Next week, Shona Robison, the Scottish Finance Minister, will deliver her 2024–25 Budget in one of the most financially challenging environments the Scottish Government has faced since devolution. Earlier this year, the Scottish Government’s Medium-Term Financial Strategy (MTFS) projected a gap between funding and what would be needed to maintain services of £1 billion in the coming year – and argued that there was a need to consider whether targeting help rather than universal provision ‘may offer greater value for money and an improved offer to those most in need’. And while better-than-expected tax revenue collections, a revised Fiscal Framework and additional funding from the UK government have boosted the funding the Scottish Government is set to receive next year, larger-than-planned increases in public sector pay and still-elevated inflation mean the funding gap next year is likely to be even larger than projected in the MTFS. Moreover, financial pressures are only set to intensify in the second half of the 2020s and beyond.
One area where Scotland’s public service provision has long appeared more generous than that in England and Wales is higher education, with students who choose to stay in Scotland for university not required to pay any tuition fees. Instead, the costs of their teaching are all met by the Scottish Government, at a cost of around £900 million in 2022–23. In addition, Scotland still provides the poorest students with non-repayable bursaries of up to £2,000 per year towards their living costs, alongside loans.
Preserving this model will be increasingly difficult given the financial pressures facing the Scottish Government as well as Scottish universities and students.
