Measures announced today will provide further help to those most impacted by the cost of living crisis while tackling budget pressures caused by rising inflation and economic uncertainty.
The Emergency Budget Review (EBR) for 2022-23 identifies funding of around £35 million for a range of initiatives to support people with the increased cost of living, including doubling the Fuel Insecurity Fund, doubling the Scottish Child Bridging Payment to £260 and a new £1.4 million Island Cost Crisis Emergency Fund to help island households manage higher energy costs.
Significant investment in public sector pay deals – delivering higher increases in pay for low earners – is also designed to help families and individuals deal with the cost of living crisis.
Other measures include:
- confirming funds to local authorities to support Discretionary Housing Payments
- establishing a Joint Taskforce with business, COSLA, local authorities and agencies to consider the differing impacts of regulation on business
- extending energy advice to businesses by investing £300,000 to expand the services of Business Energy Scotland, while doubling the value of the SME energy efficiency Loan and Cash Back Scheme for energy efficiency to £20,000
- new payment break options to help protect those who have agreed to repay debt through the Debt Arrangement Scheme but face unexpected increases in the cost of living
Additional savings of £615 million have been identified to enable enhanced public sector pay offers to be made while maintaining a route to complying with Ministers’ responsibility to balance the budget. They follow savings of £560 million announced on 7 September.
Deputy First Minister John Swinney said:
“There has never been a time of greater pressure on the public finances.
“The Scottish Government’s budget today is worth £1.7 billion less than when it was published last December. At the same time, demand for government support and intervention is understandably increasing while we continue to try to fund increased public sector pay claims, particularly for those on lowest incomes.
“These savings are not ones we would wish to make, but in the absence of additional funding from the UK Government, we are left with no alternative.
“We must balance the books while prioritising funding to help families, back business, provide fair pay awards and to protect the delivery of public services. This Emergency Budget Review delivers on these objectives.”
Background
The Deputy First Minister’s Emergency Budget Review statement
Equality and Fairer Scotland Assessment of the Emergency Budget Review
Cost of living analytical report
Expert Economist Panel commentary
The EBR will see £400 million spending reprioritised within Health and Social Care to support a fair pay offer to NHS staff. The overall health budget remains unchanged. Further savings of £33 million have been found across the Scottish Government and £180 million of capital spending reductions identified.
The EBR consisted of a thorough review of all devolved spend planned for 2022-23, across all portfolios, to support a path to balance the budget in light of significant pressure (e.g. inflation, pay deals, increased demand), and to identify opportunities for savings to support measures to help with the cost of living crisis. The process was informed by a panel of leading economists.
