Budget crisis puts Council services at risk

A widening budget black hole and soaring costs are threatening the future of key council services, senior officials have warned.

Rising inflation, increasing demand, and reduced funding have pushed Argyll and Bute Council into one of its most challenging financial positions in years. Essential services — from roads and waste collection to community support and education — could face cuts unless urgent action is taken.

Council leaders say they are working to close the gap but warn that “difficult decisions” now lie ahead as running costs continue to outstrip income.

“There will not be enough money next year to provide everything communities want us to, explained councillor Ross Moreland, policy lead for finance services. He added: “I am sometimes asked why there are council budget gaps every year. Very simply it’s because demand and costs for services increase, but our funding doesn’t match those increases and can go down. Just some examples of what needs funding – the council transports 3,000 school children to school every day in term time. Our school and public transport service contracts increased by £1.7 million between 2024 and 2025 alone and are expected to go up again next year. At the same time costs of transport for young people with additional support needs went up by £500,000.

“Maintaining the buildings and IT equipment for our school pupils is costing £655,000. Budget pressures will be unrelenting into next year with increases expected for example of £800,000 for schools residential accommodation for vulnerable children, £2.4 million for waste management to comply with the national landfill ban, and another £500,000 for older people services. I could go on. Communities have the chance to join us in campaigning for funding for council services in Argyll and Bute by simply saying ‘yes’ to fair funding.”

The council works through CoSLA (Convention for Scottish Local Authorities) to raise the case for funding with the Scottish Government, the main provider of funding for local government.

Estimates show the council is facing another £15 million funding gap next year, rising to £58 million over the next five years.

Council Leader, Councillor Jim Lynch, said: “We all use council services in some way every day.  There’s no getting away from the harsh fact that bridging another £15 million budget gap next year will need very difficult decisions. Tell us you support fair funding for your council services and we’ll take that feedback to CoSLA as part of campaigning for funding to sustain services.”

As well as pressure on budgets for running services, the council faces significant projects costs to improve  infrastructure.

The authority is expected to outline its full savings plan in the coming weeks, with residents being urged to engage with upcoming consultations.