CLACKS Council could face some of the toughest challenges in Scotland to balance the books, a watchdog has warned a day before councillors are due to hear a budget update.

An Accounts Commission report on the budgets set by councils showed that as a percentage of the revenue budget – the council's day-to-day expenditure – Clackmannanshire had the third highest budget gap in Scotland in 2024-25.

And looking ahead to 2026-27, the cumulative gap as a proportion of the budget is projected to be 12 per cent, second highest in Scotland behind the Shetland Islands at 22 per cent.

The report on 2024-25 council budgets explained that a near six per cent increase in Scottish Government revenue funding to local authorities – totalling £13.25 billion – masks significant underlying financial challenges and strain.

Almost all the increases in funding have been ring-fenced for policies and to cover the costs of pay increases in 2023-24.

As reported by the Advertiser, Clacks councillors will on Thursday, May 16, hear an update on the local authority’s budget strategy going ahead with work already to begin on the next budget amid a “challenging and highly uncertain” financial and economic context.

The Accounts Commission, which holds councils and other local government bodies in Scotland to account while helping them to improve, said that there will be increasingly difficult decisions to be made to deliver savings and address budget gaps.

In Clacks, a spending restraint will remain in place until at least June this year while it will be “extremely important” to prioritise the delivery of savings agreed.

The indicative funding gap, the amount of money needed to continue ongoing operations, is just over £13m for 2025-26 and the council has already approved savings of £65.7m since 2010.

Derek Yule, member of the Accounts Commission, said: “It's getting harder for councils to do more with less.

“They have to find and then deliver significant levels of savings to address budget gaps.

“Fully engaging with local people and being clear about the different and difficult budget choices is vital, whilst understanding the impacts on the most vulnerable.”

The small size of the Wee County undoubtedly presents challenges.

A report to be tabled at Kilncraigs said: “In recent council briefings and council meetings, the council leader and chief executive have briefed councillors on political and managerial engagement to promote understanding, awareness and potential action with regards Clackmannanshire Council’s systemic and contextual challenges and how this relates the funding and distribution mechanism.

“This work continues with both COSLA and Scottish Government, following recent visits by the COSLA presidential team and the permanent secretary and Scottish Government directors to Clackmannanshire.”