North-east residents were today facing a 3% rise in their council tax bills as it emerged cuts could be made to frontline services.

Fears of an increase came after it was revealed Finance Secretary Derek Mackay’s funding settlement to councils factored in the local authorities approving the rise.

Leaders of Aberdeen and Aberdeenshire councils said it was likely council tax bills would increase.

And Aberdeen City Council’s co-leaders hit out at the Scottish Government for cutting the authority’s general revenue grant by almost £60 million in three years.

Jenny Laing, Aberdeen City Council co-leader, said the budget settlement is “disastrous” for the city, adding the local authority would have to look at cuts to “frontline services”.

She added: “We will have to look at everything because local government have been saying for some time that the chronic under-funding year-on-year will inevitably impact on the services people really need day in and day out.

“I think we have been very innovative over the last few years and financially prudent which has meant we have managed to lessen the impact, but we have come to the end of the road and it’s quite clear we will have to look at cutting frontline services.

“I think the tough times the city went through eight or nine years ago have meant that the low hanging fruit is long gone in this city and we’re down to the bone.”

Douglas Lumsden, fellow co-leader of the council, said “tough decisions” will have to be made over the next few months before the council sets its own budget in March.

He said: “There is no fat left in the budget so we’ve got to look at all services we’re providing and see if we should still be providing those services.

“We’ll have to look at waste services, all the park services we provide and the events we do. Everything will have to be looked at over the next few months.

“This is going to have serious implications for everyone in the city.”

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And council leaders issued a call for politicians, business leaders and trade unions to come together in condemning Mr Mackay for the way he is treating the city.

Mr Lumsden added: “The public of Aberdeen, business leaders, trade unions, CoSLA, and third sector leaders must all unite in condemning Derek Mackay MSP for the way in which he is treating Aberdeen City. It is a fact that for the budget in 2016-17 Aberdeen City Council received by way of general revenue grant £117.541m for 2019-20, the general revenue grant has fallen to £57.038m – a cut in the grant of over £59.503m.”

“This financial settlement puts Aberdeen City Council’s residents at real risk of seeing cuts to services.

“Derek Mackay has acted in the most callous of manner preferring to divert Aberdeen’s residents hard-earned money to local authorities in the Central Belt rather than help Aberdeen through its economic difficulties.”

Mr Lumsden added: “We have little choice but to put council tax up.”

Councillor Laing added: “It is clear from the financial settlement that Derek Mackay MSP and the SNP do not care about protecting public services in Aberdeen, otherwise our general revenue grant would not be reduced by over 50% in the last three years.

“Derek Mackay is certainly acting like Ebenezer Scrooge as he is a miser when it comes to providing Aberdeen City Council with a fair settlement.”

Mrs Laing added: “It is incumbent on all politicians who represent citizens of Aberdeen to come together to force Derek Mackay to think again on this miserly settlement and I call on Councillor Flynn and Councillor Yuill to put party politics to one side and get behind the administration in seeking a better and fairer settlement for our citizens.”

Aberdeenshire Council leader Jim Gifford said the settlement would put frontline services at risk as he bemoaned years of insufficient funding. He said: “We will do what we can to preserve frontline services that people rely on day in and day out, but years of budget cuts mean that pressure on them is increasing.”

According to Mr Mackay’s figures, raising council tax by 3% would generate almost £80m across Scotland.

To meet the finance secretary’s £11.2 billion forecast, total council tax gathered in Aberdeen would increase by £3.669m in the coming year, giving a total of more than £376m.

Aberdeenshire would experience an increase of £4.197m.

Mr Mackay added: “The Scottish Government has continued to ensure that our partners in local government receive a fair funding settlement despite further cuts to the Scottish Budget from the UK Government.

“If local authorities choose to use their powers to increase council tax by up to 3% they can generate up to an additional £80m to support the delivery of essential local services.”