Scottish Government to receive ‘very generous’ additional £1.5bn – UK minister

The autumn statement will deliver a “very generous” additional £1.5 billion for the Scottish Government, a UK Government minister has said.

John Glen, Chief Secretary to the Treasury, said Chancellor Jeremy Hunt’s decisions around health and education spending south of the border will deliver the sum to Scotland over two financial years.

Mr Glen also said he “very much” regrets decisions taken in the mini-budget in September by Liz Truss’s government.

Asked if there will be a real-terms cut in the Scottish Government’s budget, he said it partly depends on how inflationary pressures are measured.

Autumn statement 2022
Chancellor Jeremy Hunt delivered his autumn statement to MPs (House of Commons)

Speaking to reporters on Thursday afternoon, Mr Glen said: “DA (devolved administration) funding has grown at around 7% in real terms this year.”

Mr Glen said he did not have specific figures on how the Scottish Government’s budget would be affected in real terms in future years.

The minister said he did not recognise claims that £1.7 billion had been wiped off the Scottish Government’s budget due to the mini-budget.

He said: “The £1.7 billion figure that is cited is, I think, the in-year inflationary pressures for this year, which is very different to what we see in the GDP deflator that we use.

“What I see is a very generous settlement of £1.5 billion which will amplify by a significant margin – probably well over 20% more than we see in England.

“How the Scottish Government distribute that and what they choose to do with welfare versus the NHS will be decisions that they can make.”

Mr Glen was asked if the UK Government should apologise for the economic turmoil caused by the mini-budget.

He said current Prime Minister Rishi Sunak has been very clear that mistakes had been made by the previous administration.

Pressed on whether he would apologise, he added: “I regret very much what was done.

“I’ve used the language I want to use and that’s that.

“I’m determined to do everything I can to put things in the best possible place.”

He said the autumn statement will deliver stability and growth while protecting public services.

Deputy First Minister John Swinney later responded to the autumn statement on behalf of the Scottish Government.

He said: “Today’s statement shows that households across Scotland are paying a steep price for the economic mismanagement of the UK Government, with average household disposable incomes forecast to fall by 7% in real terms according to the Office for Budget Responsibility.

“This would erode just under 10 years of growth in living standards, taking them back to levels not seen since 2013-14, meaning they would not recover to pre-pandemic levels until after 2027-28 – a devastating indictment of the UK Government’s management of the economy.

UK tax burden (as % of GDP)
(PA Graphics)

“Inflation is eating away at the Scottish budget, and due to the lack of additional funding in 2022-23 and the financial restrictions of devolution, we have had no choice but to make savings of more than £1 billion.”

He said he welcomed the Chancellor’s decision to increase benefits in line with inflation and maintain the pensions triple lock.

Mr Swinney said he would take time to consider the implications of the autumn statement, adding: “This leaves me with the difficult task of setting Scotland’s Budget for 2023-24 with no hope of financial flexibility to make a real difference in the lives of those who need it most.”