Scottish services could be ‘short-changed’ by £400m – Swinney

Scottish services would be “short-changed” by £400 million if reports around compensation for the national insurance contributions (NIC) rise are correct, First Minister John Swinney has claimed.

Recent reports have suggested the Scottish Government could be given around £300 million to compensate for the impact of Chancellor Rachel Reeves’ NIC rise.

The UK Government says the Scottish Government will receive an extra £3.4 billion next year as a result of the Chancellor’s decisions as well as £1.5 billion in the current financial year.

Mr Swinney’s administration is due to publish its own Budget on December 4 but ministers in Edinburgh do not expect to have clarity on the NIC compensation issue by this time.

When the issue was raised at First Minister’s Questions on Thursday, Mr Swinney said: “If the figures that were reported this week are all that is provided, that will mean that the Chancellor of the Exchequer will be short-changing services the public depend upon by over £400 million.”

Mr Swinney said GPs and colleges would be caught up in the tax rise and that due to the UK’s public finances “independence can’t come soon enough”.

The Conservatives’ Craig Hoy said Mr Swinney had not “changed the record” on independence.

He said both governments are to blame for the impact of the NIC rise, saying the SNP has allowed the “public sector to become too big”.

The First Minister hit back by referring to the “economic incompetence” of the Conservatives and Liz Truss’s administration.

Labour’s Michael Marra said the Chancellor’s Budget had led to an “unprecedented” £5 billion uplift for the Scottish Government.

He said the Office for Budget Responsibility had pointed out that debts “rise and rise forever” if more money is not raised.

Mr Swinney called on Labour to engage with his government in the negotiations on the Scottish Budget.

Earlier, SNP Finance Secretary Shona Robison said the UK Budget would lead to taxes being around £2 billion higher, with £750 million of this falling on the public sector and other sectors providing services.

The Scottish Government had earlier said that the NIC cost to the public sector would be around £500 million.