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| Version 1 | Version 2 |
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| Public sector has to absorb UK tax cost - Forbes | Public sector has to absorb UK tax cost - Forbes |
| (about 2 hours later) | |
| Kate Forbes says the government cannot "invent" money to cover the shortfall | Kate Forbes says the government cannot "invent" money to cover the shortfall |
| Scotland's public sector will have to "absorb" a shortfall in funding to cover a UK government tax rise, Deputy First Minister Kate Forbes has said. | Scotland's public sector will have to "absorb" a shortfall in funding to cover a UK government tax rise, Deputy First Minister Kate Forbes has said. |
| The SNP minister signalled the NHS, councils and other public bodies would have to make cuts unless the Treasury offered more cash to offset a UK-wide hike in employers' National Insurance contributions. | The SNP minister signalled the NHS, councils and other public bodies would have to make cuts unless the Treasury offered more cash to offset a UK-wide hike in employers' National Insurance contributions. |
| The Scottish government says it is facing a shortfall of more than £200m to cover extra costs for public sector staff. | The Scottish government says it is facing a shortfall of more than £200m to cover extra costs for public sector staff. |
| The Treasury says it is providing a record budget to Holyrood and it is up to SNP ministers how to spend it. | The Treasury says it is providing a record budget to Holyrood and it is up to SNP ministers how to spend it. |
| 'We can't invent money' | 'We can't invent money' |
| Forbes told BBC Scotland News: "We know that there will be a shortfall in covering National Insurance contributions for the public sector. | Forbes told BBC Scotland News: "We know that there will be a shortfall in covering National Insurance contributions for the public sector. |
| "At the moment the public sector will have to absorb that. | "At the moment the public sector will have to absorb that. |
| "In the same way that we can't invent money to cover this we ultimately have to balance our budget and we balance our budget by ensuring that we cover all costs. | "In the same way that we can't invent money to cover this we ultimately have to balance our budget and we balance our budget by ensuring that we cover all costs. |
| "And there will be an expectation on all parts of the public sector, just as there is in the private sector, to ensure that they cover their tax liabilities." | "And there will be an expectation on all parts of the public sector, just as there is in the private sector, to ensure that they cover their tax liabilities." |
| The Scottish government estimates the increase in employers' National Insurance contributions will cost about £550m for public sector workers, rising to £750m when indirect employees such as those in childcare, higher education or social care are included. | The Scottish government estimates the increase in employers' National Insurance contributions will cost about £550m for public sector workers, rising to £750m when indirect employees such as those in childcare, higher education or social care are included. |
| Holyrood ministers have been told to expect about £300m in compensation from the Treasury. It has based this figure on the Barnett formula – designed to give devolved nations a proportionate share of spending in England. | Holyrood ministers have been told to expect about £300m in compensation from the Treasury. It has based this figure on the Barnett formula – designed to give devolved nations a proportionate share of spending in England. |
| Finance Secretary Robison described that total as "unacceptable" and "very low" based on the Scottish government's projections using the same formula. | Finance Secretary Robison described that total as "unacceptable" and "very low" based on the Scottish government's projections using the same formula. |
| The rate of employer National Insurance contributions is increasing in April from 13.8% to 15%. The threshold at which employers have to start paying the contributions are also being lowered from £9,100 to £5,000. | The rate of employer National Insurance contributions is increasing in April from 13.8% to 15%. The threshold at which employers have to start paying the contributions are also being lowered from £9,100 to £5,000. |
| About 600,000 people are employed in Scotland's public sector, making up 22% of the total workforce – compared to about 17% in the UK as a whole. | About 600,000 people are employed in Scotland's public sector, making up 22% of the total workforce – compared to about 17% in the UK as a whole. |
| Scotland's public sector is also relatively better paid than the UK workforce. | Scotland's public sector is also relatively better paid than the UK workforce. |
| Holyrood's finance committee convener Kenneth Gibson has questioned the government's plan to deal with the National Insurance shortfall | Holyrood's finance committee convener Kenneth Gibson has questioned the government's plan to deal with the National Insurance shortfall |
| The Scottish government has not set aside funds in its Budget - which is due to pass next month - to cover the expected shortfall in compensation, with Holyrood's finance committee questioning how ministers intend to deal with it. | The Scottish government has not set aside funds in its Budget - which is due to pass next month - to cover the expected shortfall in compensation, with Holyrood's finance committee questioning how ministers intend to deal with it. |
| A warning of potential cuts from Forbes comes as public sector workers appeal for more funding and urgent reform. | A warning of potential cuts from Forbes comes as public sector workers appeal for more funding and urgent reform. |
| The British Medical Association Scotland recently said that the NHS would struggle to make it through another year without urgent reforms, while Scotland's public finance watchdog warned councils faced a "challenging future, with significant financial risks and uncertainties". | The British Medical Association Scotland recently said that the NHS would struggle to make it through another year without urgent reforms, while Scotland's public finance watchdog warned councils faced a "challenging future, with significant financial risks and uncertainties". |
| The finance committee raised further concerns about the government over "extended delays in publishing key strategic financial documents". | The finance committee raised further concerns about the government over "extended delays in publishing key strategic financial documents". |
| SNP MSP and committee convener Kenneth Gibson said: "This is indicative of a wider problem where vital medium and longer-term financial planning within the Scottish government is lacking." | SNP MSP and committee convener Kenneth Gibson said: "This is indicative of a wider problem where vital medium and longer-term financial planning within the Scottish government is lacking." |
| The cross-party group also called for greater transparency about public sector pay after ministers had to use emergency measures in the current financial year to fund higher than predicted pay deals. | The cross-party group also called for greater transparency about public sector pay after ministers had to use emergency measures in the current financial year to fund higher than predicted pay deals. |
| Forbes called for the UK government to provide long-term clarity on its spending plans. | Forbes called for the UK government to provide long-term clarity on its spending plans. |
| She told BBC Scotland News: "It's very difficult as you'll understand to set a multi-year budget when you don't have clarity on the multi-year budget you might get from the UK government." | She told BBC Scotland News: "It's very difficult as you'll understand to set a multi-year budget when you don't have clarity on the multi-year budget you might get from the UK government." |
| A Treasury spokesperson said the Scottish government receives more than 20% extra funding per person than equivalent UK government spending. | A Treasury spokesperson said the Scottish government receives more than 20% extra funding per person than equivalent UK government spending. |
| They added: "It is for the Scottish government to allocate this across its own public sector and meet the priorities of people in Scotland. | They added: "It is for the Scottish government to allocate this across its own public sector and meet the priorities of people in Scotland. |
| "It will also receive additional Barnett funding on top of this record £47.7bn settlement as part of support provided in relation to changes to employer National Insurance." | "It will also receive additional Barnett funding on top of this record £47.7bn settlement as part of support provided in relation to changes to employer National Insurance." |
| Scottish Conservative finance spokesperson Craig Hoy said the committee had delivered a "damning assessment of the SNP's Budget preparations". |