Council Tax and Spending

The council budget

Every year the council agrees Council Tax charges and allocations of funding to council service areas for the 12 months ahead.

The council is required to set a balanced budget, meaning that our spending plans must be met through our expected revenue. 

The money you pay in Council Tax generates around 25% of our income.

• Council Tax – 25%
• Grants allocated by Scottish Government (including business rates) – 75%

For the coming year, we will receive the third lowest amount of government funding per person when compared against other councils in Scotland.

Setting a balanced budget is increasingly difficult. The cost of providing valued services continues to rise due to factors such as inflation, increasing service demand and population growth – because the council has been playing its part in delivering nationally set housing targets.

While new housing does mean there are more people paying council tax, it also means there is higher demand for our services which isn't fully covered by this income. For example, householders living in a Band D property will pay council tax of £1,697.62. However, on average the council spends £2,347 per household on primary and secondary education. This highlights that the cost of providing services is greater than the income typically received in council tax.

While the amount of national grant funding has risen, around half of it is tied to existing or new policy commitments. It means the council was still left with a budget gap to fill of around £13.3 million, due to the rising cost of services.

Budget headlines

• Council Tax will increase by 7.5% for 2026/27.  This will mean an increase of £2.28 per week for an average property in East Lothian.
• the increase will enable investment in core council services including adult social care, children’s services and education.
• the General Revenue Grant (GRG) received from the Scottish Government will increase by £7.378m, of which £3.668 million is tied to new or existing policy commitments.
• the budget also reflects planned efficiencies of £13.179 million to be delivered over the next 5 years.

(please note that the above information is based on the provisional local government finance settlement information available at the time the budget for 2026/27 onwards was set)

• a £233.504m programme of capital investment in local infrastructure is planned over the next five years, including the education estate.
• new revenue and capital investment to increase capacity for holiday clubs for children with disabilities, youth work and roads winter maintenance.
• there will be a 7% increase in rent levels in 2026/27 for tenants living in council properties.  Rents in East Lothian will remain among the lowest in Scotland and support investment in new build council housing.
• a £215.261m programme of investment is planned in council housing, including significant expenditure on new homes and the modernisation or extension of others is planned over the next five years
• the financial position of the council remains extremely challenging, with rising costs of delivering services not being met through increases in our income.  It has therefore been necessary to draw on £2.1m of reserves to smooth debt charges in 2026/27.
• the council will continue to review how we do things, ensuring we remain as efficient as possible by introducing further innovation, new ways of working and helping to reduce expenditure and/or increase income.  However, the financial challenges which the council is facing over the medium term will mean that some difficult decisions will need to be made around the services which the council is able to sustain in the future.