Sarwar: ‘We’re not going to make the budget fall’

Finance Secretary Shona Robison is due to set out her tax and spending plans on Tuesday.

With the SNP short of a majority in Holyrood, John Swinney needs some opposition members to either back the budget or abstain.

Speaking to ITV Border, Mr Sarwar said: “We’re not going to make the budget fall.

“But the key point here is that whenever the budget has passed and whatever has passed, it’s actually for any new government that’s elected after May to set a direction or a different direction in our country.

“We’re going to keep every option on the table for what we choose to do after the election in May so we can have that new direction in Scotland.

“That’s fundamentally the game-changer.”

Labour won't oppose the Scottish Government's budget.

Leader @AnasSarwar tells @KieranPAndrews his party will 'reserve the right' to look at options to potentially change the financial plan if his party wins the Holyrood election in May. pic.twitter.com/ynrnlLg7T1

— Representing Border (@ITVBorderRB) January 8, 2026

Pressed on what he meant by keeping options open, Mr Sarwar added: “We will look at what comes in the budget, but we will reserve the right to look at whether emergency provisions are needed or an alternative budget, or an emergency budget is needed after the election in May to meet the aspirations and the needs of the people of Scotland.”

The comments immediately drew fire from opposition parties. Scottish Conservative leader Russell Findlay accused Labour of giving the SNP a “free pass” on a Budget it had not yet seen.

“Anas Sarwar’s astonishing decision to give a free pass to the SNP budget, which he hasn’t even seen, confirms how weak Labour are,” he said.

“John Swinney will be delighted.

“The Scottish Conservatives are the only party that can be trusted to stand up to the SNP and the other left-wing parties at Holyrood who all want to inflict high taxes on hard-working Scots in order to fund an out-of-control benefits bill.”

Ms Robison welcomed Labour’s vow not to block the budget, but said she hoped the party would vote for her tax and spending plans.

“I am keen to build a broad consensus across Parliament for our budget,” she said.

“I would hope that Anas Sarwar and all MSPs would be able to actively vote for the budget I bring to Parliament next week – which will deliver on the priorities of the people of Scotland, invest in our NHS and support people with the cost of living.”

Meanwhile, the respected Fraser of Allander Institute has warned that whoever forms the next government will inherit a budget it says is already fundamentally unsustainable.

In its Scotland’s Budget Report 2026–27, published on Friday, the think tank said ministers are facing an underlying deficit of around £1.5 billion, alongside a separate capital funding gap of more than £1bn that cannot be closed without cancelling or delaying major projects.

While recent UK Budget consequentials and improved forecasts have eased day-to-day pressures for 2026-27, the institute said the Scottish Government has increasingly relied on one-off funding sources, reserve drawdowns and borrowing to make its annual budgets add up.

On current plans, it said, a one-off boost in funding next year will be used to offset an underlying resource deficit of more than £500m, continuing what it described as a years-long pattern of plugging recurring spending gaps with temporary measures.

On capital spending, the Finance Secretary’s plans published in June assumed £8.1 billion of capital investment next year, but only around £7.1 billion is available even after borrowing is taken into account.

“The gap on the capital side is too large to fill, and will require significant prioritisation,” the report said, adding that the long-awaited Infrastructure Investment Plan must now spell out clearly which projects will go ahead – and which will not.

The think tank also challenged repeated claims by Scottish ministers that the Budget is “balanced”, arguing that borrowing and non-recurring revenues are routinely being counted as if they were permanent funding.

Dr João Sousa, Deputy Director of the Institute, said: “The Scottish Government’s job has been made easier on the resource side this year, mostly due to Barnett consequentials and some unexpected additional funding. But this boost masks the fact it will still be in underlying deficit, which means this approach cannot be relied on indefinitely.

“There is no such news on capital, and there something will have to give. We hope the long-awaited Infrastructure Investment Plan will explain to the public how projects have been prioritised – and crucially, which ones will no longer be going ahead and why.”

Professor Mairi Spowage, Director of the Institute, said: “Because so much of the funding for the Scottish Government over the long run comes from health consequentials, the UK Government bearing down on health spending growth would leave the Scottish Government short of good options to close its funding gap.

“The already large gap currently projected by Shona Robison by 2029-30 is clearly unsustainable, and makes the challenge even more daunting. The tax rises required to plug the gap seem undeliverable, largely due to Scotland having fewer very high earners, and it’s hard to see how the Scottish Government could respond without having to cut spending.”