Autumn Budget Revision 2025 to 2026 guide: finance update
Background information provided to the Finance and Public Administration Committee (FPAC) to help with members' scrutiny of the Autumn Budget Revision (ABR) 2025 to 2026.
A. Guide to the Autumn Budget Revision
1. The budget process for 2025-26 commenced with the publication of the Scottish Budget and annual Budget Bill which provided details of the Scottish Government’s spending plans. These plans (as amended at Stages 2 and 3 of the Budget Bill) were approved by the Scottish Parliament on 25 February 2025 and received Royal Assent on 28 March 2025.
2. Once the Budget Act has been approved by the Scottish Parliament, there are usually two opportunities to amend the budget as the year progresses - the Autumn Budget Revision and a Spring Budget Revision. The Autumn Budget Revision provides the first opportunity to amend the budget figures.
3. The Autumn Budget Revision was finalised on 25th September 2025 ahead of the draft SSI being laid in Parliament on 25 October 2025. This guide was provided to the Finance and Public Administration Committee on 30 October 2025 ahead of the scheduled scrutiny session on 11 November 2025.
A.1 Summary of the Spring Budget Revision
4. The Autumn Budget Revision is routine parliamentary business that proposes amendments to better align the Government’s budget with its planned spending profile.
5. The changes proposed in the Autumn Budget Revision result in an increase in the approved budget of £1,398.1 million from £63,128.7 million to £64,526.8 million.
6. The changes to the Budget are broken down in to four main areas:
- A.2 - Funding changes to reflect deployment of available resources to portfolios (total net increase to the budget of £1,137.0 million);
- A.4 - Technical adjustments (net increase to the budget of £246.8 million);
- A.3 - Whitehall transfers and HM Treasury allocations to the Scottish Government (£14.4 million); and
- A.5 - The transfer of resources between Scottish Government portfolios.
7. The main changes included under each heading are categorised in table 1.2 in the Budget Revision document and summarised below.
| Summary of Changes by Type Scottish Government Portfolios | Resources other than Accruing Resources as shown in Budget Act £m | Funding Changes £m | Technical Changes £m | Net Whitehall transfers £m | Net Transfers within Scottish Block £m | Revised Budget £m |
|---|---|---|---|---|---|---|
| Health and Social Care | 21,729.5 | 697.1 | 0.0 | 0.0 | (667.8) | 21,758.8 |
| Finance and Local Government | 13,576.6 | 204.3 | 0.1 | 0.0 | 1,294.3 | 15,075.3 |
| Social Justice | 7,608.1 | 65.1 | 0.0 | 4.6 | (136.3) | 7,541.5 |
| Education and Skills | 4,311.9 | 48.5 | 26.9 | 0.2 | (421.1) | 3,966.4 |
| Justice and Home Affairs | 3,954.5 | 122.5 | 0.0 | 0.0 | (26.0) | 4,051.0 |
| Transport | 3,881.4 | (21.7) | 78.7 | 3.5 | (11.6) | 3,930.3 |
| Rural Affairs, Land Reform and Islands | 1,143.3 | (3.1) | (0.1) | 0.0 | (8.1) | 1,132.0 |
| Climate Action and Energy | 607.9 | (4.3) | 0.0 | 0.0 | (34.7) | 568.9 |
| Deputy First Minister, Economy and Gaelic | 1,318.3 | 38.0 | 0.0 | 6.0 | 24.8 | 1,387.2 |
| Constitution, External Affairs & Culture | 324.0 | 0.3 | 0.0 | 0.0 | (0.4) | 323.9 |
| Housing | 1,068.1 | (17.5) | 0.0 | 0.0 | (43.0) | 1,007.6 |
| Crown Office and Procurator Fiscal Service | 249.1 | 1.7 | 0.0 | 0.0 | 0.0 | 250.8 |
| Scottish Government | 59,772.7 | 1,130.8 | 105.7 | 14.4 | (29.9) | 60,993.7 |
| Scottish Housing Regulator | 5.8 | 0.0 | (0.2) | 0.0 | 0.0 | 5.6 |
| National Records of Scotland | 34.4 | 3.6 | 0.0 | 0.0 | 0.5 | 38.5 |
| Office of the Scottish Charity Regulator | 3.8 | 0.0 | 0.0 | 0.0 | 0.0 | 3.8 |
| Scottish Courts and Tribunals Service | 177.0 | 2.5 | 0.0 | 0.0 | 28.2 | 207.7 |
| Scottish Fiscal Commission | 2.8 | 0.0 | 0.0 | 0.0 | 0.0 | 2.8 |
| Revenue Scotland | 12.0 | 0.0 | 0.0 | 0.0 | 0.0 | 12.0 |
| Registers of Scotland | 5.0 | 0.6 | 0.0 | 0.0 | 0.0 | 5.6 |
| Environmental Standards Scotland | 3.8 | 0.0 | (0.6) | 0.0 | 0.0 | 3.2 |
| Food Standards Scotland | 23.1 | 0.0 | 0.0 | 0.0 | 0.3 | 23.3 |
| Consumer Scotland | 4.1 | (0.6) | 0.0 | 0.0 | 0.9 | 4.4 |
| Scottish Teachers’ and NHS Pension Schemes | 2,916.3 | 0.0 | 141.9 | 0.0 | 0.0 | 3,058.2 |
| Scottish Administration | 62,960.6 | 1,137.0 | 246.8 | 14.4 | 0.0 | 64,358.7 |
| Scottish Parliamentary Corporate Body | 153.1 | 0.0 | 0.0 | 0.0 | 0.0 | 153.1 |
| Audit Scotland | 15.0 | 0.0 | 0.0 | 0.0 | 0.0 | 15.0 |
| Total Scottish Budget | 63,128.7 | 1,137.0 | 246.8 | 14.4 | 0.0 | 64,526.8 |
A.2 Funding Changes
8. Funding changes provide additional budget spending power to portfolios and programmes, and also some reductions where funding has been returned to the centre for redeployment elsewhere. Table 1.2 provides the funding changes on a net basis by portfolio of £1,137.0 million, however the gross impact is shown below.
| Scottish Government Portfolios | Funding Additions | Funding Reductions | Net Funding Changes |
|---|---|---|---|
| Health and Social Care | 697.1 | 0.0 | 697.1 |
| Finance and Local Government | 204.3 | 0.0 | 204.3 |
| Social Justice | 65.1 | 0.0 | 65.1 |
| Education and Skills | 53.4 | (4.9) | 48.5 |
| Justice and Home Affairs | 127.5 | (5.0) | 122.5 |
| Transport | 31.3 | (53.0) | (21.7) |
| Rural Affairs, Land Reform and Islands | 2.4 | (5.5) | (3.1) |
| Climate Action and Energy | 4.0 | (8.4) | (4.3) |
| Deputy First Minister, Economy and Gaelic | 38.0 | 0.0 | 38.0 |
| Constitution, External Affairs and Culture | 0.3 | 0.0 | 0.3 |
| Housing | 0.5 | (18.0) | (17.5) |
| Crown Office and Procurator Fiscal Service | 1.7 | 0.0 | 1.7 |
| Scottish Government | 1,225.6 | (94.8) | 1,130.8 |
| Scottish Housing Regulator | 0.0 | 0.0 | 0.0 |
| National Records of Scotland | 3.6 | 0.0 | 3.6 |
| Office of the Scottish Charity Regulator | 0.0 | 0.0 | 0.0 |
| Scottish Courts and Tribunals Service | 2.5 | 0.0 | 2.5 |
| Scottish Fiscal Commission | 0.0 | 0.0 | 0.0 |
| Revenue Scotland | 0.0 | 0.0 | 0.0 |
| Registers of Scotland | 0.6 | 0.0 | 0.6 |
| Environmental Standards Scotland | 0.0 | 0.0 | 0.0 |
| Food Standards Scotland | 0.0 | 0.0 | 0.0 |
| Consumer Scotland | 0.0 | (0.6) | (0.6) |
| Scottish Teachers’ and NHS Pension Schemes | 0.0 | 0.0 | 0.0 |
| Total Scottish Administration | 1,232.3 | (95.3) | 1,137.0 |
| Scottish Parliament Corporate Body | 0.0 | 0.0 | 0.0 |
| Audit Scotland | 0.0 | 0.0 | 0.0 |
| Total Scottish Budget | 1,232.3 | (95.3) | 1,137.0 |
A.2.1 Gross Funding Changes
9. In October 2024, the UK Government announced changes to employer National Insurance Contributions (NICs), increasing the secondary Class 1 rate from 13.8% to 15% and reducing the threshold from £9,100 to £5,000. These changes have had a significant financial impact on Scotland’s public sector employers.
10. The Scottish Government estimates the total cost to devolved public services to be approximately £535 million, rising to £750 million when indirect employers delivering contracted services, such as GPs and social care providers, are included. The Scottish Government has consistently called on the UK Government to fully reimburse these costs, highlighting the disproportionate burden placed on devolved services and the third sector. The UK Government has since confirmed that only costs for directly employed public sector employees (so not including contracted services such as GPs) would be funded and the Barnett formula would apply, ignoring any disproportionate impact in Scotland. £339 million of consequentials of additional funding was confirmed at the UK Main Estimates.
11. The Autumn Budget Revision allocates the £339 million of Barnett consequentials received in respect of the eNIC increases. However, the allocation falls short of the total estimated cost, leaving a funding gap of over £400 million. The Scottish Government has committed to centrally funding 60% of anticipated eNIC pressures for directly employed staff (in line with the allocation received from UK Government), with the remainder shortfall to be managed within existing portfolio budgets.
12. A significant portion of the additional funding allocated in the revised budget is directed toward enhancing Health and Social Care services. Almost £700 million in additional funding is being invested, including over £620 million to address resource pressures and £77 million in additional capital have been allocated to this portfolio. This increase underscores the Government's commitment to improving service capacity and infrastructure in response to growing demand.
13. An additional £300 million is being deployed, on top of £100 million carried forward through the Scotland Reserve, to support increased health service pressures, driven by additional demand, inflation and increased eNICs costs not funded by consequentials.
14. Support has been provided for employer pension contributions within Health and Social Care, with an allocation of £134.7 million from consequentials received. £85.4 million has also been introduced to address potential pay pressures across the Health workforce, ensuring that staffing needs are met without compromising service quality.
15. The Finance and Local Government portfolio has funding additions totalling £204.3 million in the budget revision. Within this, £173.7 million is being provided to Local Government, of which £144 million relates to the allocation of eNICS consequentials. The remaining £29.7 million relates to funding for 2025-26 pay deals.
16. Funding of £15 million has been provided to aid with Corporate Transformation projects and £14.1 million is being provided to help alleviate corporate running costs pressures. The balance of additional funding has been provided to support eNICS pressures across the Finance and Local Government portfolio
17. The Justice and Home Affairs portfolio is increasing by £122.6 million. £72.7 million has been provided to Police and Fire Pensions to reflect latest forecast costs. This is a volatile demand led scheme with costs dependant on a number of factors including the number of retirals.
18. Funding of £31.4 million has been allocated to the Scottish Police Authority, £15.2 million of which relates to eNICs funding, £10 million to support Police Scotland with its reform and modernisation programme and £6.2 million for pay awards.
19. Additional funding has been provided to Legal Aid (£10.1 million) to cover latest demand led forecast costings, Scottish Prison Service (£6.9 million) and Scottish Fire and Rescue Service (£4.8 million) including amounts for eNICs.
20. The Social Justice portfolio is being increased by £65.1 million. The majority of this movement relates to Social Security Assistance, with £50.4 million being provided for the enhanced Pension Age Winter Heating Payments. This is an internal projection of costs and will be revised at the Spring Budget Revision following forecasts from the Scottish Fiscal Commission.
21. Funding of £11.3 million is provided to support Two Child Limit mitigation. The remaining funding changes relates primarily to the application of eNICs consequentials.
22. £53.4 million of additional funding is provided for the Education and Skills portfolio. £32.6 million has been provided to the Scottish Qualifications Authority, £30.2 million of which will support ongoing activities, with the remaining £2.4 million covering additional costs of SQA Appointees in 2025-26 following a successful tribunal to determine their employment status.
23. Scottish Funding Council have received additional funding of £10.1 million, £5.7 million of which relates to eNICS consequentials. Of the remaining £4.4 million, £3.2 million has been provided to support staffing pressures, £0.7 million to support backfill for the University of Dundee recovery team and £0.6 million for the independent review of the University of Dundee.
24. £3.5 million has been provided to Student Awards Agency Scotland to support staffing pressures, whilst Education Scotland have been provided £3 million to support operational needs. The remaining funding changes within the portfolio relates primarily to the application of eNICs consequentials.
25. The Transport portfolio has been allocated £24 million to support the elimination of Peak Rail fares, in accordance with the Programme for Government commitment to abolish Peak Rail Fares effective from 1st September 2025. A further £7.3 million of funding for eNICs consequentials is provided to the portfolio.
26. £25 million of Financial Transactions funding is being provided to the Scottish National Investment Bank within the Deputy First Minister, Economy and Gaelic portfolio. This amount had been carried forward within the Scotland Reserve to support investments which conclude beyond the financial year-end.
27. Within the same portfolio, Ferguson Marine have been provided with £8.3 million of additional resource funding to cover under recoveries, post-delivery and warranty works.
28. The Climate Action and Energy portfolio is receiving additional funding of £4 million which relates to the application of eNICs consequentials. The remaining increases in the Rural Affairs, Land Reform and Islands portfolio (£2.4 million) Housing (£0.5 million) and Constitution, External Affairs and Culture (£0.3 million) portfolios, as well as the Crown Office and Procurator Fiscal Service (£1.7 million) are also all for eNICs consequential allocations.
29. The Scottish Courts and Tribunals Service received an extra £2.5 million of resource funding to fund part-time sheriffs and increased eNICs.
30. The National Records of Scotland has been allocated an additional £3.6 million in funding, with the majority designated to support activities related to Census 2031.
31. Registers of Scotland have received £0.6 million to mitigate eNICs pressures.
A.2.2 Reductions to Portfolios
32. The Transport portfolio has delivered £53 million in capital savings, including £32 million from the re-profiling of the vessel procurement schedule, £12 million from a reduction in Caledonian Maritime Assets Limited's pension liability, and £9 million from the re-profiling of the ports and harbours works schedule.
33. A total of £18 million in capital savings has been identified within the Housing portfolio. The savings have been identified from demand-led schemes where uptake has been lower than forecast, allowing resources to be reallocated while maintaining support for core housing priorities and protecting Fuel Poverty schemes. The savings were distributed across five schemes, with reductions of £5 million from Home Energy Scotland Grants, £1 million from SME Loan and Cash Back, £2 million from the Public Sector Decarbonisation Fund, £6 million from the Social Housing Net Zero Fund, and £4 million from Scotland’s Heat Network Fund.
34. The Climate Action and Energy portfolio has provided £8.4 million of savings. £4.6 million of this reduction is as a result of additional loan interest received on Scottish Water loans due to sustained higher interest rates. The remaining savings relate to a reduction in staff costs budgets across Environmental Services. These savings were identified and reflect efforts to manage overall budget pressures whilst maintaining delivery of core environmental functions.
35. Forestry and Land Scotland within the Rural Affairs, Land Reform and Islands portfolio, delivered £5 million in capital savings by releasing Woodland Creation funding to support key priorities.
36. The Scottish Police Authority has contributed £5 million in capital savings within the Justice and Home Affairs portfolio to support wider government priorities. In March 2025, Ministers approved an additional £10 million in resource funding to advance Police Scotland’s reform and modernisation efforts, offsetting this by reducing the capital budget by £5 million for the 2025–26 financial year.
37. The Scottish Funding Council, under the Education and Skills portfolio, has achieved capital savings of £4.9 million. Funding initially allocated to the Dunfermline Learning Campus is no longer required, therefore this has been returned to the centre to support other Scottish Government capital projects.
38. Consumer Scotland have returned £0.6 million of capital funding which is not required to meet their capital budget requirement in 2025-26.
A.3 Whitehall Transfers
39. There are a number of specific Whitehall transfers and allocations from HM Treasury recognised in the Autumn Budget Revision. The net positive impact on the Scottish Budget is £14.4 million.
40. The largest Whitehall transfer is £5.2 million in capital allocated to Enterprise, Trade and Investment under the Deputy First Minister, Economy and Gaelic portfolio, designated for seed capital payments related to Green Freeports for the 2025-26 financial year.
41. The portfolio has also been provided with an additional £0.8 million of funding for the Digital Innovations Fund.
42. A further £3.2 million is being provided to the Social Justice portfolio for the Debt Advice Levy. This will be used to fund essential debt advice services provided by a range of organisations across Scotland. £1.4 million is also provided in relation to Ukrainian Thank you payments.
43. The Transport portfolio is receiving a Whitehall transfer of £3.5 million in relation to A75 Union Connectivity Funding.
44. The Education and Skills portfolio will receive £0.2 million of National Cyber Security Funding in respect of the CyberFirst Programme.
A.4 Technical Adjustments
45. The Autumn Budget Revision records net positive technical changes of £246.8 million.
46. There is an increase to the AME provision for future NHS and Teachers pension costs of £141.9 million. This arises from the refinements of forecast based on scheme pension benefit payments and member employer and employee contributions. There is no impact on the Scottish Government’s discretionary spend as a consequence of this revised forecast.
47. Transport Scotland have requested an additional £78.7 million of cash cover for the Scottish Rail Holdings NDPB to support leases costs for existing rolling stock assets. This relates to differences between the budgetary and cash requirements of the NDPB which are driven by IFRS16 accounting rules. Under IFRS 16 rules, only the interest and depreciation elements of the lease are recognised in the resource budget. As the lease itself was already accounted for, no additional budget cover was required. However, the cash payment still needs to be made to meet the lease obligations. Again, this has no impact on the Scottish Governments discretionary spending powers.
48. The Education and Skills portfolio also includes an adjustment that provides £2.8 million of cash cover to the Scottish Qualifications Authority. Additionally, there is a £24.1 million increase within the Student Loans budget lines, reflecting updated estimates for student loans capital and capitalised interest requirements.
| Scottish Government Portfolios | Whitehall | Other Technical | Net Funding Changes |
|---|---|---|---|
| Health and Social Care | 0.0 | 0.0 | 0.0 |
| Finance and Local Government | 0.0 | 0.1 | 0.1 |
| Social Justice | 4.6 | 0.0 | 4.6 |
| Education and Skills | 0.2 | 26.9 | 27.1 |
| Justice and Home Affairs | 0.0 | 0.0 | 0.0 |
| Transport | 3.5 | 78.7 | 82.2 |
| Rural Affairs, Land Reform and Islands | 0.0 | (0.1) | (0.1) |
| Climate Action and Energy | 0.0 | 0.0 | 0.0 |
| Deputy First Minister, Economy and Gaelic | 6.0 | 0.0 | 6.0 |
| Constitution, External Affairs & Culture | 0.0 | 0.0 | 0.0 |
| Housing | 0.0 | 0.0 | 0.0 |
| Crown Office and Procurator Fiscal | 0.0 | 0.0 | 0.0 |
| Scottish Government | 14.4 | 105.7 | 120.1 |
| Scottish Housing Regulator | 0.0 | (0.2) | (0.2) |
| National Records of Scotland | 0.0 | 0.0 | 0.0 |
| Office of the Scottish Charity Regulator | 0.0 | 0.0 | 0.0 |
| Scottish Courts and Tribunals Service | 0.0 | 0.0 | 0.0 |
| Scottish Fiscal Commission | 0.0 | 0.0 | 0.0 |
| Revenue Scotland | 0.0 | 0.0 | 0.0 |
| Registers of Scotland | 0.0 | 0.0 | 0.0 |
| Environmental Standards Scotland | 0.0 | (0.6) | (0.6) |
| Food Standards Scotland | 0.0 | 0.0 | 0.0 |
| Consumer Scotland | 0.0 | 0.0 | 0.0 |
| Scottish Teachers’ and NHS Pension Schemes | 0.0 | 141.9 | 141.9 |
| Total Scottish Administration | 14.4 | 246.8 | 261.1 |
| Scottish Parliament Corporate Body | 0.0 | 0.0 | 0.0 |
| Audit Scotland | 0.0 | 0.0 | 0.0 |
| Total Scottish Budget | 14.4 | 246.8 | 261.1 |
A.5 Internal Transfers
49. There are a number of internal transfers within the Scottish Block as part of the Autumn Budget Revision process. Transfers between and within portfolios balance each other out.
50. The significant internal budget transfers between portfolios include:
- transfer from Health and Social Care to Local Government within the Finance & Local Government portfolio to support the investment in the integration of Health & Social Care (£257.2 million);
- transfer from Learning in Education and Skills to Local Government within the Finance & Local Government portfolio to support the Teachers’ Pay Deal (£243.8 million);
- transfer from Health & Social Care to Local Government within the Finance & Local Government portfolio for Care at Home (£124 million);
- transfer from Health & Social Care to Local Government within the Finance & Local Government portfolio for the Mental Health Transition and Recovery Plan (£120 million);
- transfer from Housing to Local Government within the Finance & Local Government portfolio for Discretionary Housing Payments (£79.2 million)
- transfer from Health & Social Care to Local Government within the Finance & Local Government portfolio for the Carers Act (£60.5 million);
- transfer from Health & Social Care to Education and Skills portfolio to pay the teaching grant for Nursery and Midwifery students (£49.3 million);
- transfer from Education & Skills to Local Government within the Finance & Local Government portfolio to provide funding for the delivery of the Whole Family Wellbeing Fund (£38.1 million);
- transfer from Education & Skills to Local Government within the Finance & Local Government portfolio to support the Free School Meals programme (£37 million); and
- transfer from Social Justice to Local Government to provide the Scottish Welfare Fund (£35.5 million).