Managing Scotland’s Public Finances: A Strategic Approach

Closes 12 Aug 2024

Opened 10 Jun 2024



To inform this year’s pre-budget scrutiny, the Finance and Public Administration Committee will focus on three key areas:

  • progress on the Scottish Government’s public service reform programme
  • the Scottish Government’s approach to taxation - including what its draft tax strategy should include and how potential behavioural responses impact business and individuals
  • how the Scottish Government is using its capital expenditure to achieve innovation, productivity, and growth.

Primary objectives

The primary objectives of this year’s pre-budget scrutiny inquiry are:

  • to establish progress made in relation to the Scottish Government’s 10- year public service reform programme
  • to influence development of the Scottish Government’s tax strategy by seeking views on what key elements the strategy should include
  • to bring greater transparency to the potential impacts of behavioural change arising from the Scottish Government’s approach to taxation
  • to scrutinise the effectiveness of the actions that the Scottish Government is taking to grow the tax base and increase labour market participation, productivity, and growth, and what further actions are needed
  • to establish in what areas the Scottish Government should prioritise its limited capital spend to achieve most progress with innovation, productivity, and growth.

Sharing your views

To help inform its inquiry, the committee is asking 11 questions in its call for views.

Responses to any or all of the questions are welcome.

Where respondents recommend additional expenditure in any policy area they should also identify where this additional expenditure should come from.


Scottish Government priorities 

In May 2024, the First Minister set out his four priorities to guide the Scottish Government’s decision-making on policy and the budget.

He said his four priorities are: 

  • Eradicating child poverty
  • Growing the economy
  • Tackling the climate emergency
  • Delivering better public services.

1. Are these the right priorities for the Scottish Budget 2025-26 and, if not, where should the Scottish Government focus its attention?

2. What taxation and spending decisions should the Scottish Government take to make most progress against each of the First Minister’s four priorities, within the current financial climate?

3. What are the potential impacts of focussing budget decisions on these four priorities on those groups of society who traditionally experience inequality?

Public service reform

In December 2023, the Scottish Government said in the first three years of its ten-year reform programme it must have made progress in a range of areas, including:

  • agreeing a common vision and a clear set of goals for reform,
  • developing a programme of work across the public services system to support long-term reform,
  • ensuring strategic investment to sustain capacity for reform and disinvestment in areas that don’t align with its vision and objectives,
  • removing, wherever possible, any identified barriers to reform,
  • that reform actions are making progress against more qualitative indicators of change, improvement, and success.

4. What progress has the Scottish Government made against these specific goals in relation to public service reform?

5. Are there any improvements that can be made to achieve faster progress with public service reform and improved outcomes?

6. The Scottish Government recently published its Public Sector Pay Policy 2024-25 which offers pay metrics above forecast levels of inflation.

What are the implications of its multiyear framework on Public Sector bodies and on the Scottish Budget for 2025-2026? And for the subsequent two years?


The Scottish Government plans to publish a draft tax strategy alongside its Medium-Term Financial Strategy.

It established a Tax Advisory Group which first met in July 2023. Its purpose includes providing advice on:
“the development of a tax system that is fit for purpose, delivers sustainable public finances and supports high quality public services and a flourishing economy”, building on the Scottish Government’s Framework for Tax 2021

The Scottish Government said: 

“We want to build a tax system that works for everyone in Scotland, while allowing us to continue to deliver high-quality public services and keep our finances on a sustainable footing.”

7. What elements should a new draft tax strategy include to achieve such a tax system?

8. How should a new draft tax strategy address potential impacts of behavioural change on individuals, businesses, and the overall tax take?

9. What actions should the Scottish Government take to grow the tax base and increase labour market participation, productivity, and Scotland’s economic growth?

Climate emergency

The First Minister said that growing the economy will also be achieved through tackling the climate emergency by investing in green energy and infrastructure.

10. What steps should the Scottish Government take, in its Budget for 2025-26, to grow the economy in this way?

Capital expenditure

The Scottish Fiscal Commission has forecasted that Scotland’s capital budget is expected to fall by 20 per cent in real terms between 2023-24 and 2028-29.

11. Given the limited capital budget available, in which areas should the Scottish Government prioritise its capital spend in the Scottish Budget 2025-26 to deliver increased productivity, innovation, and growth?

How to submit your views

Please submit your views using the online submission form, linked to below.

We welcome written views in English, Gaelic, Scots or any other language. 

The committee is inviting views by the deadline of 12 August 2024.

What happens next? 

Once the call for views closes, the responses will be analysed, published and shared with the committee.

The committee will then consider, on the basis of the written evidence received, which witnesses to invite to appear before the committee in person to give oral evidence.

Evidence sessions are likely to take place during September and October 2024, with a report to be agreed and published in early November.


  • FPA