The SNP has been accused of “eyewatering” mismanagement after a report from economists at the Frazer Allander Institute showed that the SNP must address a £1 billion funding gap on resource spending.
The figure is expected to rise to £1.5 billion when capital commitments are included, the report said.
It warned that the fiscal situation in Scotland is likely to be “quite tight” in the years after 2024/5.
Scottish Conservative shadow finance and local government secretary Liz Smith said: “This eye-watering report only highlights the SNP’s astonishing mismanagement of Scotland’s finances.”
The SNP has been accused of “eyewatering” mismanagement
PA
Speaking to the Scottish Express, she added: “All the signs are pointing towards Humza Yousaf trying to tax his way out of an ever-growing financial black hole.
“That would be naïve in the extreme and as the Fraser of Allander point out, a new higher tax band would barely make a dent in that deficit.
“The SNP’s budget looks set to widen the tax gap further between Scotland and the rest of the United Kingdom while ministers simultaneously refuse to accept responsibility for their abject economic failings.”
Speaking about the report, Professor Mairi Spowage, Director of the Fraser of Allander Institute, said: “This large funding gap will mean difficult choices for the Scottish Government on what to prioritise.
“In a devolved context, this gap cannot be allowed to manifest in practice, so steps will need to be taken to address it.
“Of course, the DFM may choose to use powers over income tax to raise more revenue to plug this gap, but it is unlikely that this would be sufficient in isolation.
“Significant spending cuts are also likely to be required – the DFM has the unenviable task of choosing where the axe will fall.”
She added: “It is quite difficult to know what the outlook for the Scottish budget past 24/25 is, but I think that it’s going to be quite tight and quite difficult.”
But a Scottish Government spokesperson said: “The Deputy First Minister has been very clear Scotland is facing one of the most challenging budget settlements since devolution as a result of sustained high inflation and a UK Government Autumn Statement that failed to deliver the investment needed in Scotland’s public services.
“In May, the Deputy First Minister set out in our Medium- Term Financial Strategy how we will ensure Scotland’s finances remain on a sustainable footing.
“The Scottish Budget will build on this, outlining the tough choices that have been required to target funding at our three key missions – equality, community and opportunity.”
