Chancellor Reeves Announces Historic Budget for Scotland

Chancellor Rachel Reeves delivered the largest block grant in Scottish history, providing an additional £3.4 billion to the Scottish Government for the 2025/26 budget. While this funding is a significant boost, Scottish Finance Secretary Shona Robison cautioned about hidden costs, particularly an estimated £500 million increase in National Insurance contributions that could offset the benefits of the new funding. Reeves emphasized the need for effective use of this funding to enhance public services, following a £22 billion fiscal deficit inherited from the previous government. The budget also includes substantial tax increases and changes to minimum wage rates, which will affect public finances across the UK, including Scotland. Despite the financial relief, the Scottish Government's commitment to maintaining public service levels remains uncertain without further financial guarantees. Economists suggest that the situation requires ongoing investment to recover from years of austerity.