Meeting of the Parliament 13 January 2026
Today I present a budget for Scottish families, for a stronger national health service and for investment in Scotland’s infrastructure. As a result of the decisions that I am announcing, some of the pressure on families and family budgets will ease; there will be more operations and appointments in our health service and it will be easier to access a general practitioner; college funding will grow, giving our young people more opportunities to learn and flourish; life will be a little easier for parents, with more wraparound childcare; and more young Scots will be able to find a home that they can love and can afford, which will help them to build a more secure future right here in Scotland.
The Government wants what is best for Scotland. That is why we will continue to offer and expand the best cost of living support package anywhere in the United Kingdom. My message to the people of this country is clear: thanks to our cost of living commitments, they will be better off in so many ways because they live in Scotland and because Scotland is led by the Scottish National Party.
I am very proud to present a budget for Scotland with an investment of almost £68 billion in the wellbeing of our people and the future prosperity of our nation. I also present our multiyear spending plans. Given a total investment of almost £200 billion, the Scottish spending review and the infrastructure investment pipeline demonstrate the scale of our ambition for our nation.
I will begin today where I left off in my budget last year. Just over a year ago, I announced in the chamber our intention to scrap the cruel two-child cap. That was widely welcomed across Scotland, but the representatives in this Parliament of the UK’s governing party could not bring themselves to vote for it. It has taken the UK Government almost a year to catch up, but I am pleased that it has done so.
The Scottish Government will now go further and do more. Instead of mitigating yet another damaging Westminster policy, we can use the £126 million that is released for the coming year to keep even more Scottish children out of poverty.
Our aim is to target all those extra resources in the most effective way, to ensure maximum impact on those families in greatest need by increasing their income and reducing their costs. That means, this year, as part of a £50 million whole-family support package, specific additional support for colleges as part of on-going initiatives to raise income through skills and education, so that people can find work, or better-paid work; action to remove transport barriers that make it difficult for some to access work; and additional resources for key third sector partners to target more precisely those families who are hardest to reach. It means a further £49 million this year for measures that we will announce in the updated child poverty delivery plan in March, as we strive to reduce child poverty faster and further.
In 2026-27, the transformational Scottish child payment will, of course, increase with inflation. In 2027-28, because of the choices that have been made in this budget, we will go further, by boosting to £40 a week the payment for families with a baby under one. The first year of a baby’s life is one of the most exciting times for any family, but we know that that time can also bring extra stress and costs. That is why the Government is delivering the strongest package of support for families with young children anywhere in the UK, from the baby box to best start payments and, of course, our game-changing Scottish child payment. That support for mums and dads will help them through the critical first year of their child’s life, delivering the best start in life for children and for families. That commitment speaks to who we are as a Government and to our values and ambition for each and every child in our land.
To deliver even more for those with the least, we will ask those with the most—the very wealthiest—in our land to contribute that little bit more. That includes the introduction, by April 2028, of two new council tax bands for the most expensive properties in Scotland, which will be those that are worth more than £1 million on an up-to-date valuation. That measure will bring greater fairness as well as increased revenues to councils.
From April 2027, the air departure tax will come into force and we will shortly launch a consultation on a new Highlands and Islands exemption continuing to exempt domestic flights. Through that new framework, we will introduce a private jet tax. Those who choose to travel by private jet in Scotland will pay a fair share for that privilege. In doing so, they will help us to make Scotland the fairer nation that we all know it can and should be.
Self-government works for Scotland. The choices that we can make in this, our national Parliament, make a real difference for the people we serve. Our choices mean that child poverty in Scotland is at a 30-year low and it has been falling in Scotland while it has risen elsewhere on these isles. That has been achieved because we can build a social security system that is more compassionate and a tax system that is more progressive.
Decisions taken by this Parliament and Government have played a key role in reducing carbon emissions in Scotland by more than half. Public health has been advanced, with Scotland taking the lead on action to reduce the harm from alcohol and through transformational measures such as the human papillomavirus vaccination.
The amount of electricity that is generated by renewable sources has increased more than fourfold since 2008—a step change that should mean substantially lower energy bills and will mean lower energy bills when Scotland’s energy is in Scotland’s hands.
Electrification of key rail routes has improved journeys for tens of thousands of commuters, and ScotRail has been brought into public ownership. We have been able to replace the UK’s costly private finance initiative with a more cost-effective alternative, which has, in turn, enabled us to build hundreds of new schools and substantially upgrade hundreds of others.
We have abolished Thatcher’s right to buy, which means that, after years when the number of socially rented homes was falling, it is once again increasing in Scotland. Indeed, since 2007, we have delivered more than 141,000 affordable homes, 101,000 of which have been for social rent.
Scotland has been changed for the better by this Parliament and by this SNP Government, but we are determined to go further. That is why this budget is focused not only on securing the gains that have been made but on moving forward to take the best next steps for our nation. When decisions about Scotland are taken here in Scotland by a Government that puts the people of Scotland first, transformational change can and does happen.
This budget is focused on delivery and hope, on a stronger NHS and on a brighter future for Scotland and the people who live here. It will direct more public spending to the front line. At its very heart is a commitment to effective and efficient policy delivery through a more modern public sector and smarter use of technology, including digital delivery, making it easier for citizens to access the services that they need.
Our approach to public sector reform will deliver £1.5 billion in efficiencies, helping us to protect front-line services from the worst impacts of a tightening fiscal environment, caused not least by the constraints that the UK Government has put on Scotland’s budget, including the near £400 million shortfall in funding as a result of the chancellor’s decision to increase employers’ national insurance contributions.
Our ambition is clear: a Scotland where public services work seamlessly for people, are modern in their design and delivery, are accessible where and when they are needed, are flexible in how they respond and are consistently focused on the best outcome. In short, public services that are centred on the needs of the citizen, not the needs of the system.
Of course, for the budget to pass and for the benefits to be felt by families across Scotland, we need support and votes from other parties across the chamber. As before—[Interruption.]