Glasgow facing £80m financial black hole even with 10% council tax rise

Glasgow City Council is facing a significant £110m budget gap by 2028.

Even if the local authority increases council tax by 5% for the next two years, it would still face an £80m black hole.

More than £65m of the shortfall is from pressure associated with homelessness, the council’s latest financial outlook report said.

It comes amid weak economic growth and a downturn in business across the UK and “significant challenges” in public funding for the Scottish Government.

Glasgow’s finance director, Robert Emmott, said housing and homelessness remains one of the council’s biggest expenses.

It was previously reported that Glasgow houses around 4,000 asylum seekers, which the council warned in April is putting too much pressure on the city’s services.

It was also reported that a decision by the previous UK Government to speed up the processing of asylum claims had led to more people presenting as homeless in Glasgow.

Nevertheless, councillors agreed in March to cover the cost of a UK Government decision to speed up the processing of asylum claims for another year.

Unless policy changes, the costs of that decision will rise to £43m in 2025/26 and £66m in 2026/27.

Mr Emmott’s latest report said a “pause” in both asylum dispersal to Glasgow and the requirement to house asylum applicants from outwith Scotland would reduce estimated costs to £36m in 2025/26 and then to £13m in 2026/27, if implemented from October 2025.

Glasgow’s city administration committee report will recommend seeking more money and further help from the UK and Scottish Government’s on the impact of homelessness within the city.

Glasgow City Council has been asked for comment.