The Scottish budget: what you need to know

The Finance Secretary, has set out the Scottish Government’s budget plans for the year ahead.

Faced with continued Westminster cuts and the damaging impact of Brexit, we have chosen a different path for Scotland.


This is a budget that provides the investments we need to meet the challenges of today and seize the opportunities of tomorrow. Here’s what you need to know.


£400 million more for our NHS and more money direct to schools

The Tory government at Westminster plans to cut the budget available for public services in Scotland by half a billion over the next two years. By choosing a fairer path on taxation we will protect Scotland’s cherished public services.

The budget will ensure:

  • a £400 million increase in health spending;

  • £120 million direct to headteachers to raise attainment in schools;

  • protection for the frontline police budget and ensuring our emergency services keep VAT savings;

  • an increase in day to day spending on local council services; and

  • invest nearly a quarter of a billion in our plan to near double provision of childcare and early years education.

Seven in ten income taxpayers paying less than they are paying this year

Changes to Income Tax will make Scotland the fairest taxed part of the UK, with the majority of taxpayers paying less than if they lived elsewhere in the UK. And compared to last year, everyone earning less than £33,000 will pay less.


An end to the one per cent public sector pay cap

The cost of living is rising. Yet the UK government has failed to commit additional funding to end the one per cent public sector pay cap.

We will make a different choice. Next year we will deliver a minimum 3 per cent pay rise for public servants earning less than £36,500 – 75 per cent of public sector workers. For those earning more than £36,500 will receive a 2 per cent rise and a cash cap will be put in place on increases for those earning more than £80,000.


New investment to ensure Scotland is the best place to do business and invest

To grow our economy we will:

  • invest an extra £100 million to deliver the best business rates package in UK;

  • increase investment in business research and development by 70 per cent;

  • a £4 billion investment in vital infrastructure;

  • £340 million set aside for a National Investment Bank with a new £150 million Building Scotland Fund; and

  • begin procurement of the £600 million programme to deliver superfast broadband to all homes and premises.


Maintaining the social contract, ensuring Scottish taxpayers get the best deal anywhere in the UK


With the cost of living rising, our commitment to a social contract with the people of Scotland is more important than ever. This budget will continue to fully fund an NHS free at the point of need; maintain free university tuition; and free personal and nursing care.


To strengthen the social contract this budget will:

  • implement Frank’s Law, providing free personal care to those who need it;

  • increase Carers Allowance;

  • provide free access to sanitary products in schools, colleges and universities;

  • and continue to provide all babies with a Baby Box of essential items for their first weeks and months.


New action to fight poverty and inequality


To build a fairer Scotland, this budget will:

  • invest £756 million towards our pledge to build 50,000 affordable homes in this Parliamentary term;

  • begin investment of the £50 million End Homelessness Together Fund;

  • begin investment of the £50 million Child Poverty Fund; and

  • maintaining £100 million a year investment to mitigate welfare cuts, including fully mitigating the Bedroom Tax.