Scotland's top civil servant blames SNP Government's financial woes on 'economic shocks'

The outgoing permanent secretary of the Scottish Government has blamed a lack of financial sustainability on economic “shocks” he branded “unprecedented”.

Scotland’s most senior civil servant has blamed the Scottish Government's lack of financial sustainability on a string of economic “shock” events as he insisted he is “confident” NHS waiting times will finally come down this year.

Permanent secretary John-Paul Marks was speaking in front of Holyrood’s public audit committee on Wednesday ahead of him stepping down to take up a role at HM Revenue and Customs.

The SNP's deputy first minister Kate Forbes, First Minister John Swinney and finance secretary Shona Robison (Picture: Jeff J Mitchell) | Getty Images

Mr Marks was pressed by MSPs over the lack of financial sustainability within the Scottish Government, set out in a stark Audit Scotland report.

The report warned “the Scottish Government continues to take short-term decisions, reacting to events rather than making fundamental changes to how public money is spent”.

READ MORE: 'Devoted': Why Scotland's top civil servant is leaving his post after three years of serving SNP Government

The document added: “This approach has so far been effective in balancing the Budget, but risks disrupting services at short notice and restricting progress towards better long-term outcomes for people.

“The gap between the Scottish Government’s spending and funding is forecast to continue to grow in coming years.”

Mr Marks stressed the Scottish Government had balanced its Budget each year and highlighted fiscal shocks for disrupting public finances.

John-Paul Marks is standing down as Permanent Secretary to the Scottish Government. Picture: Andrew Cowan-Pool/Getty Images | Andrew Cowan-Pool/Getty Images

Pressed by Labour committee convener Richard Leonard over “a culture of reaction rather than pro-activity” within the Scottish Government, Mr Marks said: “We have been hit by a set of shocks over the last few years that have been pretty unprecedented and we’ve, of course, had to respond to those.

“We have faced some radical shifts in our operating environment and our funding position, in-year, pretty much every year since I’ve been permanent secretary.”

He said that when he took up his role in 2022, at the peak of the Covid Omicron variant outbreak, “all of a sudden, all of the Covid consequentials that had been put in place were no longer [there]”. But he said “the level of demand that was in our education system, our justice system, our health system was still there”.

Mr Marks said in 2023 “inflation hit unprecedented levels that we’ve not seen before”, which he warned “had a hugely disruptive effect on public sector pay assumptions”.

READ MORE: 'Breathtaking hypocrisy': SNP government's 'staggering' wages bill revealed

He said “last year, we were all set to publish all the medium-term documentation”, but that John Swinney being appointed First Minister, the UK general election and “a significant change in public spending strategy from a new Chancellor” has derailed the plans.

Mr Marks said: “There’s no doubt, when I look back on my time as permanent secretary, there have been a set on in-year shocks that we’ve had to respond to.”

But he added “we’ve got to balance the Budget”, adding it was “a legal requirement” and was "non-negotiable".

Emergency spending cuts were put in place last year by SNP Finance Secretary Shona Robison, largely due to public sector pay deals being agreed above the level planned for.

Conservative MSP Jamie Greene told Mr Marks that Scots “expect to see improved services”, with an increasingly large proportion of the Budget spent on the NHS.

The permanent secretary said he believed Scots would finally begin to see health service improvements and waiting times coming down this year.

The Scottish Government has vowed to finally get a grip of NHS waiting times

He said: “We know we need to improve performance and we want to continue to do that after the shock of the pandemic and also inflation. Flu was very high this winter as well.

“I’m confident, but cautious because we need to make sure the investment reaches the front line that we should see in this year, given the Budget and the choices that have been taken, a reduction in waiting times and a reduction in the elective care backlog.”