Publication - Correspondence

Covid financial support: letter to the Treasury

Finance Secretary Kate Forbes has written to Chancellor Rishi Sunak urging further consequentials to deal with the sudden impact of the Omicron variant.

Published:
15 Dec 2021
Covid financial support: letter to the Treasury

Dear Rishi,

Covid Financial Support

I am writing to you following today’s COBR meeting and the confirmation of additional funding to support Devolved Administrations in addressing the continuing impact of Covid.

Whilst I recognise and appreciate the early confirmation of forthcoming consequentials, I consider it entirely inadequate given the scale of the challenge we face from Omicron. I am concerned that the current total of £220 million does not represent additional funding, as it essentially covers two items the Scottish Government had been previously notified of or represents anticipated funding related to pre-omicron levels of Covid. Specifically;

  • The £145 million of consequentials related to the previously announced £1.5 billion of discretionary funding to compensate for material change of circumstance for business rates;
  • Additional consequential funding in relation to £800m of additional funding for the Department of Health and Social Care (DHSC) for Test and Trace and Vaccination.

Indeed, not only is this funding quite clearly not additional, given £268 million of consequentials had been anticipated and largely budgeted for, the net effect of the announcement yesterday is to reduce our ability to fund public health measures not increase it.

More fundamentally, it is not a tenable position that funding is only triggered in relation to public health decisions in England. This directly inhibits our ability to protect jobs, lives and the NHS. We recognise that any system requires rigour and cannot be without controls but a system is required that supports the decisions of each devolved administration and is not beholden to the decisions of one part of the UK.

Across the UK and Scottish Government, we have already provided support to mitigate, as far as possible, the health and economic harms of Covid and we must continue to do this.

Without appropriate additional funding provided now, we will not be able to take decisions to protect public health and the wider economy at this critical juncture when we are trying to both slow the spread of the new variant and provide the financial support necessary to allow that.

I would also wish to seek assurance that any additional funding provided now and in the coming days is guaranteed in full and not subject to future deductions. You will understand, that without the ability to borrow, future year funding reductions could have a substantial damaging impact on our continuing COVID response and our ongoing ability to support public services in Scotland.

In my letter to the Chief Secretary to the Treasury on 10 December I requested an early and urgent conversation on this, and again request that such a meeting takes place as soon as possible.

Finally, I understand decisions are being made at pace, however it was disappointing that yesterday’s announcement as the First Minister was setting out the Scottish Government’s Omicron actions to Parliament, was provided without either advance notice or clarity on the amount to be provided.

Yours sincerely,

KATE FORBES

Letter to the Treasury

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