£8.3bn spent and hard choices loom, watchdog warns

Financial pressures spelled out in auditor’s report

‘Uncertainty and volatility’

MINISTERS face ‘difficult decisions’ as they balance Covid spending with financial pressures and budget uncertainty, watchdogs have warned.

The Scottish Government has so far spent £8.3billion on the pandemic, with at least a further £4.9billion to be spent by the end of 2021-22.

In a report published today, Audit Scotland warns of budgetary planning issues due to pre-pandemic spending pledges and volatility in finances.

The report states: ‘It will be challenging to match spending to the available funding in the coming years.

‘This will need to be done in a way that minimises the disruption to individuals, public bodies and services, ensures value for money is maintained and avoids unintended consequences.’

Auditor General Stephen Boyle, the head of the agency, said: ‘As Scotland moves into the recovery phase from the pandemic, it will likely become increasingly difficult to define what is, and what isn’t, Covid-19 spending.

‘The Scottish Government is managing financial pressures which predate the pandemic, such as spending on health and social care.

‘That means difficult decisions lie ahead and, despite the challenges, it increases the need for a medium-term plan to manage the levels of uncertainty and volatility facing the Scottish budget.’

Transparency has also suffered due to the pandemic, the report said, due to the fast-paced nature of the emergency.

The report said the Scottish Government must continue to update its medium-term financial strategy to ‘ensure the wider context for the 2022-23 budget and beyond is understood’.

The report claimed the Government was reviewing past spending decisions to collate all Covid-19 related pledges, and said it will become harder to classify coronavirus-specific spending as the country moves into the recovery phase.

Scottish Conservative finance spokesman Liz Smith said: ‘I think the public will find it unacceptable that the Scottish Government has been distributing Covid-19 funds without fair and proper scrutiny.

‘The public will be deeply concerned by the secrecy and the lack of information on where so much funding went. Yet again, the SNP are blatantly attempting to dodge accountability and hide from their longterm failures.’

She said the Government must make its pandemic spending open to ‘fair and comprehensive scrutiny’.

Audit Scotland’s report also stressed the need for effective communication at all levels of government to understand the impact measures are having.

A Government spokesman said: ‘We are pleased Audit Scotland recognises the challenge the Scottish Government faces in managing its budget without clarity on how much funding it will receive.

‘Despite repeated requests, the UK Government has so far refused to guarantee the level of Covid-19-related Barnett consequentials this year, despite doing so in 2020-21.

‘We continue to press for this certainty, along with the additional fiscal flexibilities which would enable us to drive Scotland’s pandemic recovery more effectively.’