WARNINGS that many of Scotland’s local authorities could increase council tax to balance their books and cut jobs and services unless they receive more funding from the Scottish Government were top of the agenda on yesterday’s Go Radio Business Show with Hunter & Haughey.

Scotland’s councils are facing a £700 million funding gap ahead of setting their budgets for the coming year and some have even hinted that they could introduce or increase charges for some services to help boost funds.

As the government comes under increasing pressure over squeezed local council budgets, Labour peer Lord Willie Haughey said: “I don’t mind paying my taxes and local council tax and I don’t mind if they go up – but the service I am getting isn’t good. If you were buying a service from anyone else and it wasn’t good, you wouldn’t want there to be an increase for that service and you would be asking, ‘why am I paying for what I’m paying’.

“The things that we pay for that we take for granted – our roads, our policing, our bins … nothing is good. For me, raising taxes at this time is totally unacceptable.”

Entrepreneur Sir Tom Hunter added: “Everybody is saying there is no money but I think it is an allocation problem, not a budget problem.”

Sir Tom pointed to a recent project at his Hunter Foundation which involved asking a company what services provided by its local authority it used. “They were only interested in about 40 per cent [of those services] therefore 60% was being wasted,” he said. “If that business was your customer, you would change your offering.”

Calling on the government to “take the handcuffs off and let local authorities be more entrepreneurial”, Lord Haughey pointed to Manchester as a great example of a city that hasn’t been prepared to rest on its laurels. “Look at what Manchester has done over the last 10 to 15 years,” he said. “Look at how it generates revenues – you go ‘wow, what a job they have done’.

Sir Tom was blunt: “If you were devising a system to run a country’s finances you wouldn’t have the one Scotland’s got.”

Lord Haughey, alluding to Scottish Government’s record £2 billion underspend in the last financial year and reported by The Herald in December, said: “This is what makes people angry. Everyone has to be accountable.”

From a budget of £51.2bn, ministers spent £49.2bn, according to consolidated accounts with Auditor General Stephen Boyle stating: “The Scottish Government has strengthened its focus on longer-term financial planning, but there is still more it can do to ensure there is much greater transparency around its spending.”

On more positive note, Sir Tom applauded the Scottish Government for its support of his Scottish EDGE funding competition and advised that applications for the current round close on February 14. “Up to £100,000 is available and if you are a social enterprise up to £70,000 is available,” he said. “For Young EDGE businesses, you can get between £10,000 and £15,000. Scottish EDGE is one of the best things we do in Scotland.

“The whole reason that The Hunter Foundation, NatWest and the Scottish Government put Scottish EDGE together was because early-stage financing is the most difficult – it is the most risky.”

Lord Haughey, a long-time supporter of the Scottish EDGE programme, alluded to recent reports that suggested early investment funding in Scotland was not fit for purpose, adding: “Scottish EDGE is perfect for that niche in the market where we need people who just beginning to scale up their business.”