The Scottish Fiscal Commission has today published an update to its economic and fiscal forecasts alongside the Scottish Government’s Medium-Term Financial Strategy. It reflects changes since the Commission published its forecasts on 29 May including the UK Government’s Spending Review and new Scottish Government tax and social security policies.
Total funding in 2026-27 will be £61.3 billion rising to £66.5 billion by 2029-30. The funding available for day-to-day spending next year is £54.0 billion, or £46.3 billion after social security spending is deducted. In 2029-30, £59.1 billion is expected to be available for day-to-day spending and £50.1 billion after social security spending.
The Scottish Government now has the information it needs to complete its spending review, which it intends to publish later in the year alongside the 2026-27 Scottish Budget. With the Government also now estimating that day-to-day spending will be likely to exceed the funding available by up to £2.6 billion in 2029-30 it has set out broad plans to control spending, including through reductions in public sector employment.
The Commission’s Chair, Professor Graeme Roy, said
“Now that we have the detail on funding following the UK Spending Review earlier this month, the Scottish Government has the information it needs to complete its own spending review.”
“With the Scottish Government’s Medium-Term Financial Strategy highlighting a ‘fiscal gap’ between spending and funding, it is vital that this review carefully assesses the priorities across all areas of their spending.”
“The Government have today set out their broad intention on how they intend to manage some of these fiscal pressures. But with growing commitments on public sector pay and social security, alongside longer term pressures from an ageing population and climate change, it is important that these ambitions are turned into concrete action.”