Scottish government to make £500 million in cuts as ministers warn of 'unsustainable' spending
3 September 2024, 16:14
The Scottish government is set to make £500 million of cuts, as the finance minister warned that current spending plans were "not sustainable".
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The SNP's Shona Robison said the cuts would affect a range of government areas, including capital investment on building schemes, plans to boost sustainable and active travel, and some spending on recruitment, overtime, travel and marketing.
Up to £460 million of the money raised by the Scotwind scheme to lease out the Scottish seabed, which had previously been earmarked for investment in environmental schemes, will also be used elsewhere.
Ms Robison said: "Prolonged Westminster austerity, the economic damage of Brexit, a global pandemic, the war in Ukraine, and the cost of living crisis have all placed enormous and growing pressure on the public finances."
She said that Scotland "cannot ignore the severe financial challenges we face", adding that "we will continue to be a fiscally responsible government and balance the budget each year.
She told MSPs: "But this will mean we must unfortunately take difficult decisions along the way. I believe we can all agree on the importance of putting the public first in all that we do.
"I am calling on members across the Chamber to work together to navigate the challenges ahead, in the best interests of all the people that we have the privilege to serve."
Ms Robison said the cuts she set out were necessary, telling MSPs: "If the Scottish Government does not act, spending will continue to outstrip available funding.
"This is not sustainable and tough decisions will be required. Annual savings alone will not address this. All members of parliament must face up to this challenge in the demands they make during the budget process."
And the Finance Secretary warned of further difficult decisions ahead, saying: "As we look ahead, it is clear that further significant action will be needed to reset the public finances onto a sustainable path.
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"The Chancellor has made clear that UK Government funding will continue to be tightly constrained. The Prime Minister has also made clear the difficult decisions to come."
Ms Robison said that the government would prioritise spending on the NHS.
She told MSPs: "We will take the twin approach of investment and reform in our health services - an approach which rightly tackles the population health challenges we face.
"Where necessary that must mean realigning spend to ensure it reaches those that most need it."
She hinted that hinted that the Scottish Government would not boost income tax even further at the next Scottish budget, which is set to take place on December 4.
Ms Robison said: "On the application of taxation we can only go so far, given the scope of our devolved tax powers.
"Raising significant further revenue would require substantial reform to the tax system or further devolution of powers.
"These will take time and rely on the UK Government. It is therefore essential that we aim to grow the economy and the tax base to support a sustained flow of revenues over time."
Outlining where the cuts would be implemented, Ms Robison said £188 million will be found across Government, including by cutting active travel funding, £65 million by re-purposing cash from other projects and around £60 million through already announced spending controls.
Up to £460 million from the ScotWind leasing round will also be used, Ms Robison said, in the hopes it won't all required to be spent.
But the Finance Secretary warned of further tough decisions, saying: "As we look ahead, it is clear that further significant action will be needed to reset the public finances onto a sustainable path.
"The Chancellor has made clear that UK Government funding will continue to be tightly constrained. The Prime Minister has also made clear the difficult decisions to come."
The SNP's political opponents and trade union chiefs said Scotland's governing party should take responsibility for the economic situation.
Labour's Michael Marra said Ms Robison's remarks were a "threadbare attempt to pass the buck".
Scottish Conservative MSP Liz Smith said it was "abundantly clear" that the situation was because of the government's own decisions.
Hitting out at the decision not to use Scotwind funds on green projects, the Scottish Greens called Ms Robison's statement "a disaster for our climate."
She added: "The SNP have chosen to slash spending on climate action and increase costs for commuters.“With global temperatures rising, Scotland must be a climate leader but the SNP is taking us backwards."
Roz Foyer, the secretary general of the Scottish Trades Union Congress, said "workers and communities across Scotland will be scarred for generations to come" by the cuts and called for higher taxes on the rich instead.
She added: "The people of Scotland do not want a Scottish government that administers cuts while annunciating the droopy mantra of ‘it wisnae me’.
"They want politicians that choose to govern – and that means taxing the rich to invest in the services that we all rely on.”
