More funding needed for pay deals

The UK Government has been urged to provide additional funding for public sector pay deals or the Scottish Government may be unable to fund equivalent offers without cuts to public services, according to Deputy First Minister John Swinney.

In a letter to the Chancellor of the Exchequer Nadhim Zahawi, Mr Swinney outlines concerns that last year’s UK Spending Review, which determined the majority of the current Scottish Budget, did not take into account the level of pay increase recently proposed by the independent pay review bodies.

Mr Swinney also warned that the UK Spending Review did not consider the wider effects of rising inflation and that without any further funding, the Scottish Government may only be able to propose similar pay rises by reducing budgets elsewhere which would have a knock-on impact on the public sector’s ability to respond more widely to the cost of living crisis.

Mr Swinney's letter to the Chancellor can be read online.

Background

On 15 July, the Finance Ministers for the three devolved governments wrote to the Chancellor outlining economic areas of concern ahead of the forthcoming UK Budget.