Ahead of Parliament’s summer recess, this Insight summarises upcoming fiscal publications, events and parliamentary scrutiny that will take place before the Scottish Budget is published this winter.
So, what’s coming up and how does it all feed into the Scottish Budget?
Income Tax revenues
As we discussed in our Insight earlier this week, on 9 July HMRC will publish data on how much Income Tax was collected in Scotland and other parts of the UK in 2024-25, enabling the calculation of the ‘true’ Income Tax net position for that year. An adjustment (known as a “reconciliation”) needs to be made to next year’s Budget.
When this data is released, we will publish an Insight setting out the adjustment required for 2027-28 spending plans.
Summer publications
Over the summer we will be working on three reports which we will publish on 25 August.
Our Fiscal Update will set out what has changed in the fiscal and economic position since our last set of forecasts in January 2026. Events since then have had major fiscal implications for both the UK and Scottish governments, most importantly the conflict in the Middle East which has led to surges in the cost of oil and gas and stoked uncertainty around inflation and interest rates.
Our Forecast Evaluation Report is our annual publication where we review previous forecasts we have made for the economy, Scottish taxes and social security. It looks at the level of error in our forecasts relative to final data (known as outturn), explains the reasons for the errors, and identifies areas where we may be able to improve the accuracy of future forecasts.
We will also publish a Statement of Data Needs, a document we publish every two years. Its purpose is to identify areas where we believe improvements can be made to the data and information we use for our forecasting and analysis.
New committees, new work plans
Now that the new Scottish Parliamentary committees have been established, they will be developing their pre-Budget scrutiny and wider work plans for the Autumn, while also issuing calls for views.
We stand ready to support new committees in their scrutiny functions. We have a range of online videos setting out our role and how the Scottish Budget is constructed. We will also support the ongoing programme of fiscal literacy for new and existing members as recommended by the previous Parliament’s Finance and Public Administration Committee.
Parliament returns – full fiscal steam ahead
When Parliament returns in September, the newly elected Scottish Government will present its first Programme for Government. This statement by the First Minister is accompanied by a list of proposed legislation for Parliament to consider over the coming year. The Cabinet Secretary for Finance and Local Government has also committed to provide a fiscal Statement to Parliament in September, ‘aligned with the Programme for Government’.
September will also see parliamentary committees commence their pre-Budget scrutiny. A pre-Budget scrutiny period was a recommendation of the Budget Process Review Group which published findings in 2017. This group recommended space in the Parliamentary calendar for committees to consider what areas of their remits’ spending they would like the Scottish Government to prioritise or deprioritise in its Budget. This scrutiny will conclude with the publication of committees’ pre-Budget reports, likely at the end of October. This allows time for the Scottish Government to consider and incorporate recommendations in its 2027-28 Budget.
The first Budget revision for 2026-27 (known as the Autumn Budget Revision) will be published in late September/early October. These revisions set out any in-year changes to the spending plans agreed by Parliament when the 2026-27 Scottish Budget was passed. This allows Parliament to consider any Budget movements and the reasons for them.
UK Budget
The next UK Budget should happen sometime in the Autumn. These are typically October, although last year’s UK Budget wasn’t until late November, pushing the Scottish Budget into the following calendar year.
The UK Budget is extremely important as it sets out UK Government allocations to the Scottish Government (known as the Block Grant). The accompanying Office for Budget Responsibility forecasts underpin the Block Grant Adjustments that are deducted from the Scottish Budget for Scottish taxes and added for social security payments under the control of the Scottish Government.
The Scottish Budget for 2027-28
Attention will then turn to the Scottish Government’s 2027-28 Budget which is normally presented to Parliament in December. It will be accompanied by our forecasts for the economy, Scottish tax revenues and social security spending, as well as funding and spending analysis.
In the Budget the Scottish Government will set out its initial tax and spending plans. As the election resulted in a minority Scottish Government, these plans may well require changes to win the parliamentary support required to pass the Budget.
It promises to be a very interesting and busy second half of the year and we look forward to playing our role in the process.