Shona Robison has said the Scottish Government has been forced to take “exceptionally difficult decisions" to find £680m in savings in the current financial year.

The deputy first minister and finance secretary blamed inflation, higher than expected public sector pay deals and inadequate funding from Westminster for the situation.

She said she faced more “challenges” setting the budget for 2024/25 next month, including a projected £1bn shortfall in resource spending and a real terms cut in capital spending.

Addressing MSPs, she urged Chancellor Jeremy Hunt to use his autumn statement at Westminster tomorrow to “step up” and use his powers “for the benefit of Scotland”.

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She said: “Bluntly, when Westminster consistently under-invests in public services it means we have less funding to spend on our public services in Scotland.”

She said he should use any fiscal headroom, or leeway in the public finances, to invest in services and help struggling families rather than make pre-election tax cuts. 

The Scottish Tories accused Ms Robision of resorting “to the SNP’s usual tactic of blaming everything on Westminster”. 

Ms Robison said that her budget for next year would be based on figures in the autumn statement, which the UK Government had yet to share with the Scottish Government.

“The disappointing reality is that the amount Scotland has to spend on services is still largely driven by a Westminster wedded to even deeper austerity,” she said.

“Our public finances have continued to face significant challenges from inflation, Brexit, the war in Ukraine, the increased costs of public sector pay, and a capital budget that does not come close to what is required.

“This year, we have prioritised public services and delivered fair pay deals for our public sector workers. But these come at a cost, and we must deliver a balanced budget. 

“Pay deals added an estimated £1.26bn to our recurring pay costs in 2023/24, and £1.75bn across the public sector. This was around £800m above the amount budgeted for 2023/24.

“We have worked to try and mitigate the impact of Westminster austerity. 

“But without a change in course from Westminster I fear we are now at the limits of what it is possible to mitigate within the powers of devolution.

"These have been exceptionally difficult decisions, but they have been necessary to protect services where they are needed the most."

She said cuts and reprioritised funding of £680m were required in the current year,  equivalent to just over 1% of Holyrood's budget for 2023/24. 

Of this, £391m will be found from day-to-day spending and £289m from capital spending.

The reductions include £30m from energy capital programmes, £28m from agriculture and £102m from body which funds colleges and universities.

However the Scottish Child Payment and other benefits are protected.

She said she had asked Mr Hunt to avert a projected 6.7% real terms fall in Holyrood’s capital budget for large building projects between 2023 and 2028.

“I have called on the Chancellor to increase working-age benefits by inflation to ensure that they retain their real-terms value for struggling families across the UK,” she said.

“And I have again called upon the UK Government to remove the heinous rape clause - the two-child cap - and the benefit cap, which disproportionally affect women and children.”

She ended: “I have been frank with members about the challenges we face and difficult decisions we have had to take to balance our budget and make best use of public money. 

“We are doing all that we can with the limited powers that we have, but we need the UK Government to step up and use its powers for the benefit of Scotland. 

“The priority for any fiscal headroom should be investment in public services.

“Tomorrow the Chancellor has the opportunity to make a real difference for people across Scotland and I urge him to take it.”

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Tory finance spokeswoman Liz Smith said: “Shona Robison has reverted to the SNP’s usual tactic of blaming everything on Westminster – though she told the Finance committee this morning that Scotland’s two governments were working well together.

“She needs to take responsibility for the £1bn black hole in Scotland’s finances, our faltering growth and the huge cuts that she is proposing today for health, education, transport, energy and, as usual, our forgotten rural economy.

“Scotland desperately needs a government with a strategic plan for growth, to protect future public service spending and fund pay settlements announced by SNP ministers.

"Yet there is still little sign that the SNP has taken any of this on board.”