Scottish budget: Health budget to swells by £1bn due to income tax hike

The Scottish Government’s health and social care budget is set to swell by £1 billion, paid for largely by increasing tax on Scotland’s highest earners.

The budget commits more than £9bn for workforce pay, including the current £515 million pay deal that is being considered by healthcare trade unions.

Several aspects of health spending, such as mental health, early years and the Sportscotland agency, have had their budgets frozen, representing a real-terms cut of around 10 per cent due to inflation.

Announcing the budget to the Scottish Parliament, deputy first minister John Swinney said the 2023/24 health and social care budget would be set at £19.138bn – an increase on the £18.020bn spent on the sector in 2022/23.

Deputy First Minister John Swinney MSP was watched by First Minister Nicola Sturgeon as he delivered his budget to the Scottish Parliament. Picture: Andrew Cowan/Scottish Parliament/PA Wire

“If we want to be able to depend on the NHS, we have to be prepared to pay for it,” he said. “When the UK Government set out its autumn statement, it gave rise to consequential funding for the NHS in Scotland of £291m.

“I intend to pass on that funding consequential, but I do not believe it is nearly enough for the critical task that we ask our staff in the National Health Service to do.

“As a result of the choices I have made on income tax, I am in a position, in one year, to increase the amount we spend on health and social care in Scotland by over £1bn.”

More than £13bn will be invested in NHS health board “to allow them to continue to drive forward the five‑year recovery plan”, while £2bn will be spent “to establish and improve primary health care services in the community”.

Mr Swinney said: “In parallel, we will provide £1.7bn for social care and integration to improve services while paving the way for the introduction of the National Care Service.

“An additional £100m will be made available to support delivery of the £10.90 real living wage for adult social care, building on the increase provided in 2022/23. This is vital work and it is important those on the front line are supported.

“We remain committed to addressing the ongoing public health emergencies and reducing the avoidable harms associated with drugs and alcohol.

“By investing £160m we will ensure this important work continues. This is part of our commitment to provide £250m of additional funding over the life of this Parliament to address the drugs death emergency.”

Scottish Liberal Democrat leader Alex Cole-Hamilton said: “There is a lot of pain in this budget. Pain for mental health services, for a voluntary sector on its knees that will now face another £4m cut and a local government uplift that is barely half what Cosla have asked for in order to keep the lights on.

“I presented the deputy first minister with options for further savings, so I am disappointed that the vast and unnecessary bureaucracy that is the ministerial takeover of social care is still going ahead.

“There is still time to turn this around, if he cancelled those particular plans, that would allow him to offer some hope for the 200,000 sufferers of long Covid on whom this Budget is silent."