DEREK Mackay has urged the Treasury to increase the Scottish Government’s borrowing limits to help it cope with the “significant challenges” of an unusually late UK budget.

The Finance Secretary last night wrote to the Chief Secretary to the Treasury Rishi Sunak asking him to show greater flexibility in 2020-21.

Chancellor Sajid Javid last week announced the UK budget would be three months late on March 11 because of Brexit and the general election.

The date upset the Scottish budget, which is based on forecasts released with the UK budget.

Scottish ministers normally have these by December, allowing MSPs to pass a Budget Bill in February, which in turn lets Scottish councils set their budgets by in March.

In his letter, Mr Mackay said he had been left facing “a choice between two highly undesirable outcomes”, publishing the Scottish budget without all the facts available or attempting to do it in “an extraordinarily short time” after the UK budget.

Hinting he would set a Scottish budget before the UK one, he asked for a “flexible approach” on block grant adjustments related to Holyrood taxes and “revised borrowing limits and terms”.

He also asked for more time to fix previous forecast errors and confidential “early insight” into UK policy changes.