SNP and UK ministers have agreed an independent report will investigate any changes needed to the block grant ahead of a review into Scotland’s devolved financial deal.
Following talks between SNP Finance and Economy Secretary, Kate Forbes and Chief Secretary to the Treasury, Simon Clarke, both administrations have agreed in principle the scope of a key independent document that will inform the review of the Scottish Government’s fiscal framework.
The review itself is expected to begin early in 2022.
In 2016, the fiscal framework set out fiscal powers that would complement the devolution of tax and welfare powers – including how the block grant from Westminster was adjusted and arrangements for capital borrowing.
Prior to the in-person meeting, Ms Forbes warned that “Scotland’s fiscal framework has been thoroughly tested and, in some areas, found wanting” during the pandemic and the impacts of Brexit.
Both parties have now agreed to commission an independent report on the block grant adjustment arrangements, including a call for stakeholders to contribute, prior to a broader review of the fiscal framework.
Mr Clarke said: “After our first in-person meeting it’s great that we’ve been able to get an agreement and can now get on with the fiscal framework review and ensure fair and sustainable funding for Scotland’s future.
“We’re continuing to work together to tackle the big issues we face as a United Kingdom, including climate change, levelling up opportunities and supporting jobs.”
Ms Forbes said: “Today’s meeting was positive and I am glad that we are finally making some progress on the fiscal framework.
“I have reached an agreement in principle with the Chief Secretary to the Treasury which enables us to move without further delay towards commissioning the independent report, with the fiscal framework review itself beginning as close to the beginning of 2022 as possible.
“While the report will look only at the block grant adjustments, we agreed that the review should have a wider scope and involve input from parliamentary committees and wider stakeholders.”