Budget 2017: Chancellor pledges £350m to Holyrood

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Scotland will receive a £350 million funding boost as a result of Budget announcements, the Chancellor has said.

The money comes through the Barnett formula due to increased UK Government spending in social care, health and education.

Chancellor Philip Hammond . Picture: PA

Chancellor Philip Hammond . Picture: PA

Philip Hammond said the funding package was ‘’demonstrating once again that we are stronger together in this great United Kingdom’’.

He also announced measures to support the oil and gas industry, including an expert panel to look at how taxation can be used to help the sector.

Under the Barnett formula - used to calculate public expenditure allocated to the devolved nations - the Scottish Government’s resource budget will be boosted by £260 million in the period to 2020 while the capital budget will increase by £90 million to 2021.

READ MORE: Budget 2017: What do the plans mean for Scotland?

Mr Hammond said: “Today’s Budget equips our economy and our people for the future - while dealing with the challenges we face as one nation.

“Benefiting from £350 million of extra investment, the Scottish Government can take further steps to strengthen Scotland’s economy and make sure that Scottish people, of all background and no matter where they live, feel the benefits of economic growth.”

The Treasury also confirmed “good progress” is being made towards a City Deal with Edinburgh, which would provide a package of decision-making and funding powers, while negotiations on a City Deal for Stirling have been opened.

It said the UK Government also looks forward to considering proposals for a Tay Cities Deal in “the near future”.

Scottish Secretary David Mundell said: “The Autumn Statement announced an additional £800 million for Holyrood and this Budget allocates a further £350 million.

“That means, in the past year, the UK Government has set out an extra £1 billion investment in Scotland.

“It is now up to Holyrood to use this money, along with their raft of newly-devolved powers, to make the right decisions to grow Scotland’s economy.”

The Scottish Government has said that any additional funding for Scotland should be viewed in the context of the “huge cuts” it is already facing.

READ MORE: Budget: Tax breaks for North Sea to show ‘benefits of Union’



- Budget announcements deliver additional funding of £350 million for the Scottish government (£200 million for the Welsh government and almost £120 million for the incoming Northern Ireland Executive).

- Review of taxation of North Sea oil producers


- A package totalling £435 million will assist businesses affected by business rate rises, including £1,000 discount for most pubs.

- Introduction of quarterly reporting to be delayed by one year for businesses with turnover below the VAT registration threshold, costing the Treasury £280 million.

- No business losing small business rate relief will see their bill increase next year by more than £50 a month

- A £300m fund for local councils to offer discretionary relief for hard-hit cases

- Clampdown totalling £820 million on tax avoidance to include action to stop businesses converting capital losses into trading losses, tackle abuse of foreign pensions schemes and introduce UK VAT on roaming telecoms services outside the EU.

- Tough new financial penalty for professionals who enable tax avoidance arrangements that are later defeated by HM Revenue and Customs.

Personal tax, savings and pensions

- The main rate of class 4 National Insurance contributions to increase by 1% to 10% in April 2018 and 11% in April 2019, raising £145 million a year by 2021/22 at an average cost of 60p a week to those affected.

- Tax free dividend allowance to be reduced from £5,000 to £2,000 from April 2018.

- -Mr Hammond confirmed the Government’s commitment to increase thresholds for income tax to £12,500 for basic rate and £50,000 for the higher rate by the end of this Parliament.

Excise duties

- Soft drinks levy to be imposed at 18p and 24p per litre for the main and higher bands.

-No change to previously planned upratings of duties on alcohol and tobacco, but a new minimum excise duty is introduced on cigarettes based on a packed price of £7.35.

- Vehicle excise duty rates for hauliers and the HGV Road User Levy frozen for another year


- Schools White Paper will remove barriers to creation of faith based and selective free schools, with funding for a further 110 new free schools on top of the current commitment to 500.

- Free school transport extended to all children on free school meals who attend selective schools.

- New T-Levels to be introduced for technical education through the further education route.

- Number of hours of training for technical students aged 16 to 19 to be increased by more than 50%, including a high quality three month work placement.

- University-style maintenance loans for those undertaking higher level technical qualifications at Institutes of Technology and National Colleges.

- Investment of £40 million in pilots of lifelong learning schemes.


-Additional £325 million of capital to allow the first NHS Sustainability and Transformation Plans to proceed.

-Additional £100 million available immediately for onsite GP triage in NHS A&E departments.

Social care

- An extra £2bn for social care over next three years, with £1bn available in the next year

- Long-term funding options to be considered but so-called “death tax” on estates ruled out


-New funding totalling £20 million to support the campaign against violence against women and girls.

-Funding of £5 million to support people returning to work after a career break.

-The Government commits £5 million to projects celebrating the centenary of the 1918 law giving women the vote.

-New measures to protect consumers from unexpected fees, ahead of a green paper on protecting the interests of consumers.

- Mr Hammond allocated £300 million to support 1,000 new PhD places and fellowships in STEM subjects, £270 million for new technologies like robots and driverless vehicles, £16 million for 5G mobile technology and £200 million for local broadband networks.