³ÉÈË¿ìÊÖ

About the inquiry

The committee is carrying out a short, focussed inquiry on how the Scottish budget process has worked in practice, during the current parliamentary session (2021-26).

It aims to identify any improvements that can be made to the budget process, ahead of the next five-year session of Parliament.

Inquiry focus

The focus of the inquiry will be on the four core objectives that underpin the Scottish budget process:

• to have greater influence on the formulation of the Scottish Government’s budget proposals
• to improve transparency and raise public understanding and awareness of the budget
• to respond effectively to new fiscal and wider policy challenges
• to lead to better outputs and outcomes as measured against benchmarks and stated objectives.

The current budget process

To achieve these four core objectives, the Parliament currently takes the following approach:

• a full year approach, where committees have flexibility to incorporate budget scrutiny into their work prior to firm and detailed spending proposals being published
• a continuous scrutiny cycle, with an emphasis on developing an understanding of the impact of budgetary decisions and trends over time
• output/outcome focused scrutiny, including evaluating what budgets have achieved and aim to achieve over the long-term
• fiscal responsibility, where scrutiny has a long-term outlook, includes prioritisation, and addresses fiscal constraints and the impact of increasing demand for public services
• a focus on the interdependent nature of many of the policies which the budget is seeking to deliver.

Key documents, timings and actions

An agreement between the Scottish Government and the Finance and Public Administration Committee sets out the key documents, timings and expected actions during the budget process.

These include:

• a Medium-Term Financial Strategy (MTFS) is usually published in May, setting out the Scottish Government’s expectations and broad financial plans / projections for at least the next five years
• the Scottish Government publishes an annual fiscal framework outturn report, usually in September, to support parliamentary scrutiny of the operation of the fiscal framework
• a publication timeframe for committee pre-budget reports or letters
• a presumption that the Scottish Government will carry out a spending review, linked to the equivalent UK spending review, and that a framework document setting out context will be published, criteria to govern the assessment of budgets and the process and timetable for the spending review
• expectations around the timescales for publication of the Scottish Budget and MTFS, and details of each Stage of the Budget Bill.

Information, guidance and support

³ÉÈË¿ìÊÖ, parliamentary committees and officials currently receive the following information, guidance and support on the budget process:

• annual guidance for committees, including possible approaches to scrutiny
• SPICe briefings and blogs on the Scottish Budget, including common themes arising from committees’ pre-budget scrutiny
• Scottish Fiscal Commission (SFC) briefings for ³ÉÈË¿ìÊÖ and officials on the SFC’s Economic and Fiscal Forecasts and Fiscal Sustainability Reports
• support to committee clerking teams when considering possible budget scrutiny approaches
• an expert budget adviser to provide technical expertise to the Finance and Public Administration Committee on its budget scrutiny.