Cosla president hails new deal for Scottish councils as Yousaf signs Verity House Agreement
Humza Yousaf and council chiefs have agreed a "Bute House-type agreement" between the Scottish Government and local authorities.
The pledge to do so was one of the big promises of Yousaf's SNP leadership bid.
To be known as the Verity House Agreement, the deal includes a commitment to agreeing a new fiscal framework governing the way cash for councils is allocated.
This includes moves on ring-fencing and greater control for local authorities over their own budgets - a key ask by the Council of Scottish Local Authorities (Cosla).
The deal also includes the "expectation" that services will be "delivered at a local level unless agreed otherwise", with regular reviews of councils' powers and funding as well as public service reform.
It further commits the Scottish Government to incorporating the European Charter of Local Self-Government into Scots law.
The Scottish Parliament already passed a bill designed to do this, which was brought by former Green MSP Andy Wightman, but the process stalled after the Supreme Court declared that the legislation was outwith Holyrood's legislative competence.
The block came in 2021 after the UK Government challenged this and the incorporation of the UN Convention on the Rights of the Child into Scots law.
Yousaf said: "The Verity House Agreement is based on the idea that councils know best how to serve the people in their communities. By giving them greater flexibility over how they use their budgets and regularly reviewing their powers and funding, we can empower them to put that knowledge into practice, whether that's to tackle poverty, transform our economy to deliver net zero or to provide the high quality public services on which we all rely."
The signing of the deal follows years of tension between Holyrood and town halls over budgets, ring-fencing and control of services.
Cosla president Shona Morrison called the deal "a clear signal that both parties want to reset the relationship between central and local government".
She went on: "This agreement is about creating a new way of working as a partnership of equals - discussing key issues as early as possible and using our collective expertise to deliver for communities across Scotland.
"Scottish local government is the sphere of government closest to the people of Scotland and delivers a range of essential services that impact on people's everyday lives and livelihoods, from education to improving health; from social care to the fabric of our communities.
"When national and local government work together to tackle shared priorities, the result will be better outcomes for the people of Scotland."