Research Shows Block Grant at Lowest Share in a Decade
The SNP has challenged the Labour government to abandon its devastating plans for austerity, reverse the cuts to Scotland’s budget and deliver the major investment boost needed to protect public services and get the economy growing.
It comes ahead of the UK Budget, as new research shows Scotland’s block grant is at its lowest level, as a proportion of UK Government spending, in a decade.
The independent analysis by the House of Commons Library, published today, shows that Scotland’s block grant has fallen as a percentage of UK government spending from 8.2% in 2015/16 to 7.6% this year – meaning Scotland is getting a lower share of the UK spending pie than at any point in the last decade.
The research also shows that, in a like-for-like comparison, the Scottish Government’s block grant has suffered a real-terms cut in every year since 2020, and is now worth £6.4 billion less than it was in 2020/21 – a drop of 12.7%. The like-for-like comparison, before adjustments are made to reflect the recent devolution of tax powers and welfare responsibilities, shows the declining spending power of the Scottish Government over time as a result of Westminster cuts.
Last year, the Scottish Government’s capital block grant was cut by 9.6% – a real-terms cut of around £600 million, and it faces a further 3% cut of around £200 million this year. That means less money available to build affordable homes, hospitals, schools, roads and other projects.
Similarly, the Scottish Government’s resource block grant, which pays for the day-to-day running of the NHS and other frontline public services, has been cut by almost 15% in real-terms since 2020/21, despite the soaring costs of UK inflation, public pay demands, Brexit and COVID backlogs. It means less money available for health, education and policing.
It comes amid a growing Labour Cabinet rebellion over the huge scale of the austerity cuts being planned by Chancellor Rachel Reeves. With cuts and tax rises of around £40 billion being considered, figures including Deputy Prime Minister Angela Rayner are reported to have written to the Prime Minister urging him to overrule the Chancellor and block the cuts.
Scotland’s capital budget has been slashed by £800 million in real terms since 2022.
GRAEME
Labour must reverse the damaging cuts made to Scotland’s budget and provide a fair funding settlement.
The impact of UK austerity, under the Tories for 14 years but now continuing under Labour, cannot be overstated.
It is time for a major boost for investment in Scotland – Labour promised changed and that is what must be delivered.
It’s vital that the Labour government finally listens to voters – and abandons its devastating plan to impose billions of pounds of austerity cuts to public services and Scotland’s budget.
DAVE DOOGAN, ANGUS MP & SNP ECONOMY SPOKESPERSON
The Scottish Government has already had its budget slashed by Westminster. We cannot afford even more cuts from the Labour Party, which would take money away from our NHS, schools, police and vital infrastructure projects like affordable housing, roads and hospitals.
Voters were promised change but instead Labour ministers have been lining their own pockets with thousands of pounds of freebies, while imposing painful austerity cuts on the rest of us.
We were told a Labour government would end the cuts but instead they have increased them – taking the winter fuel payment from around 900,000 Scottish pensioners, pushing thousands of Scottish children into poverty by imposing welfare cuts, and starving Scotland of investment.
Instead of imposing even deeper cuts, the Labour government must abandon its devastating plans for austerity, reverse the cuts to Scotland’s budget and deliver the major investment boost needed to protect public services and get the economy growing.
The Labour Party can’t face both ways on this. If they impose austerity cuts at Westminster, they will hit public services and communities right across Scotland – and they won’t be forgiven.
Background
House of Commons Library research, commissioned by the SNP
House of Commons Library notes on the analysis:
“The resource block grant, and total block grant, are shown in the tables below before adjustments are made to reflect devolution of tax powers and welfare responsibilities. These unadjusted figures are useful for considering the spending power of the Scottish Government over time. The Library briefing The Barnett formula and fiscal devolution has more on how and why the block grant is adjusted as does HM Treasury’s Block Grant Transparency: July 2023 publication.”
Scottish Government block grant as a percentage of UK government spending
Scottish Government block grant
Scottish Government capital block grant
Scottish Government resource block grant
