Westminster budget delay shows 'contempt for Scotland', claims Derek Mackay

Scotland's finance secretary has criticised a pledge by the Conservatives to not table a UK Budget until February if the party is returned to power after next week's general election.

Delaying the budget means the Scottish Government will not know how much funding is available and will complicate Holyrood's ability to allocate resources to public services, Derek Mackay said today.

It also leaves the Scottish Parliament with potentially only weeks, instead of months, to scrutinise and debate its own budget.

In a statement of intent for the first 100 days of a Conservative government at Westminster, Boris Johnson said today his top priorities would include a "Brexit budget" in February.

Holyrood finance chief Derek Mackay has criticised a Tory plan to delay the UK Budget until February. Picture: John Devlin

The Tories claimed a February budget would allow Mr Johnson to deliver on a manifesto commitment to cut taxes for working people.

The Scottish Government had been due to publish its draft budget for 2020/21 on December 12. The postponement of the Westminster budget – which had been scheduled for November 6 – had already thrown the status of the Holyrood budget into doubt.

Mr Mackay said: “The Tories have a long track record of ignoring the needs of the people of Scotland, but delaying the UK budget until February – just weeks before the new financial year – is nothing short of contempt for Scotland and for devolution.

“Having wrecked their own parliamentary processes, they want to damage ours too.

“Under the current arrangements, we need a UK budget, before we can set the Scottish budget. Without it we are operating with both hands tied behind our back, making it impossible to plan with any certainty.

“Boris Johnson clearly doesn’t understand Scotland, devolution or simple good governance.

“If Boris Johnson is able to win a majority next week it will simply add to the economic uncertainty being caused by Brexit that is putting substantial strain on Scotland’s public services. The UK Government was ready to present a budget in early November, so there is no good reason to delay it for two months after the election.”

The Fraser of Allander Institute (FAI) said "one of the ironies of fiscal devolution is that the outlook for the Scottish budget is, if anything, more dependent on the outcomes of the UK budget than it was previously".

In a blog post on the issue, published last month, the FAI said: "The spending decisions of the UK Government effect the Scottish block grant, via the Barnett Formula.

"The Office for Budget Responsibility (OBR) forecasts of UK income tax revenues also affect the Scottish block grant.

"This is because the size of the deduction made to the Scottish block grant (to reflect the transfer of revenues from Westminster to Holyrood, and known as a block grant adjustment or BGA) is calculated based on the forecast growth of income tax revenues in the rest of the UK.

"In turn, OBR forecasts of rUK income tax revenues also depend on UK Government tax policy decisions. An increase in rUK income tax rates will affect the Scottish block grant directly (by increasing the size of the BGA, reflecting higher revenues foregone by the UK Government from Scotland). Changes to UK income tax policy will also affect the Scottish budget indirectly, by influencing the perceived political acceptability of a given tax policy in Scotland.

"And because income tax is a shared tax, UK Government decisions on things like the level of the Personal Allowance can affect the forecasts of Scottish income tax revenues."