How £70 million of National Insurance funding was spent: FOI release

Information requested

Information regarding how £70 million of National Insurance funding received from the UK Government was to be spent and the interaction with local government funding.

Response

1. The National Insurance consequentials formed part of the Scottish Government's overall settlement for 2022-23. Consequentials are allocated to the Scottish Government as a whole and it is for Scottish Ministers to decide how they should be allocated based on their priorities. Scottish Ministers subsequently published their spending places in the Scottish Budget which included a Total Local Government Settlement of £12.5 billion. This was increased by a further £120 million during the passage of the Budget Bill.

2. Following the additional £120 million announced by the Cabinet Secretary for Finance and Economy during Stage 1 of the Budget Bill on 27 January, the 2022-23 Local Government Finance Settlement of almost £12.7 billion represents a cash increase of £1.1 billion or 9.2 per cent, which is the equivalent of a real terms increase of 6.3 per cent, compared with 2021-22. The additional £120 million of funding represents the equivalent of a 4 percent Council Tax rise.

3. The Scottish Government's policy towards local authorities' spending is to allow local authorities the financial freedom to operate independently. As such, the vast majority of funding is provided by means of a block grant. It is the responsibility of individual local authorities to manage their own budgets and to allocate the total financial resources available to them on the basis of local needs and priorities, having first fulfilled their statutory obligations and the jointly agreed set of national and local priorities.

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