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by Louise Wilson
29 January 2025
MSPs call for more fiscal clarity from Scottish Government

The finance committee has reported in the Scottish budget | Alamy

MSPs call for more fiscal clarity from Scottish Government

MSPs on Holyrood’s finance committee have called for more fiscal and economic clarity from the Scottish Government in its report on the 2025-26 budget.

The budget is set to pass next month after both the Greens and Liberal Democrats confirmed yesterday they would support the SNP minority administration.

But the Finance and Public Administration Committee has criticised the government for delays and unanswered concerns.

Committee convener Kenneth Gibson said: “Regarding delays in publishing key strategic financial documents, the committee repeatedly expressed concerns. This is indicative of a wider problem where vital medium and longer-term financial planning within the Scottish Government is lacking.”

The committee report, published ahead of its debate on Thursday and the stage one debate next week, calls for more detail on behavioural responses to the government’s tax policy, rising social security spend, and the impact of the UK Government’s increase to National Insurance contributions.

Gibson said more information was needed on how the government would respond to the “expected shortfall” in funding from the UK Government to cover the direct NI rise costs to the public sector.

On social security, the committee highlights that no funding has been assigned to the government’s plan to lift the two-child cap from next year and seeks further information on the funding of the policy if it can be introduced early.

Finance secretary Shona Robison said the government hopes to begin mitigating the cap in 2026 but a precise timeline was dependent on receiving the necessary information from the Department for Work and Pensions.

Ministers have indicated they would provide payments to families earlier if possible.

The Scottish Fiscal Commission has estimated the cost of mitigating the cap in 2026-27 would be £155m, rising to almost £200m by the end of the decade.

The finance committee also urged the Scottish Government to restart paused capital projects, given the increase in capital spending coming from the UK Government, and prioritise capital commitments to ensure it can “hit the ground running” at the start of the financial year.

More widely on the economy, it called for more information on how the government will ensure further and higher education responds to the skills needs of businesses, and maximise opportunities for Scotland’s universities to be globally competitive.

The Scottish Government’s deal with the two smaller opposition parties will see more cash for drug and alcohol services, expanding free school meals, hospices, nature restoration and colleges.

The Greens also secured a commitment to a year-long regional trial to cap bus fares, beginning next year. Details on the trial have not yet been confirmed, though Robison said it will be an area that covers both rural and urban parts.

The finance committee will lead a debate on Thursday, in which the majority of committee conveners will speak, before the first debate on the budget bill on Tuesday.

Amendments will be made to the bill reflecting the SNP/Green/Lib Dem deal before the final debate at the end of the month.

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