FINANCE Secretary Kate Forbes has warned that SNP ministers are “still awaiting the finalised” funding settlement from the UK Government despite the next financial year starting in just six weeks’ time.

The Scottish and UK governments are caught up in another funding row after Ms Forbes claimed that clarity over the Chancellor's funding announcement last week to mitigate rising energy costs has resulted in Westminster “decreasing the funding” to be handed to the Scottish Government for next year's Budget.

Speaking in Holyrood, Ms Forbes said her Government is “still awaiting the finalised position from the UK Government”.

She said that before Christmas, she was told £440 million of UK Government funding to be received was cash “we might have to pay back as there would be no further consequentials”.

READ MORE: Kate Forbes announces £150 council tax discount for 1.8m Scottish homes

She added: “In mid-January, the message changed positively - the £440 million was secure and there would be further consequential funding.”

Ms Forbes said that to give “as much transparency as possible”, she announced an extra £120 million for local government based on “figures as we understood them”.

She warned that Rishi Sunak’s announcement last week “has changed the position again”, adding that the move has led to a decrease in funding, meaning “the spring Budget revision will need to be updated at the first available opportunity”.

Ms Forbes insisted that "frustratingly...with about six weeks to go until the end of the financial year, the position is yet to be formally and finally confirmed".

She said: “It matters because this is real money – it affects the funding available for local services, for taxpayers and for our recovery.

“And ultimately it matters because it demonstrates the extreme constraints of the devolution settlement within which we operate.”

The Finance Secretary said that “due to the arbitrary and strict limits on carry forward”, which sets out what can be brought forward to the next financial year, “if consequentials are to be used meaningfully this year, then I must give certainty now”.

READ MORE: Forbes warns over 'revised budget' amid claim £290m UK funding not new

She said: “ The changes to date, in a very short space of time, are significant. They will impact our assumptions on next year’s Scottish Budget and I will update Parliament once we receive the final position, at the UK supplementary estimate outcome later this month.”

Yesterday, the UK Government disputed claims by Ms Forbes that the £290 million of funding announced by the Chancellor was not new.

A spokesperson said: “The Scottish Government will receive £296 million of Barnett consequentials as a result of the council tax rebate announced by the Chancellor.

“This is new funding for the Scottish Government.

“People in Scotland expect both Governments to be working together for them, their families and communities so we will continue engage with them on this support.”

The Treasury said it regularly shared updates on Barnett funding with devolved administrations and final allocations are confirmed in February.