Budgeting on heroic assumptions

Suppose you're the careful budgeting type, you need to make ends meet, there's very little room for extra borrowing and you have £30,000 carefully allocated for the year ahead. A lot of it is already committed.

Now imagine you get allocated another £3,000, and a bit more after that, taking it up to £8,600. And a further £1,100. Increased by nearly a third, your budgeting has been overtaken by events. Sounds like a nice problem to have?

Now, imagine that extra funding is to deal with a hugely expensive and disruptive family health crisis, for which it's unclear how or when the outcome will come.

The money you set aside for a foreign holiday and eating out can't be spent, because it turns out that you're not allowed either.

Maybe not so easy to handle.

That might give some notion of the scale of disruption to budgeting in St Andrew's House in Edinburgh.

It used to be the case that civil servants and ministers would listen out for extra funding in response to English spending pressures, and a predictable share of that would arrive in Holyrood's bank account.

Familiar narrative

This year, with unprecedented additional funding to tackle the Covid crisis effect, particularly on health and business, that link has broken.

A minimum guaranteed sum arrives, but it's unclear why, what English spending it's attached to, and therefore how much more can be expected.

That makes it very difficult to retain the familiar narrative of "England spends, so Scotland spends at least as much".

The Scottish government likes to claim "you're better off, or no worse off", but when that isn't the case, the opposition pounces.

Going into the May elections for Holyrood, Scottish Conservatives want to challenge the claims that the Treasury is not funding particular projects.

Tories cite, as an example, a continued business rates holiday for retail, hospitality and leisure, beyond the three months already committed.

That could be afforded, goes the Conservative argument, if SNP ministers choose to prioritise it. The cost next year, they say, would be £550m.

Likewise a "school catch-up plan" with more teachers and tutoring, which is also costing £550m over five years.

Election battle lines are being drawn. With the budget for the financial year starting in April looking as fluid and unpredictable as the one that's soon to end, and with Tories at Westminster letting rip with both deficit and debt, financial constraints on all parties in the election debate are loosened.

It's as if everything becomes possible, if you choose to make it so.

Watch out for heroic assumptions in the outline budgets behind manifesto plans, and listen hard for talk of the trade-offs between those different priorities.