1. This assessment is based on the expenditure data presented in the 2017-18 Draft Budget and fulfils the statutory requirement under Section 94 of the Climate Change (Scotland) Act 2009 to report upon the emissions impact of expenditure proposals.
1.1. Scope of Assessment
2. The assessment of the Draft Budget captures solely the emissions associated with Scottish Government's purchase of goods and services. It is a consumption-based measure that covers direct emissions (including emissions from space heaters in Government buildings) and indirect emissions (supply side impacts, such as the production of gravel for roads constructed by the Government or generation of electricity, which is then used by Government). It also includes any imported emissions that are generated in producing the direct and indirect goods and services that Government purchases.
3. The methodology for the Carbon Assessment of the Draft Budget is high level in nature, and thus best applied to portfolio spending and budget expenditure as a whole. This assessment allows the Scottish Government to place the carbon impact of its use of good and services within the wider context of the national and global economy. It helps raise awareness of the carbon impact of spend in different areas, by identifying direct emissions and those from supply-side inputs.
4. The assessment does not, however, take account of 'second-round' emissions; while we do include emission impacts associated with Government spend and its supply chain, we do not count the emissions or savings associated with all of the outcomes arising from Government spending. For example, while the emissions associated with manufacturing and installing insulation are included, we do not count the carbon that may be saved in future as a result of making that improvement to the housing stock  .
5. In order to better understand the complete picture on emissions associated with Government spend on goods and services, this assessment needs to be read alongside the analysis contained in the Second Report on Proposals and Policies  , which sets out measures, out to 2027, for meeting the 2050, interim and annual targets in the Climate Change (Scotland) Act. Government will publish Scotland's Climate Change Plan in January 2017, setting out measures for achieving emissions reductions required to meet our 2050, interim and annual targets, covering the period to 2032.
6. The Environmental Input-Output model and methodology underpinning the Carbon Assessment of the Draft Budget remain the same as for the Carbon Assessment of the 2016-17 Draft Budget but use the latest available Greenhouse Gas emissions ratios and HM Treasury deflators.
1.2. Key Results
7. Following the approach set out in section 1.1, it is estimated that total emissions attributed to the Draft 2017-18 Budget amount to 8.8 million tonnes (Mt) CO2-equivalent. Applying the updated GHG emissions ratios and HMT deflators to the 2016-17 Draft Budget also shows an emissions total of 8.8 MtCO2-equivalent.
8. Emissions remain flat relative to the 2016-17 Draft Budget, while spending has risen, as expected higher Agriculture related income from the EU has resulted in less direct funding for Agriculture from the Scottish Government Draft Budget, effectively moving Scottish Government spend to less greenhouse gas-intensive areas.
9. Details on the various sources of emissions show that some 36 per cent of the Scottish Government's carbon footprint is caused by the use of energy, water and waste, followed by manufacturing (22 per cent) and transport and communication (15 per cent).
1.3. Budget Context
10. The Draft Budget for 2017-18 contains details of Total Managed Expenditure ( TME) of £38 billion across portfolio areas. Expenditure is split between resources and capital expenditure within the Departmental Expenditure Limit ( DEL) and Annually Managed Expenditure ( AME). This is illustrated in Table 1. Total Managed Expenditure was £37.1 billion across portfolio areas in the 2016-17 Draft Budget.
Table 1: Total proposed spending plans for 2017-18
|2017-18 Draft Budget|| DEL Resource
| DEL Capital
|Health and Sport||12,717.8||408.1||13,125.9||100.0||13,225.9|
|Finance and the Constitution||172.5||2.0||174.5||3,406.4||3,580.9|
|Education and Skills||2,674.5||171.4||2,845.9||443.0||3,288.9|
|Economy, Jobs and Fair Work||246.9||137.7||384.6||-||384.6|
|Communities, Social Security and Equalities||6,991.4||1,485.1||8,476.5||2,605.8||11,082.3|
|Environment, Climate Change and Land Reform||164.2||142.8||307.0||-||307.0|
|Rural Economy and Connectivity||1,458.8||1,407.8||2,866.6||-||2,866.6|
|Culture, Tourism and External Affairs||292.8||32.0||324.8||-||324.8|
|Crown Office and Procurator Fiscal Service||107.5||3.6||111.1||-||111.1|
|Scottish Parliament and Audit Scotland||102.0||1.2||103.2||-||103.2|
It is estimated that total emissions resulting from the 2017-18 Draft Budget will be 8.8 Mt CO 2-equivalent.
This assessment indicates that the amount of carbon for each pound of expenditure across the different areas of Government spending does not vary greatly.
'Second-round' emissions that may result from Government spending and the use of public goods and services, whether beneficial in terms of reducing emissions ( e.g. spending on energy efficiency or afforestation) or negative in terms of increasing emissions ( e.g. road use) are not captured.
Alongside this analysis of the carbon impact of the Draft Budget, the Scottish Government will continue to use additional assessment methods to improve understanding of the emission impacts of both Government expenditure and policies.
An assessment of the impacts of the Government's emission abatement measures can be found in the Second Report on Proposals and Policies. The Government's Climate Change Plan (setting out measures out to 2032 for achieving our climate change targets) will be published in January 2017.
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