"We have clarified the intention of the Government's policy on public sector pay, as announced in the Chancellor's budget statement, and its implications for local government, " says the letter from the employers association's chief negotiator, dated 8 July.

BBC: Council workers 'betrayed' by pay freeze

In future, councils may have to work within a fixed budget, set by the Department for Communities and Local Government, for council tax benefit.

BBC: Ministers plan to cap council tax benefit pot

The Scottish government will not know its budget for next year - or how much it may be able to offer local authorities - until the results of the UK government's comprehensive spending review in October.

BBC: Senior SNP councillor backs council tax rise