Meeting of the Parliament 30 January 2025
We take any issues that are raised by the committee seriously, and we will seek to respond to them in as positive a way as we can. However, I am aware that the Minister for Public Finance has had quite deep engagement with the committee on his work on public service reform, and I know that he is keen to continue that engagement on the detail of that work.
On the PSR invest to save fund, I am pleased to confirm that we have written to public bodies to provide guidance and an application form to invite funding bids. I am happy to write separately to the committee to share that information.
I want to move on to recognise some key points that were raised by the other committees in their budget scrutiny. Eradicating child poverty, which is the Government’s top priority, has been of interest to a number of committees. The Joseph Rowntree Foundation’s report “UK Poverty 2025” is clear that only Scotland is expected to see child poverty rates fall by 2029, with rates forecast to rise in England, Wales and Northern Ireland. That is recognition that the action that is being taken in Scotland is reducing child poverty, but more work has to be done.
The budget invests significantly to reduce the pressure on household budgets by allocating more than £3 billion a year to policies that tackle poverty and the cost of living. The Government is going further to prioritise action to develop the systems to mitigate the two-child limit, which could lift 15,000 children out of poverty. More widely, the new budget will invest £768 million in the affordable housing supply programme next year, an investment that was welcomed by the Economy and Fair Work Committee, which highlighted the lack of affordable housing supply.
It is a sad fact that poverty leads to lower achievement at school and beyond. That is why the Government will invest more than £1 billion in high-quality funded early learning and childcare as part of the budget. The new budget also includes £186.5 million for local authorities to maintain teacher numbers and £29 million for additional support needs to support the recruitment and retention of the ASN workforce, the latter of which is of particular interest to the Education, Children and Young People Committee.
Growing the economy and delivering on our net zero ambition are strategic priorities for the Government and are of interest to multiple committees. We are almost tripling our investment in offshore wind to £150 million, which will support the economy and help to deliver on our net zero ambitions.
To deliver our programme of support for Scotland’s businesses, the 2025-26 budget provides £321 million for our enterprise agencies, which is an increase of £14 million from 2024-25.
More broadly, in 2025-26, the budget commits £4.9 billion of investment with a positive benefit for climate. Our strong focus on sustainable transport means that nearly £2.9 billion will be invested in public transport infrastructure and green initiatives.
Delivering and supporting high-quality sustainable public services is a priority for all of us across the chamber, which is why the budget provides a record £21.7 billion for health and social care. That investment will increase capacity as well as focusing on driving productivity and optimising existing resources.
The budget recognises the importance of local government and will provide local authorities with a funding package of more than £15 billion in 2025-26. The Local Government, Housing and Planning Committee has called for a reduction in ring-fenced funding, and I am pleased to say that the 2025-26 budget baselines a further £524.9 million of local government funding.
I appreciate that all budgets in the public sector are under pressure. I intend to give guidance on employer national insurance contributions to all public sector organisations, including local government, as soon as possible.