Inverclyde Council could be forced to make additional savings of around £2m next year

Officials were looking at a funding gap of around £3m but that is now likely to be over £5m after Scottish Government finance secretary Derek Mackay unveiled his spending plans for 2019/20 on Wednesday.

The government says councils will receive a total of £11.1 billion during that period, including an additional £198m in the revenue grant, which pays for day-to-day costs, and an extra £207m for one-off capital projects.

But Scottish local authority umbrella group Cosla argues that because vast sums of money are already designated for certain things - such as the increase in nursery hours provision - town hall chiefs cannot access the money to spend as they see fit.

They say the settlement actually equates to cuts across the board of £175m to the revenue grant and £17m less in capital funding.

Council officials are still waiting to find out exactly how much money they will receive and what it means for services but local authority leader, Stephen McCabe says they have been given a raw deal.

Councillor McCabe said: "It's a very poor settlement for local government. "While there is extra money for a range of new responsibilities, the funding for existing services has been cut by £237m. "We have yet to receive the detailed figures for Inverclyde but it is likely that we will be facing significantly greater cuts than we had anticipated. "We will obviously continue to lobby the Scottish Government for a much improved settlement when the final budget is set in February."

Mr Mackay also announced that local authorities are free to raise council tax again without penalty but only by a maximum of three per cent.

In Inverclyde, the levy went up for the first time in a decade last year following the end of the Scottish Government freeze, which was introduced in 2007.

Council tax went up by three per cent raising an additional £860,000.

Mr Mackay's draft budget will be voted on at Holyrood in February.