The Scottish government's Tax Strategy will be published alongside the 2025/26 Scottish Budget, confirms Shona Robison.

She says the cumulative decisions on income tax raised an extra £1.5bn compared to if Scotland had UK rates and bands.

Anyone who would advocate removing the progressive changes to income tax in Scotland will need to set out where the £1.5bn worth of cuts would fall as a consequence, she says.

The finance secretary tells the chamber that since 2007, Scotland’s economy has grown faster than the UK as a whole, after accounting for population growth, and productivity has grown twice as quickly.

She stresses that boosting economic growth is a top priority for her government.

The NHS is 'politically untouchable'published at 15:35 British Summer Time 3 September 2024

15:35 BST 3 September 2024

Lynsey Bews
BBC Scotland political correspondent

From Shona Robison's speech, it sounds like health will be a largely protected area. The NHS is almost politically untouchable - any hints of cuts or privatisation are seen as toxic.

She says there will be a "twin approach of investment and reform" in this area, adding that it will also mean "realigning spend to ensure it reaches those that most need it".

That doesn't necessarily mean removing universal services - instead I suspect it's about trying to spend money more efficiently.

The finance secretary says significant pressures on capital budget and high level's of inflation in the construction sector has increased the cost of delivering infrastructure.

The Scottish government's Financial Transaction allocation from the UK government has dropped by £290m - or 62% - since 2022/23, she says.

Robison says these factors mean the Scottish government cannot afford all capital commitments and "difficult decisions" are required to ensure the capital programme remains affordable and deliverable.

Robison says the government will continue to deprioritise lower impact spend and programmes.

She says the forthcoming budget will highlight how the government will "double down" on reform opportunities and "maximise efficiencies".

The finance secretary says options to lower spending will consider estates, procurement, fund management and revenue raising.

The finance secretary says the Scottish government''s vision for health and social care reform will be taken forward.

She says the government will always prioritise funding for our NHS and in the 2025-26 budget, it will build on the record funding it has allocated in the current financial year.

"We will take the twin approach of investment and reform in our health services - an approach which rightly tackles the population health challenges we face," she adds.

"Where necessary that must mean realigning spend to ensure it reaches those that most need it."

Further significant action will be needed to reset the public finances onto a sustainable path, explains the finance secretary.

She says the Chancellor has made clear that UK government funding will continue to be tightly constrained.

Ahead of the Autumn Budget, she calls again on the UK government to ensure that it prioritises investment in public services and infrastructure.

She says: "We know from bitter experience that yet more Westminster austerity is not the answer, and public services must be protected."

However, she says if the Scottish government does not act, spending will continue to outstrip available funding.

"This is not sustainable and tough decisions will be required.

"On public spending, our approach to the forthcoming budget will be focused on action in areas key to addressing spending pressures, some of which I will highlight today."

The finance secretary gives further detail on where the £500m in savings will come from.

She says £60m of savings will come through Emergency Spend Controls, particularly targeting recruitment, overtime, travel and marketing.

A further £188m will be from "additional specific savings across all portfolios" - including cutting spending on sustainable and active travel, and via increased interest income on Scottish Water loan balances.

Up to £460m of additional Scotwind revenue funding will also be utilised, drawing from funding earmarked towards net-zero.

She also reiterates previously known changes, such as cutting free bus travel for asylum seekers, and an agreement with local government that they can draw on existing programmes to fund the pay deal, for a further £65m of savings.

The finance secretary says alongside pay, there are of course other pressures that arise in-year.

These include costs that emerge due to natural demand-led changes, for example legal aid, police and fire pensions, and the costs of accommodation for Ukrainian Displaced People.

Robison says more widely, the budget must still be managed for wider operational pressures.

For example NHS Boards are having to address the significant health and social care backlog that arose during the Covid pandemic and a recent further surge in Covid and respiratory cases.

She insists her government will do everything it can to protect people and public.

The cabinet secretary insists if Scotland were an independent country, it would not be paying the price for bad decisions taken at Westminster.

Lynsey Bews
BBC Scotland political correspondent

These are significant cuts - up to £500m of "direct savings", as Ms Robison puts it.

One of the areas being hit is sustainable and active travel. Given one of the government's key priorities is tackling the climate emergency, that's going to raise a few eyebrows.

Transport is a major contributor to emissions - so a decision to reduce funding here is going to anger environmental campaigners, and the government's former partners, the Scottish Greens.

Shona Robison confirms that up to £500m in savings will be introduced to support the 2024/25 budget for the Scottish government.

Lynsey Bews
BBC Scotland political correspondent

Shona Robison has pointed the finger of blame at Westminster.

Firstly, taking aim at the previous Tory government, arguing that it failed to review Scotland's funding settlements.

Secondly, targeting the new Labour government, which she says is set to continue austerity.

But the Scottish government's own fiscal forecasters say its own decisions have played a role in the difficult position in which it now finds itself.

The finance secretary is now saying that pay is a "significant driver of in-year pressures" and that up to £0.8bn is expected in additional costs for this financial year.

She says that it "remains to be seen whether the UK government will fully fund it", and if they do not then there will be a "substantial gap" between the workforce's expectations and available funding.

Robison adds that it must be recognised that Scotland has a larger public sector in Scotland compared with the rest of the UK. She adds that the public sector workforce will "need to evolve", and that further details will be provided in her budget.

The finance secretary reminds the chamber she made clear there was a difficult fiscal outlook in last year’s Medium Term Financial Strategy.

Shona Robison says she set out the projected, and growing, gap between forecast funding and planned spending in Scotland.

At the time this was forecast to be £1bn in 2024/25, rising to £1.9bn by 2027/28.

She says she announced a range of measures at budget 2024/25 to support the delivery of a balanced position while protecting public services.

Robison says she must take further and more urgent action now to ensure the Scottish Budget can be balanced in 2024/25.

The finance secretary begins her statement by reminding the chamber of the financial challenge ahead.

Shona Robison points to prolonged Westminster austerity and the impact of Brexit amongst other pressures.

She accuses the UK government of failing to review the adequacy of funding settlements.

Robison says the new Labour UK government has since confirmed the failures of the past administration.

Finance Secretary Shona Robison begins her pre-budget fiscal update, which is expected to announce substantial cuts to government spending.

These cuts are in part to help fund larger than expected public worker pay increases.

Budget black holespublished at 14:47 British Summer Time 3 September 2024

14:47 BST 3 September 2024

David Henderson
BBC Scotland Correspondent

There are enough black holes in the UK's public finances to excite astronomers, and frighten voters.

We're told three looming spending gaps have emerged in recent months.

Today's speech from Shona Robison will shed more light on just one of them.

During the election campaign, we heard much from the IFS thinktank and the SNP about the £18bn black hole in the UK's long-term finances.

Then, just after Rachel Reeves took the reins as Labour Chancellor, her Treasury team claimed to have found another - a £22bn black hole in the UK finances for this year.

And now, the Scottish government is looking to address a black hole in this year's devolved budget.

All three demand tough choices from ministers - and threaten painful spending cuts.

But the Scottish government faces a particular problem.

It is required by law to balance its budget - so ministers can't just borrow their way out of trouble.

Their options will be limited – with a key question being where to cut, and how deep?

Pay deals contribute to budget squeezepublished at 14:42 British Summer Time 3 September 2024

14:42 BST 3 September 2024

Philip Sim
BBC Scotland political correspondent

One of the biggest contributing factors to the squeeze on this year’s budget is public sector pay deals, which have cost far more than was originally allocated.

There have been loads of examples in recent weeks – indeed there were two this morning alone.

First council umbrella body Cosla announced an “above inflation” pay offer to teachers, with “additional funding” from the Scottish government. That funding has to come from somewhere.

Then the union Unison announced that local government staff it represents have rejected another pay offer – which might mean still more cash is required to ward off strikes.

That comes not long after the Scottish government announced a pay offer to NHS staff which would make them the best paid in the UK – terming the £448m cost as an “investment” – having spent the past year boasting of having avoided strikes by healthcare staff north of the border.

It’s a politically tricky area, given some negotiations are run by other groups (like Cosla) or subject to independent recommendations - and indeed no party is arguing against more generous settlements for valued workers.

But at the end of the day it’s still the Scottish government that has to find the funding, and wages now account for about half of Holyrood’s entire budget.

These are nagging problems for the current financial year, which Shona Robison will seek to address this afternoon. But they are also recurring costs which will weigh heavily on future budgets.

David Wallace Lockhart
Political correspondent

Many voices from Scotland’s arts and culture sector have been expressing concern about funding recently.

The issue has come up in Holyrood this afternoon, with Culture Secretary Angus Robertson saying that the government is “committed to increasing financial support to culture and the arts.”

He urged MSPs to wait for the update from the finance secretary due shortly, and he called on them to “welcome the good news to come.”

Sounds like there may be some better news for the arts when Shona Robison gets to her feet. Though plenty of other sectors can expect a bleaker picture.

The Fraser of Allander Institute, an independent economics think tank, is calling for transparency from the government on its spending plans – but says its expectations are “low”.

Posting on X, external, it says that while the size of the Scottish budget is primarily determined by decisions at Westminster, the Scottish government’s financial planning is “also part of the story”.

The think tank is looking for three things from the finance secretary’s announcement: clarity on how public finances have changed since the 2024-25 budget was announced in December; a rundown of where cuts are being made; and evidence of how decisions have been made, along with legally required impact assessments.

It adds: “Will we get this level of detail today? We’ll be honest, given the Scottish government’s track record on budget transparency, our expectations are low.”

Speaking ahead of today's statement, the UK government said "tough decisions" were necessary "to restore economic stability and address the £22bn hole in the public finances left by the last government".

A spokesperson said: "This is a challenge facing the whole of the UK, including Scotland.

“The chancellor reiterated this in a constructive meeting with the first minister and finance minister in Glasgow last week.

"We are committed to working with the Scottish government on our shared priorities to fix the foundations of our economy, so we can rebuild Britain and make every part of the United Kingdom better off.”