Councils will have to slash millions of pounds from their spending despite a £160m boon for town halls from the SNP’s Budget deal with the Greens.
The SNP struck an agreement with their pro-independence partners in Holyrood on Wednesday, which includes an extra £23m for councils in Tayside and Fife.
Meanwhile, Finance Secretary Derek Mackay turned the screw on higher earners with a new income tax hike in the Budget, which has passed its first hurdle.
Fife Council is to get an extra £11m through the deal, but was already facing £29m of cuts for 2018/19.
A £4m top-up for Dundee will only tackle a quarter of the £16m reduction in spending it requires for the coming year.
David Ross, Labour’s co-leader of Fife Council, said while their grant cut has been eliminated, they still have to find millions of pounds for increased public service demands and public sector pay rises.
“We are pleased to get any additional funding but the deal that has been done is no more than a sticking plaster,” he said.
“It goes nowhere near addressing the real erosion of local services over a period of years.”
The Greens’ support means the passage of the bill through the Scottish Parliament is now safe, with the agreement standing until the final vote at the end of February.
The deal, which was backed by 69 to 56 votes in the parliament, also increases the proportion of public sector workers in line for a 3% pay rise, from half to three-quarters of the workforce.
However, cash for that will have to be found from public bodies’ existing budgets.
Labour said the £160m released by Mr Mackay falls way short of the £545m uplift needed for councils to “stand still”.
The income tax move, which lowers the higher rate threshold to £43,430, will hit 400,000 taxpayers, who will have to cough up an extra £55m between them.
Overall, those earning less than £33,000 will pay less income tax than they do now, with the burden of tax rises falling on those on more than that.
Murdo Fraser, for the Scottish Conservatives, said: “Only a government as arrogant as the SNP would pick peoples’ pockets, and then come back for more.”
Patrick Harvie, co-leader of the Scottish Greens, said: “Last year we stopped the cuts.
“This year we’ve pushed the government even further, and delivered a real-terms increase in funding, including a fair contribution towards the additional pressures councils are facing.”
Mr Mackay said the Budget will “reverse Tory cuts, deliver support for the economy and increase health spending by £400m”.
He added: “The changes I have announced ensure that people in Scotland will benefit from the best deal for taxpayers in the whole of the UK.”
Another element of the deal included a commitment for more funding for transport projects such as rail, rather than new trunk roads.
The Levenmouth Rail project, which campaigns to re-establish a rail link for Leven, welcomed the move saying they “can clearly benefit”.
