MSPs on a key Holyrood committee have said they “remain to be convinced” that the Scottish Government prioritised its core objectives in a “strategic, coherent and co-ordinated way” in its latest Budget.
Members of the Finance Committee said some individual decisions made in the 2024-25 Budget “appear to conflict” with the priorities set by ministers, such as tackling poverty and growing the economy.
The council tax freeze “does not expressly target those in poverty”, MSPs said as they questioned how the policy fits into First Minister Humza Yousaf’s three key “missions”.
The committee also accused ministers of being “focused on plugging short-term funding gaps at the expense of medium and longer-term financial planning”.
Here, its report said “the impression given is that the Scottish Government is procrastinating on important decision-making”.
The committee highlighted Government “delays” in delivering its public sector pay policy for 2024-25 and a financial strategy for public service reform.
NEW REPORT: We've published our report on the Scottish Budget 2024-25.
Read the report and its conclusions👇https://t.co/6No3hLlN4m pic.twitter.com/HTU7cQoFkZ
— Finance and Public Admn Committee (@SP_FinancePAC) January 31, 2024
Reforming Scotland’s public sector is “critical” to the country’s future finances, the committee said, with MSPs making clear just making “efficiency savings across the board will not cut it”.
As a result, they said there needs to be “greater focus from the Scottish Government on developing and delivering this reform programme at a quicker pace in the months and years to come”.
Scotland’s public sector pay policy for next year must be “published as early as possible” after UK Chancellor Jeremy Hunt’s Budget in March, the MSPs added.
They made clear this must “include clarification of the Scottish Government’s plans for reducing the public sector workforce to more sustainable levels”.
Committee convener Kenneth Gibson said: “The Scottish Government’s public service reform programme is critical to the sustainability of the Budget and ensuring effective delivery of public services.
“While the Government has set out principles and objectives for its reform programme, there are few other signs of progress.
“This is disappointing given the urgent need for reform.”
The committee report highlighted the “significant pressures on Scotland’s public finances”, saying these had resulted in ministers making “difficult decisions in relation to taxation and spending”.
While the Government has sought to prioritise spending on its three key missions of “equality, opportunity and community”, the MSPs said: “We remain to be convinced that this prioritisation exercise has been carried out in a strategic, coherent and co-ordinated way.”
The report added that “in fact, some individual decisions appear to conflict with the priorities of tackling poverty, growing the economy and prioritising public services”.
As well as questioning the decision to freeze council tax bills across Scotland, the MSPs said they are “unclear” how spending cuts to further and higher education and to enterprise agencies would help with the aim of having a “fair, green and growing economy”.
The report went on to say “further information” is needed on the impact of a cut in the affordable housing budget on the Government’s commitment to build 110,000 affordable homes by 2032.
Mr Gibson said: “The Scottish Government needs to deliver long-term financial planning.
“At present it gives the impression that it’s procrastinating on important decision-making that would help the sustainability of Scotland’s public finances, albeit in the medium and longer-term.”
Today @SP_FinancePAC has given its verdict on the Scottish Government's Budget, saying it gives the impression it's 'procrastinating on important decision-making'.
It's time to stop pressing snooze on common sense, fair tax reforms. Our full reaction 🔽
https://t.co/FduDNKYAGr pic.twitter.com/QGXFX8zFIy
— Oxfam Scotland (@OxfamScotland) January 31, 2024
He also said the committee was “disappointed at continuing cuts to the capital budget by the UK Government”.
With the Scottish Government’s capital budget set at £6.25 billion for 2024-25, Mr Gibson said this “restricts” its “ability to invest in capital projects, achieving net zero and growing the economy”.
As the report was published, campaigners at Oxfam said the Government can no longer delay “common sense, fair tax reforms”.
Jamie Livingstone, head of Oxfam Scotland, said: “Scotland faces significant social challenges – a stubbornly high poverty rate, yawning inequality, under investment in care, and a string of missed climate targets.
“Tackling these challenges will require substantial investment, both now and in the future.
We simply can’t afford for ministers to continue pressing snooze on the common sense, fair tax reforms we need to see.
“Instead, they must wake up and build cross-party consensus behind the bold changes we need to see in order to build the fairer, greener, more equal Scotland we all want to live in.”
Deputy First Minister and finance secretary Shona Robison said the UK Autumn Statement was a “worst-case scenario” for Scotland, with tax cuts at the “expense of spending on public services”.
She added: “Through this Budget, the Scottish Government is prioritising spending towards its core missions, including committing £6.3 billion in social security benefits and payments to deliver on our national mission to tackle inequality.
“We are also having to make difficult choices to ensure public finances remain on a sustainable trajectory.
“I thank the Finance and Public Administration Committee for its recognition of the challenges the Scottish Government faces and I will respond fully to the report in due course.”