Joint Working Group on Sources of Local Government Funding and Council Tax Reform minutes: 18 April 2024

Attendees and apologies

Core membership attendees:

• Cllr Shona Morrison, Convention of Scottish Local Authorities (COSLA) President (Chair) 
• Cllr Steven Heddle, COSLA Vice-President 
• Tom Arthur MSP, Minister for Public Finance, Planning and Community Wealth 
• Patrick Harvie MSP, Minister for Zero Carbon Buildings, Active Travel and Tenants’ Rights 
• Joe FitzPatrick MSP, Minister for Local Government Empowerment and Planning 
• Robert Emmott, Local Authority Director of Finance Group
• Les Robertson, Institute of Revenues, Rating and Valuation (IRRV) Representative 

Also in attendance:

• Jonathan Sharma – COSLA
• Ellen Leaver - Scottish Government
• Nuala Gormley - Scottish Government
• David Storrie - Scottish Government    
• James Messis - Scottish Government

Apologies:

• Cllr Katie Hagmann, COSLA Resources Spokesperson 

Items and actions

8th meeting

The Chair, Cllr Shona Morrison, welcomed members to the eighth meeting of the Joint Working Group. It was put to the group that the order of the agenda should switch with item 2 (Deliberative Engagement Paper) and item 3 (Areas of Engagement) – the group agreed to the amended agenda order.

The Chair invited Scottish Government officials to provide an update to the group:

• an update was provided on Council Tax debt and data sharing opportunities through the Digital Economy Act 2017
• Scottish Government officials confirmed that they continued to update the Poverty and Inequality Commission on the work of this group
• an update was provided on identifying a Bill for further changes to Council Tax treatment for second and long-term empty homes

In accordance with the change in the agenda, the Chair invited Convention of Scottish Local Authorities (COSLA) officers to speak to the ‘Areas of Engagement Paper’ from COSLA. The group discussed the first component of the three core positions for areas of engagement contained within the paper – whether engagement should be on property tax options only. The Group agreed that property tax should form the basis of reform. The group briefly discussed land value taxation, with a range of perspectives represented. They agreed that, in time, land value would require consideration alongside non-domestic rates, and establishing the evidence base for that new system would take a long time.

The second aspect of the discussion with respect to the COSLA paper related to a revaluation. Some members of the group set out that they believe that a revaluation is necessary, as a prerequisite for any reform to property taxation, to be included as a subject for engagement. The group agreed that this topic should be included in any deliberative process being progressed in the near term.

The paper also set out clear options of how Council Tax could be reformed. The group discussed those options, and the potential for engagement on additional aspects of reform; this included the Council Tax treatment of second and long-term empty homes, and how ‘ability to pay’ could be included in the process of engagement.

The Chair closed this item and invited Scottish Government officials to introduce the paper on engagement. The group discussed the merits of engaging. 

A wide ranging discussion of the pros and cons of various forms of engagement followed. Some members expressed concern with the feasibility of a full citizens’ assembly for this particular subject at this point. The group agreed that, while deliberative engagement would be an appropriate vehicle to achieve the aims of the group, alternatives to delivering this should be explored more fully.

The group agreed the following:

• to commission Scottish Government officials and COSLA officers to develop a more detailed proposal with the options for a deliberative engagement discussed, they agreed that a range of feasible options should be explored, including for a deliberative Panel/Jury, taking timing and resources into account
• that a work plan would be established based on the agreed options
• options would include costing and resource requirements for each option
• that recommendations arising from the engagement would be delivered to the Working Group by end December 2025
• that proposals should draw on established Principles of deliberative engagement to guide the conduct of the programme, set within clear feasibility parameters for the process
• a proposal would include work strands for:
  • core element of deliberative design with members of the public
  • commissioned expert and independent analysis
  • inclusive engagement for key stakeholder groups

The Chair invited members to raise any other business. No further business was raised, and the meeting was closed.