FIFE Council are on the brink of declaring a housing emergency due to a proposed 26 per cent cut in Scottish Government funding for affordable homes.
Labour councillor Judy Hamilton accused SNP ministers of "pulling the rug" out from the local authority, and their partners who are building social housing, and said it would lead to even more people having to move into temporary accommodation.
She said: "Failure to take urgent action will lead to Fife Council having no alternative other than to declare a housing emergency."
The government proposal is included in the draft Scottish budget and would save £190 million but the members of the cabinet committee heard it would make a bad situation - Fife has record numbers of homeless households - even worse.
Cllr Judy Hamilton said the council was facing "extreme housing and homelessness pressures" and tabled a motion asking council leader David Ross to write to the First Minister, Prime Minister and the leaders of all the parties in the Scottish Parliament.
The council's housing spokesperson wants urgent action to try and reverse the proposed cut and find the money to help build their way out of the crisis.
READ MORE: Figures reveal 19 people in Fife died while homeless last year
The committee was told on Thursday that homelessness figures were at an "all time high" with around 1,900 households in Fife that are classed as homeless and waiting for a tenancy.
In 2022-23 there was a seven per cent jump in the number of homelessness applications.
And every night there are 1,000 households, including 380 children, staying in temporary accommodation.
Local authorities in Edinburgh, Glasgow and Argyll & Bute have already declared a housing emergency.
READ MORE: Fife Council fails to meet standards for housing the homeless
Cllr Hamilton said: "To respond to the shortage of housing, since 2012 we've sought to build one of the largest, most sustainable social housing programmes in Scotland, and indeed the UK.
"To respond effectively to homelessness through a transfer-led allocations process is the right thing for the council to do but that's now under threat by the direct cut announced by the Scottish Government to the budget for 2024-25 to the affordable housing programme.
"A reduction of 26 per cent next year and 37 per cent over two years from previous levels of subsidy will have a significant impact on our ability to build new council houses."
She continued: "Incredibly the Scottish Government have, initially, made a choice to reduce new housing to respond to increased homelessness in Scotland and in Fife.
"That action undermines our programme and the opportunity to build our way out of this crisis and condemns more homeless people to live longer in temporary accommodation."
READ MORE: Council under fire over plan to tackle homelessness
Seconding the motion, Lib Dem councillor Jonny Tepp said: "Some of us wanted to call a housing emergency today.
"The situation is terrible but we have been persuaded this is a necessary first step given we haven't seen the final budget and there's still time to influence - we hope."
He said the cut in funding would "hit those struggling the hardest" and that while the move would save £190m, the government had spent £140m to cover the council tax freeze.
Cllr Tepp added: "We know that council tax freezes only benefit those people in higher value properties."
Leader of the opposition, SNP councillor David Alexander, said he would support the motion if it also urged the Prime Minister to increase the funding for Scotland.
He added: "As usual you've totally, absolutely ignored the cut to the Scottish Government from Westminster.
"Let's repeat it again. In revenue terms the budget next year (2023-24) is increasing by 1.4 per cent, inflation is 3.7 per cent.
"This year, 2023-24, the Scottish budget increased by 3 per cent, inflation rose by 7.5 per cent. In 2022-23 the Scottish budget rose by 3 per cent, inflation rose by an average of 9 per cent.
"It's absolutely impossible not to recognise where the blame lies for so many of the financial problems affecting our citizens and services.
"That's why I'm questioning where will this extra money come from, as it doesn't exist in Holyrood.
"All the financial problems we've got come from the south."
Council leader David Ross agreed to include the request for more money for Holyrood in his letter to PM Rishi Sunak.
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