A turf war on post-Brexit spending between the Scottish government and Whitehall is brewing behind the scenes.
Kate Forbes, the Scottish Finance Secretary, has accused Rishi Sunak of cutting the Scottish government’s capital spending budget while increasing overall spending across the UK.
Reacting on Twitter to Sunak’s statement, Forbes said: “Behind the Chancellor’s headline 27 per cent increase in UK capital expenditure, Treasury documents show a cut to the Scottish Government’s capital budget by five per cent in cash terms.”
The complaint came against the background of an extra £2.4 billion of Barnett spending for Scotland in the Spending Review with £1.3 billion related directly to covid spending.
A UK Government source said it was correct to say that the Scottish Government budget for spending on things like building and infrastructure was being reduced.
The official said: “The reason for that is that UK government capital spending is increasing and Scotland will benefit from that through things like increased UK spending on defence and research and development in universities. It is not the case that Scotland only benefits from things the Scottish government does.”
Scottish Secretary Alister Jack also laid down a marker for a turf war with the Scottish government over the Shared Prosperity Fund which will replace EU structural funding after Brexit.
There is a row over how the funding will be controlled with the SNP accusing the UK government of a “power grab” from Holyrood Ministers.
Jack did nothing to dampen that when he emphasised working with local councils on the new funding, suggesting the Scottish government could be bypassed.
Jack said: “The UK Government pledged to bring funding decisions back from Brussels, and our plans for a new UK Shared Prosperity Fund will deliver on this promise. This will be delivered by the UK Government across the UK, working in partnership with local authorities and communities.”
The increased tension came as figures showed the Scotland Office being put on an apparent war footing with an increased budget next year to meet likely demands for a second independence referendum.
Detail of the Spending Review reveal that Scottish Secretary Alister Jack’s department is getting a budget hike from £10.6 million to £11.4 million in the next year.
The extra cash coincides with the outcome of next year’s Holyrood election which, if the SNP win a majority, will see renewed demands for a another referendum vote.
A Treasury official said the funding boost was to help ensure the Scotland Office can “unleash the potential of the Union”.
Jack made no reference to the cash in his comments and officials said it was an accounting correction to cover money previously spend on items like extra preparations for Brexit.
