Council budget agreed

The budget, which was considered at today’s full council meeting, has been developed in the context of significant ongoing demand and cost pressures arising from East Lothian’s growing population, alongside wider economic challenges.

The cross-party budget proposals that  members considered are available to read online. They highlight that changing demographics, growing demand for statutory services and increasing national policy expectations mean that the gap between available funding and expenditure requirements continues to grow, set alongside other pressures facing the whole of the public sector. Despite these significant challenges, the agreed budget enables the council to continue investing in significant priority areas such as adult social care, children’s services and education.

Council tax

A 10 per cent council tax increase for 2025/26 was agreed. This follows a freeze in the current financial year. For people living in a Band D property, this represents a £2.76 weekly increase – or an additional £11.96 per month.

Rent

After consultation with council tenants, a 6.5 per cent rent increase was agreed – an average of £5.25 per week. 

Other key points

Councillors also agreed:

• a commitment to invest over £211 million in infrastructure over the next five years including education estate
• an increase of £7.5 million to the Integrated Joint Board (IJB), which is responsible for the planning and delivery of adult health and social care services
• an additional £1 million for council home modernisation
• increase in roads and property renewal budgets of £1m each
• planned savings of £8.9 million over the next five years with a commitment to identify further measures to close the budget gap over the medium term.

The council will also continue investing in local infrastructure and schools through its capital programme, whilst helping to support and protect the local environment.

The uplift of £1 million to the roads budget in 2025-26 brings overall investment in roads over the next five years to £22.7 million.

The capital budget also includes significant investment in the education estate including improvements to security, increasing ASN provision space and the completion of three new primary schools which are due to open in 2025.

Background

East Lothian Council is one of Scotland’s fastest growing council areas in Scotland. However, analysis from the Scottish Parliament Information Centre (SPICe) of the provisional 2025-26 local government finance settlement shows that East Lothian receives the third-lowest funding settlement in Scotland per head of population at 81.4 per cent of the Scottish average. The county’s government funding for 25/26 has risen by around 5 per cent, however, much of this is to meet national policy commitments and will not cover ongoing cost pressures including the rise in employer national contributions which are not fully funded. While the 25/26 proposals will allow the council to meet its obligations to deliver a balanced budget, a five-year funding gap of £79.718 million remains for the authority and IJB to 2029/30.  Taking account of planned savings and council tax increases, this gap reduces to £45.911 million during the same period. The report to today’s meeting highlighted that officers will progress further work to develop a range of options to meet the future funding gap. Work will incorporate effective and meaningful engagement with the public and other key stakeholders.

Sustaining essential services

East Lothian Council Leader Councillor Norman Hampshire said:

“Our financial situation means it has been necessary to set a council tax increase of 10 per cent. East Lothian’s growth continues to put pressure on all parts of the council. It is vital that we can sustain essential services to protect our most vulnerable residents and invest in education to give all children the best start in life. Even in this most difficult of financial circumstances, we have worked hard to deliver a cross-party budget which is what the people of East Lothian would expect of their elected representatives.”

Directing resources where most needed

Leader of the Opposition Councillor Lyn Jardine said:

“With the ongoing financial challenges the council is facing, we must continue to focus on directing our resources where they are most needed. It’s essential we do everything we can to tackle poverty and inequality. Local politicians are at the sharp end of decisions that impact directly and it's extremely difficult to meet increased expectations with reduced resources.  We are therefore committed to working in a collaborative way across parties, with our communities and groups and to have difficult conversations and develop a shared purpose and vision in all that we do.”

The impact of the proposed council tax increase is as follows:

• Band A - £1.84 weekly increase, £7.98 monthly increase
• Band B - £2.15 weekly increase, £9.31 monthly increase
• Band C - £2.45 weekly increase, £10.63 monthly increase
• Band D - £2.76 weekly increase, £11.96 monthly increase
• Band E - £3.63 weekly increase, £15.72 monthly increase
• Band F - £4.49 weekly increase, £19.44 monthly increase
• Band G - £5.41 weekly increase, £23.43 monthly increase
• Band H - £6.76 weekly increase, £29.31 monthly increase

The budget was approved by 17 votes in favour and four against.