Scottish Local Government Financial Statistics: 2015-16

Scotland’s Chief Statistician today published Scottish Local Government Financial Statistics: 2015-16. This is an annual publication that provides a comprehensive overview of financial activity of Scottish local authorities based on their final, audited accounts.  The publication covers: local authority revenue expenditure and income, capital expenditure and income; reserves; debt; local taxation; and local authority pensions. The figures released today were produced by independent statistical staff free from any political interference, in accordance with professional standards set out in the Code of Practice for Official Statistics.

Revenue Expenditure and Income

Scottish local authorities reported an overall revenue surplus on the provision of services of £0.45 billion (2.7% of total revenue expenditure) at 31st March 2016.  Of this surplus, £0.34 billion was transferred to the Capital Fund to be used for Capital expenditure and £0.03 billion was transferred to other reserves (e.g. Insurance Fund), the remaining £0.07 billion contributed to General Fund and HRA reserves.

Gross revenue expenditure on services was £15.3 billion in 2015-16, up 0.7% on 2014-15.  Of this, £0.66 billion, up 0.7% on 2014-15, of expenditure relates to the provision of housing through the Housing Revenue Account (HRA) and £14.7 billion, up 0.7% on 2014-15, relates to the General Fund.

Net revenue expenditure on services was £10.1 billion in 2015-16, up 0.7% on 2014-15.  The highest spending service in the General Fund is education which had net expenditure of £4.7 billion (45% of General Fund net revenue expenditure).  Social Work is the next largest service with net expenditure of £3.2 billion (30%).

Finance and investment net expenditure (interest and debt repayments net of investment income) was £1.5 billion in 2015-16, up 2.5% on 2014-15. 

Total General Funding in 2015-16 was £12.0 billion.  This is made up of Scottish Government General Revenue Grant £7.1 billion (60%), Non Domestic Rates £2.8 billion (23%), Council tax £2.1 billion (17%), and other funding of £0.001 billion (rounds to 0%).

Council Tax

The average Band D Council Tax in Scotland was £1,149 in 2015-16. Council Tax income was £2.05 billion in 2015-16 (after Council Tax Reduction).

The total number of chargeable dwellings (i.e. the tax base) has increased slightly each year, rising from 2.39 million in September 2011 to 2.46 million in September 2016.

Non-domestic Rates

Non-domestic rates bills are calculated using the rateable value (RV) of a non-domestic property, multiplied by the poundage rate (48.0p in 2015-16) plus any relevant supplements (such as Large Business Supplement), less any rates reliefs.

Non-domestic rate income collected increased from £2.511 billion in 2014-15 to £2.579 billion in 2015-16. This is due to the net effect of several factors such as the inflationary increase in the poundage rate, the impact of revaluation appeals, changes to rates relief schemes and other changes to the tax base (e.g. new or demolished properties).

Non-domestic rates reliefs provided relief of £0.626 billion in 2015-16, up from £0.607 billion in 2014-15. Increases in Small Business Bonus Scheme and Charity relief were the main factors which contributed to the increased total.

As at 1st April 2016, the non-domestic rate tax base comprised of 225,259 non-domestic properties on the Valuation Roll with a total rateable value of £6.796 billion.

Reserves

On 1 April 2015 local authorities had total revenue reserves of £1.84 billion; over the course of the year this increased by £0.05 billion (2.6%) to stand at £1.89 billion on 31st March 2016. Capital reserves increased by £0.1 billion (18.3%), from £0.53 billion at the 1st April 2015 to £0.63 billion at the 31st March 2016.

Capital Expenditure

Total capital expenditure was £2.54 billion in 2015-16 (£0.64 billion in the HRA and £1.89 billion in the General Fund), compared to £2.40 billion in 2014-15 – an increase of 5.6%.  The majority (83%) of capital expenditure went on new construction, conversions and enhancements to existing buildings.

Loans Fund Borrowing

The total value of Loans Fund advances outstanding at 31st March 2016 was £13.41 billion (of which £10.05 billion was General Fund and £3.36 billion was HRA). General Fund Loans Fund advances outstanding increased by £0.09 billion (0.9%) between 31st March 2015 and 31st March 2016. HRA loans fund advances outstanding rose by £0.14 billion (4.5%) between 31st March 2015 and 31st March 2016. At 31st March 2016, the Scottish average General Fund loans fund advances outstanding was equal to £1,870 per person, up 0.4% on 31st March 2015, and the average HRA loans fund advances outstanding was equal to £10,609 per HRA dwelling, up 4.6% on 31st March 2015.

Assets

The total value of assets held by local authorities at 31st March 2016 was £40.7 billion.  This is an increase of 3.3% (£1.29 billion) since 31st March 2015.  The vast majority of the assets were operational assets (£39.1 billion, 96% of total assets), including £11.3 billion of council dwellings (28% of total assets) and £19.0 billion (47%) of other land and buildings.

Background 

• The full Scottish Local Government Financial Statistics 2015-16 publication

Definitions:

• GROSS REVENUE EXPENDITURE is the total expenditure on Local Authority services within a financial year less inter-authority and inter-account transfers.
• NET REVENUE EXPENDITURE is the element of expenditure on services to be funded by taxation and non-specific grant income (i.e. General Revenue Grant, Council Tax and Non-Domestic Rates), with any remaining expenditure to be met from reserves.
• CAPITAL EXPENDITURE is mainly incurred by Local Authorities for buying, constructing or enhancing physical assets such as buildings (schools, houses etc.), land, vehicles, plant and machinery.
• CAPITAL INCOME comprises of Government grants, receipts from the sale or disposal of assets and other grants and contributions.

Further information on Scottish Local Government Finance Statistics

Each year, the Scottish Government issues financial returns relating to local government finance for completion by Local Authorities, Valuation Joint boards, Regional Transport Partnerships (RTPs) and Bridge Authorities. Summary information is published in the annual publication: “Scottish Local Government Finance Statistics”.  The information is used to answer requests (both internal and external to SG), for policy analysis and for Parliamentary Questions.

The figures released today were produced in accordance with professional standards set out in the Code of Practice for Official Statistics.