A look ahead to the Scottish Budget

We take stock one month before the Scottish budget...

Thursday 15th November 2018

Cabinet Secretary for Finance, Economy & Work,Derek MacKay will stand before the Scottish Parliament some six weeks after Chancellor of the Exchequer, Phillip Hammond, stood in the House of Commons delivering a UK Budget that was to mark the beginning of the end of austerity. Unsurprisingly, the Scottish Government lambasted Hammonds offering declaring it abjectly failed to deliver an end to austerity and would leave Scotland with 2bn less than what was received in 2010-11. The SNPs health spokesperson in Westminster, Dr Philippa Whitford MP, called on the UK Government to pay up the 54.5m Scotlands NHS had been short-changed by the Budget, suggesting Scotland could lose out on over 270m over the next five years. The Liberal Democrats concurred to some extent, stating an opportunity had been missed to give public services and businesses a confident future, while the Scottish Conservatives stated Scotlands block grant was to rise both in cash and real terms despite the claims of the SNP.

There have already been significant announcements on health funding in recent weeks, alongside heavy and at times fairly critical commentary on the management of health services. In the Scottish Parliament, the Health & Sport Committee published its own thoughts on related matters through its report, Looking ahead to the Scottish government - health budget 2019-20 Is the budget delivering the desired outcomes for health and social care in Scotland? The Committee called for greater transparency in spending from Integrated Joint Boards (IJBs) and suggested integration of health and social care was being held back by IJBs not spending their significant budgets effectively.

During a recent bout of FMQs, the Scottish Conservatives interim leader, Jackson Carlaw (again) attacked Nicola Sturgeon for under-funding and mismanaging the health service. Her rebuttal cited a recent report from the Fraser of Allander Institute which she said demonstrated spending on health was increasing in Scotland over a period of ten years where funding from the UK had decreased in real terms by 2bn.

The report from Audit Scotland, The NHS in Scotland 2018, published on Thursday 25th October, stated urgent action was needed to move the NHS away from short-term firefighting and to bring about essential long-term and fundamental change. This was preceded earlier in the month by another Audit Scotland report which warned of the significant financial challenges faced by NHS Ayrshire & Arran and NHS Highland, which were likely to continue in the years ahead.

The Scottish Government has done its best to suggest all is in hand though, citing the publication of the Medium Term Health and Social Care Financial Framework at the beginning of October. The Framework set out the Governments understanding of the current and predicted financial requirements of the health service. This included an expectation of 3.3bn more in Barnett Consequentials to be delivered to Scotland for health spending as a result of a promise from the UK Government to increase spending in NHS England, as well as an announcement that NHS territorial boards which had overspent their budgets over the past five years and accepted brokerage funding from the Government would no longer be required to repay such debts.

However, given the Scottish Governments plans depended on the UK Government delivering a net-benefit in Barnett Consequentials, without reducing funding in other areas, the platform of Derek MacKays announcements in December will likely consist of acting to counteract what his administration characterises as continued austerity inflicted by the Theresa Mays Government.

All this, of course, comes with a caveat of Brexit The Scottish Governments consistent narrative has been the UK Government either does not understand or does not care about the risks of Brexit to the NHS workforce and other related areas such as international research collaboratives. The Scottish Government and the UK Government have both already issued warnings that any financial plans will be subject to change depending on the circumstances under which the UK is to leave the EU. If the chaos unleashed after the publication of a draft withdrawal agreement by Theresa May this week is anything to go by, we can only advise that you watch this space.