Edinburgh council tax could go up by 8 per cent, report warns

A report to councillors said the National Insurance hike and a lack of new funding for adult social care left little option but to increase council tax.

The report, which has assumed a council tax rise of 8 per cent in its calculations, said the rise would “strike an appropriate balance” between stabilising short-term council finances and enabling planned capital investments in the near future.

The city’s finance chief, Richard Lloyd-Bithell, told a group of councillors and officers about the proposed increase on Tuesday while speaking about the council’s financial plan for 2025-30.

A hike in employer National Insurance contributions from April 2025 is set to impact council wage bills significantly, and it is as yet unclear if councils will be given support to mitigate this.

Officers had considered a 5 per cent increase in council tax instead, but ruled this out due to uncertainties about expected funding and expenses in the coming year.

It went on to say that the increase would equate to a £43 per year increase for a Band D property over a 5 per cent increase, and that a council tax reduction scheme would be better advertised.

No significant cuts to services are expected amid the budget pressure, but the council will put less money towards a savings fund and some long term programmes.

Several other areas were mentioned in the draft budget.

A review of the Edinburgh Integration Joint Board, the body which coordinates planning for health and social care in the city, is planned over a range of concerns including value for money and governance.

Homelessness services were also mentioned in the report, with an increase in funding proposed to boost the efficiency of the service and procure more temporary housing.

This budget comes from the council’s officers, not from elected officials.

Party groups will now have the opportunity to draft their own budget motions, with a final budget to be decided at a full council meeting on Thursday, February 20.