MSPs ‘in the dark’ over Scottish Government fiscal plans, committee claims

Holyrood’s finance committee is “in the dark” over the Scottish Government’s long-term fiscal plans, it is claimed.

The Scottish Budget has been pushed back to January to allow for the later publication of the UK Budget, which is scheduled for the end of November.

The Scottish Spending Review is also expected in January and MSPs on the Finance and Public Administration Committee want ministers to use that to “bring clarity” on financial priorities.

They say long-term fiscal planning must begin now to address looming financial challenges and complain of being “in the dark” on the SNP administration’s thinking.

The Scottish Government has said it has set out a “credible plan” on the direction of travel through its Medium-Term Financial Strategy, published earlier this year.

But committee convener Kenneth Gibson has said the cross-party panel does “not share” that view and it has not seen convincing evidence to support the government’s argument that the future social security budget is sustainable.

Gibson said: “We agree with the Scottish Fiscal Commission (SFC) that the spending review provides an opportunity for the Scottish Government to set out how it will address Scotland’s long-term fiscal sustainability challenges.

“We seek further details of how the government is directing spending toward its priorities and what areas are being deprioritised. 

“We’d also like to know how ministers plan to meet their ambitions for public sector workforce reductions and efficiencies worth £1bn over the next five years. Evidence and trends suggest these targets will be incredibly challenging to meet.”

Gibson said the committee asked for a government response to an SFC report on demographics more than two years ago, and is “still waiting” for the answer.

He stated: “Ministers must put greater emphasis on longer-term financial planning now, in order to mitigate the potentially significant impact of future trends within Scotland’s economy and population.”

The comments come as the committee publishes a report today which calls for answers on supporting businesses for economic growth and to change attitudes to risk. It also questions scale-up measures for fintech and other sections, as well as moves to increase labour market participation amongst people with disabilities.

Gibson said: “Our committee is not convinced that the Scottish Government has set out sufficient evidence to support its argument that the future social security budget is sustainable.

“We are disappointed the government’s Medium-Term Financial Strategy did not include the information we requested on the fiscal sustainability of social security spending.

“Nor did the government say how it is assessing the effectiveness of, and outcomes from, its approach to benefits delivery in Scotland, or how this impacts upon other parts of the Budget.

“We’ve therefore asked the government again to carry out this work and report back without further delay.”

Responding, finance secretary Shona Robison said: “The Scottish Government notes the committee’s views and we will respond alongside the budget as is standard procedure.

“This government has delivered a balanced budget every year. However, we have been candid about the challenging financial environment we face, caused in large part by persistent high inflation and the decisions of the UK Government.

“We are calling on the UK Government’s Autumn Budget to deliver more funding for public services, infrastructure, and cost-of-living support – including by abolishing the two-child limit in universal credit.

“The financial strategy and delivery plan I published earlier this year means funding in the forthcoming 2026-27 Scottish Budget can be targeted at frontline services such as the NHS, action to eradicate child poverty and other priorities whilst ensuring the continued stability of our finances.

“We are also taking forward a Public Service Reform strategy to deliver services that are preventative, better joined up and more efficient. I will set out our multi-year Spending Review in January, alongside the Budget.”