Scottish Government spent £11bn responding to Covid in first year of pandemic

The Scottish Government spent close to £11bn more in 2020-21 than in the previous financial year as a result of responding to Covid-19.

The government’s consolidated accounts for the year show that total net expenditure was £50.1bn, up £10.7bn on the previous year. A report from Auditor General for Scotland Stephen Boyle found that this “reflect[ed] the significant additional amounts of public spending committed to responding to the Covid-19 pandemic”.

Of the additional spending, £8.6bn came from Barnett consequentials, although Boyle said the government needed to provide more detail of exactly how that money had been spent. He noted that, “while some high-level details of this are available”, in general there was a lack of “comprehensive and detailed information”.

"The Scottish Government had to act quickly and decisively to respond to the huge threats the pandemic posed to lives, public safety, jobs and the economy,” Boyle said.

“As a result, it needed to distribute very large amounts of money quickly, and sometimes had to accept higher risk on this than normal.

"The Scottish Government now needs to be more proactive in showing where and how this money was spent, and show a clearer line from budgets to funding announcements to actual spending. This will support scrutiny and transparency of a matter of such significant public interest and importance."

Yesterday First Minister Nicola Sturgeon wrote to Prime Minister Boris Johnson asking that the Westminster government reinstate the furlough scheme that allowed businesses – particularly in the hospitality industry – to remain viable when forced to close during the first waves of coronavirus.

Sturgeon, who has made it clear that she would like to go further in responding to the Omicron variant than is currently possible, said the scheme is necessary to support businesses that are being impacted by a wave of Covid-related cancellations.

The auditor general’s report showed that in 2020-21 the government spent a total of £1.9bn via two business support schemes – the Business Support Fund and the Strategic Framework Business Fund, both of which were made available to firms operating in the retail and hospitality sectors.

Boyle noted that in making that money available in order to protect jobs and the economy, the government had had to “accept a higher than normal level of risk that money could be lost to fraud and errors”.