Autumn Budget Revision 2026-2027: supporting document

Introduction

1. This booklet provides information for the Parliament and others in support of the ‘Budget (Scotland) Act 2026 Amendment Regulations 2026’ – the Autumn Budget Revision. The Order is a Scottish Statutory Instrument laid before the Scottish Parliament by the Scottish Government in September 2026. The booklet itself has no statutory force – it is produced as an aid to understanding the Order.

2. The purpose of the Autumn Budget Revision is to amend the Budget (Scotland) Act 2026, which authorises the Scottish Government’s spending plans for the financial year 2026-27.

3. The main changes to the Scottish Government’s spending plans, as set out in the supporting document to the Budget Bill, are explained below:

i) Funding changes to reflect deployment of available resources to portfolios (total net increase to the budget of £708.9 million).

ii) Technical adjustments (net decrease to the budget of £11.8 million).

iii) Whitehall Transfers and HM Treasury allocations to the Scottish Government (an increase of £105.2 million).

iv) The transfer of resources between Scottish Government portfolios.

4. In total these changes will increase the Scottish Government budget by £802.4 million from £67,655.2 million to £68,457.6 million.

5. The purpose of the Autumn Budget Revision is to seek Parliamentary approval for these changes.

6. Following the Scottish Parliament Election on 7 May 2026 a portfolio reshuffle took place. The table on the following page shows the translation of the old portfolio structure as at budget setting into the new structure.

Funding Changes

7. Following the completion of the 2026-27 Budget Act, additional funding has become available. Analysis of all funding movements is set out in tables 1.7 c, d & e. This funding has come from a number of sources. These include:

• £632 million of additional Barnett consequentials, confirmed at the UK Main Estimates and Spending Review, are being applied through the Autumn Budget Revision. The largest element of this is £533 million arising from non-recurring UK Government funding provided to local authorities in England to address deficits within the Special Educational Needs and Disabilities (SEND) system
• £211 million of underspends including the year, as set out in the 2025-26 Provisional Outturn have been carried forward in the Scotland Reserve to be utilised in 2026-27. These amounts are in addition to the £150 million assumed carry forward that was included in the budget position and primarily relate to the year-end adjustments contingency.
• £81.3 million of Budget Cover and Machinery of Government transfers confirmed by the UK Government since the 2026-27 Scottish Budget, primarily at the UK Main Estimates exercise.

8. The largest element of funding deployed in the budget revision is being provided to the Health and Care portfolio, totalling £566.9 million, to support demand and inflationary pressures alongside reducing waiting times and increasing capacity within the wider healthcare system.

9. £6.9 million has been provided to support the implementation of the statutory gambling levy, a mandatory annual fee paid by licensed operators to fund the research, prevention and treatment of gambling harm. These amounts relate to ring-fenced income received in 2025-26 which has been carried forward into 2026-27 through the Scotland Reserve.

10. The Deputy First Minister, Finance and Local Government portfolio has received funding additions of £26 million.

11. £10 million has been provided to Local Government to support recovery efforts following the Glasgow fire. £1.5 million has been provided to the Scottish Child Abuse Inquiry to aid with ongoing pressures. Additional funding of £14.5 million has been provided to help alleviate corporate running cost pressures.

12. £84.6 million of additional funding has been provided to the Education, Culture and Gaelic portfolio. This includes £35.2 million for Qualifications Scotland’s operational costs, £9.5 million for the Scottish Children’s Reporter Administration and £5 million for Children’s Hearings Scotland to support operational costs. A further £6.6 million has been provided to Disclosure Scotland, £3.5 million to Student Awards Agency Scotland and £2 million to Education Scotland to address ongoing pressures. The Scottish Funding Council has also received £3.2 million. His Majesty’s Inspectorate of Education, the Scottish Social Services Council and the National Social Work Agency have each received £1 million of additional funding.

13. In addition, £7.5 million has been provided to the portfolio to support the Reducing Class Contact Time commitment, and £3.5 million has been provided to support the Learning Estate Investment Programme. £3 million has also been provided to Student Support and Tuition Fee Payments as a result of increased demand.

14. The Justice portfolio has received additional funding of £35 million. Scottish Police Authority have received £12 million to support ongoing transformation. Funding of £9.3 million has been provided to the portfolio for the Emergency Services Mobile Communications Programme. Scottish Fire and Rescue Service have received £5.3 million to support ongoing pressures, and Scottish Prison Service have received £2.6 million to help manage the prison population crisis. The portfolio has also received £3 million of funding to support the running costs of the Emma Caldwell Public Inquiry.

15. The Economy, Tourism and Transport portfolio has received £84.0 million of additional funding, £42.9 million of which has gone to Economy and Tourism. This includes £30.3 million to the Scottish National Investment Bank to cover investment losses, £6.2 million to Ferguson Marine for costs and £3 million for Cairngorms Wildfires support. Scottish Enterprise have also been provided the flexibility to drawdown £3 million of underspends from 2025-26 carried forward through the Scotland Reserve for investments which have crossed financial years.

16. £40 million of the funding has been provided to Transport Scotland of which Scottish Rail Holdings received £37.8 million to fund the rail fare freeze and support the ongoing provision of statutory ScotRail services. £1.1 million has been provided to Highlands and Islands Airports to restore island air services operating from Inverness while £1.1 million has also been provided to fund Lifeline Air Services from Wick to Aberdeen and Glasgow.

17. Transport Scotland has also returned capital funding of £85 million back to the centre. £50 million of this relates to funding for Ferries which will now be funded using CMAL’s reserves. £13 million is returned from Low Carbon Vehicles reflecting a rephasing of the heavy-duty vehicles decarbonisation project while £9 million is returned from Active Travel reflecting reduced requirements for the Bus Infrastructure Fund and the Active Travel Infrastructure Fund.

18. Further capital reductions of £8 million for investment plans for Network Rail and £5 million for Highlands and Islands Airport’s capital requirement are also reflected.

19. The Climate Action and Rural Affairs portfolio has funding reductions of £2.7 million. This reflects savings returned by Scottish Water as a result of higher interest rates than originally forecast, which have generated additional income.

20.Table A – Funding changes as outlined in Table 1.2 split by gross and net

Technical Adjustments

20. The Autumn Budget Revision records net negative technical changes of £11.8 million.

21. For every portfolio, a technical adjustment has been made to reflect changes in the accounting treatment of ring-fenced resource budgets, including depreciation and impairments. In line with the 2026-27 Consolidated Budgeting Guidance, these budgets have been reclassified from Non-Cash to Annually Managed Expenditure (AME). This change ensures that expenditure is budgeted and reported in accordance with the latest budgeting guidance. The reclassification has no impact on the overall level of funding available to the Scottish Government and is not visible at the portfolio level of the budget as the corresponding DEL and AME adjustments net off against one another as technical changes.

22. The Education, Culture and Gaelic portfolio has negative technical changes of £11.9 million. Student Awards Agency Scotland have adjusted their AME budget by £11 million as a result of updated interest calculations, alongside amendments to their opening AME budget. This has no impact on discretionary spending. The remaining £0.9 million adjustment relates to Disclosure Scotland returning AME budget back to the centre as it is no longer required.

23. The remaining technical changes relate to small adjustments to existing IFRS16 budgets.

Whitehall transfers

24. There are a number of specific Whitehall transfers and allocations from HM Treasury recognised at the Autumn Budget Revision. The net positive impact on the Scottish Budget overall is £105.2 million.

25. The Economy, Tourism and Transport portfolio has received additional funding of £68.6 million. Resource funding of £21.5 million, and capital funding of £16.5 million has been provided from the UK Government for the Investment Zone programme in Scotland. £21.4 million of capital funding has been provided in regards to Green Freeports. £6 million has been provided to Scottish Enterprise as a transfer from the Department for Business, Innovation, Science and Trade, forming the UK Government's contribution towards a £22 million grant award to Chemify. £3.2 million has been transferred from the UK Department for Transport as its contribution towards the A75 Springholm and Crocketford improvement project.

26. £36.7 million is being provided to the Health and Care portfolio. £24.0 million relates to capital funding provided to support the Scottish Infected Blood Support Scheme and provide interim compensation payments. An additional £0.2 million of resource funding has been provided to support the Scottish Infected Blood Support Scheme transitional administration costs.

27. £11.1 million of capital funding has been provided to support the clinical research ambitions set out in the 2024 Voluntary scheme for Branded medicines Pricing, Access and Growth (VPAG). £1 million of resource funding has also been provided to support improvements to Health Technology Assessment (HTA) processes. The remaining £0.4 million relates to the delivery of the Cardiometabolic Obesity Prevention Study.

Table B – Whitehall and Technical transfers by Portfolio, 2026-27

Internal Transfers

28. Internal transfers do not affect the Scottish Government’s budget as a whole and net to zero. Internal transfers move budget provision within or between portfolios, often to reflect changes in responsibility between portfolios, changes in payment mechanisms and virement intended to maximise the use of available resources. The significant portfolio transfers are as follows:

• transfer from Health and Care to Local Government within the Deputy First Minister, Finance & Local Government portfolio to support the Real Living Wage (£160.0 million);
• transfer from Social Justice and Housing to Local Government within the Deputy First Minister, Finance & Local Government portfolio for Discretionary Housing Payments (£86.7 million);
• transfer from Health & Social Care to Local Government within the Deputy First Minister, Finance & Local Government portfolio for the Carers Act (£60.5 million);
• transfer from Health & Social Care to the Education, Culture and Gaelic portfolio for the Nursing and Midwifery Grant (£50.3 million);
• transfer from Education, Culture and Gaelic to Local Government within the Deputy First Minister portfolio for Children’s Social Care Workers (£41.0 million)
• transfer from Transport Scotland to Local Government within the Deputy First Minister, Finance & Local Government portfolio to support delivery of Active Travel Infrastructure (£40.0 million);
• transfer from Education, Culture and Gaelic to Local Government within the Deputy First Minister, Finance & Local Government portfolio to provide funding for the delivery of the Whole Family Wellbeing Fund (£38.1 million).

Format of Supporting Document

29. The summary tables on pages 15 to 24 set out the changes sought in the Order at portfolio level, and the effect of the proposed changes on the overall cash authorisations. There is a clear read across from the numbers shown on the face of the Budget Act to those in these tables, and to the revised numbers shown in the Autumn Budget Revision Order itself. Tables 1.5 and 1.6 provide a reconciliation between budgets and the cash authorisations. Tables 1.7 (a) to (e) show the sources of funding that support the changes applied and the movement of available resources. Table 1.8 shows the voted Capital Spending and Net Investment for each portfolio following the ABR adjustments. It should be noted that for the remainder of the document, only spending that scores as capital in the Scottish Government’s or Direct Funded Bodies’ Annual Accounts is shown as capital.

30. The main body of the document then provides a more detailed analysis of the proposed changes on a portfolio by portfolio basis. For each portfolio and direct-funded body, it shows:

• a summary of the changes proposed for the portfolio;
• how the proposed revised portfolio budget is comprised in terms of operating and capital resources, divided into the main spending aggregates: Expenditure Limit, UK Funded AME (Annually Managed Expenditure) and Other spending to show TME (Total Managed Expenditure) in respect of the Scottish Budget;
• details of the proposed major changes; and
• details of the proposed revised budgets disaggregated to Level 3.

31. The Scottish Government’s spending proposals are in the main presented to Parliament in resource terms. But to meet the requirements of the “Public Finance and Accountability (Scotland) Act 2000”, Budget Bills and Revisions seek authority for the budgets of NDPBs in cash, and NDPB numbers in this supporting document are also given in cash terms. In order to allow comparison with NDPB budgets presented in other Scottish Government publications, the following table compares cash and budgets.

Table C – Revised NDPB Cash and Resource Budgets by Portfolio, 2026-27

Process for the Budget Revision

32. Following detailed consideration by the Subordinate Legislation and Finance Committees, the Scottish Parliament has an opportunity to vote on the Autumn Budget Revision Order subject to a recommendation by the Finance and Public Administration Committee.