Greens propose new deal on tax and capital for Councils

For immediate release 6 February 2010

The Scottish Green MSPs today set out an alternative model for the Scottish Government to work with Scotland's 32 local authorities and support prudent capital investment. Under existing "prudential borrowing" rules, local councils could invest to support community energy generation, protect public services and create jobs, while Scottish Ministers are not currently empowered to borrow even to invest.

Under the Green proposals, Ministers would assess whether local authorities' borrowing plans would bring in future revenue and support a low-carbon economy. The cost of servicing loans on projects that meet these criteria, including public transport or community-owned heat and renewables, would then be met by Scottish Ministers. This model could also be used to fund capital projects which would otherwise have been paid out of limited national capital budgets. In 2008-9, the most recent year for which figures are available, local authorities drew on a total of just over