THE Scottish Government funding deal for local authorities will leave Glasgow facing its greatest ever financial challenge according to council boss Frank McAveety.

But he has "reluctantly" agreed to sign up to the deal to save the city being hit with around £50million of penalties.

Mr McAveety has written Finance Minister John Swinney outlining his concerns at the amount of money the city council will be allowed to spend during the year from April.

He said: "I have signed up to the Swinney Tory budget with great reluctance. This is the most draconian budget ever inflicted on the people of Glasgow by any Government. Worse than that, it comes with ‘pistol to the head’ sanctions.

"Glasgow faces £133m of cuts in the next two years. If we don’t sign up for that, the Scottish Government will hit us with an additional £50m of sanctions. “Don” Swinney is making us an offer we can’t refuse.

"I’ve had legal advice on that. I believe the sanctions proposed by John Swinney could be illegal and if he goes beyond what we recognise to be legal sanctions we will be prepared to take him to court to preserve services for the people of Glasgow.

"My colleagues in Renfrewshire, Aberdeenshire and South Lanarkshire are of a similar view. We are not prepared to put up with bully boy tactics.”

Mr McAveety has told Mr Swinney that as well as continuing the council tax freeze, his budget for 2016/17 will maintain the city's pupil teacher ratio and will support the provision of the Living Wage across all council employees.

Council bosses say their settlement for the year from April includes a cash reduction of £53million, which coupled with budget pressures of £33m means they have a budget shortfall of £86 million.

When added to an estimated shortfall of £47m forecast for 2017/18, the requirement for savings over the next two years is £133m.

The council has identified a series of potential service reforms and efficiencies that could save £77 million over the next two years.

Other savings have been identified for 2016/17 which could, if approved, meet the spending target for the coming financial year but £38million of the savings for 2017/18 have still to be identified.