Scotland’s block grant has dropped to its lowest level compared to the rest of the UK in the past ten years, according to a report. The House of Commons Library analysis, requested by the SNP, revealed that the percentage of Westminster spending allocated to Holyrood has decreased from 8.2% in 2015/16 to 7.6% as of July this year.
The SNP highlighted that this decrease meant Scotland’s block grant was reduced by £6.4 billion compared to the previous year, marking a 12.7% drop. These calculations were done before accounting for any adjustments due to the devolution of tax and welfare powers to the Scottish Parliament.
The Scottish Government mentioned that its capital budget has already faced a 9.6% cut, equivalent to around £600 million after adjusting for inflation. Additionally, there is another 3% reduction expected this year. The capital budget is designated for long-term projects like infrastructure and buildings.
Moreover, the SNP emphasized that the resource budget, which covers day-to-day expenses such as healthcare, has seen a nearly 15% decrease in real terms since 2020. The party called on the Chancellor, set to present the first Budget since Labour’s victory in July, to reverse these cuts.
However, amidst discussions of raising funds through tax increases and reductions, the spending plans have already been agreed upon by Prime Minister Sir Keir Starmer and Chancellor Rachel Reeves, who will deliver the Budget on October 30th.
David Doogan MP, the SNP’s economy spokesperson in Westminster, expressed concerns about the potential impact of further austerity cuts on public services and Scotland’s budget. He urged the Labour Government to reconsider its plans and prioritize investments in vital sectors like healthcare, education, and infrastructure projects.
It is crucial for the government to address the financial challenges without compromising essential services. The upcoming Budget is expected to be a significant moment for the UK, with promises of a “reset” by the Chancellor. While tough decisions may lie ahead, it is essential to find a balance that supports economic growth and protects public services.
Mr. Doogan emphasized the importance of avoiding deeper cuts that could harm communities across Scotland. The Labour Party faces a critical decision in determining the Budget’s direction and ensuring that investments are made to stimulate the economy and safeguard essential services.
As discussions continue, it remains to be seen how the Budget will address the current financial landscape and provide the necessary support for Scotland and the UK as a whole. The government’s approach to balancing fiscal challenges with investments in key areas will be closely watched by various stakeholders.