is a very challenging budget outlook position. Variations to the assumptions, particularly in respect of future Scottish Government grant funding levels, the pay award and the financial impact of the conflict in Iran would have a significant impact on the budget outlook.
“There are also some known future pressures that are not quantifiable at this stage therefore are not included within this position.
“All assumptions will be kept under review, with the budget outlook updated, as and when further information becomes available.”
The council will set its budget for the 2027/28 financial year in February.
