Scottish Government's Medium Term Financial Strategy: May 2019

Part II – Spending Outlook

This part of the Medium-Term Financial Strategy provides the high-level framework for a Scottish Government Spending Review.

This is the first time that such a framework has been published. It follows a recommendation from the Budget Process Review Group and is part of a subsequent agreement between the Scottish Government and the Finance and Constitution Committee of the Scottish Parliament:

• “There is a presumption that the Scottish Government will carry out a Spending Review, linked to the equivalent UK Spending Review. Where the Scottish Government plans to diverge from linking a Spending Review to the UK equivalent then it will write to the Finance and Constitution Committee setting out the reasons for doing so.
• At a Spending Review, the Scottish Government will publish a framework document setting out the economic and political context, the criteria which will govern the assessment of budgets and the process and timetable for review. The framework document will be published prior to Summer recess in order to allow sufficient time for parliamentary scrutiny and input into the Spending Review.
• The Parliament’s committees should undertake a constructive dialogue with Ministers, public bodies and stakeholders once the framework document is published in order to influence the outcome of the Spending Review.”

At the UK Spring Statement on 13 March 2019, the Chancellor confirmed that a UK Spending Review would conclude alongside the UK Budget if an EU exit deal was agreed. Given the “flextension” to 31 October 2019 for an EU exit deal to be agreed and the impending change of Prime Minister, arrangements for any UK Spending Review are not yet clear.