IT’S only a matter of time before a Scottish council goes bankrupt, the Local Government Information Unit has said.

The stark warning comes less than a week before the SNP-Green Scottish government takes its draft budget — expected to be the toughest since devolution — to Holyrood. 

The unit — which represents both councillors and officials — made the prediction after a members’ survey found that many councils were worried that they “may be unable to fulfil their statutory duties” and as many as a quarter fearing they would not be able to balance the books in the coming year.

Unit chief executive Jonathon Carr-Watson said the poll showed that “councils in Scotland are raising a red flag that council finances are completely unsustainable,” echoing bankruptcy warnings from the Convention of Scottish Local Authorities (Cosla) last week.

Mr Carr-Watson added: “With nearly a quarter of councils warning they may be unable to fulfil their statutory duties, it is only a matter of time before we see the first council in Scotland declare effective bankruptcy.

“Councils are pulling every lever available to them to balance their books.

“Every respondent said they were cutting spending on services, 97 per cent that they would be increasing fees and charges, and 89 per cent that they would be spending reserves.

“But it is not enough. Councils have little to no confidence in local government finance and the issues behind the crisis are not going away. The Scottish government must work productively with councils to restore trust.”

A Scottish government spokesperson said: “Decisions on local government budget allocations for future years are subject to the outcome of negotiations with Cosla, the results of which will be confirmed in future Scottish budgets.

“Any assumptions relating to possible future budget reductions are entirely speculative at this stage.”