Scottish Public Finance Manual

The Scottish Public Finance Manual (SPFM) is issued by the Scottish Ministers to provide guidance on the proper handling and reporting of public funds.

Expenditure without parliamentary authority


1. This section gives guidance on the procedures for undertaking expenditure without the authority of the Parliament, which is usually provided by inclusion in an approved Budget Act relating to that financial year.

2. The guidance is aimed primarily at the core Scottish Government (SG) and the other constituent parts of the Scottish Administration (i.e. the Crown Office and Procurator Fiscal Service, SG Executive Agencies and non-ministerial departments). Other organisations funded direct from the Scottish Consolidated Fund (SCF) should also note the need for both statutory powers and parliamentary authority in order to undertake expenditure.

Key points

3. To be able to undertake expenditure all of the following are normally required:

All three elements should be satisfied before commitments or expenditure are authorised.

4. Parliamentary approval for expenditure is given through inclusion in the annual Budget Act. Without such authority, expenditure cannot normally take place.

5. If no such authority exists, approval can be sought from the Cabinet Secretary for Finance, Economy and Fair Work to use contingency powers provided that Ministers have the statutory power to undertake the underlying activity.

6. Consideration must first be given, in consultation with the SG Directorate for Financial Management, to the possibility of seeking an urgent Budget Amendment Order.

7. The use of contingency powers must be reported to the Parliament immediately that Ministerial approval is given and, if possible, no related payments should be made until 14 days have elapsed from the date of the report.

Statutory background

8. Expenditure of the SG is paid out of the Scottish Consolidated Fund (SCF). Section 65 of the Scotland Act provides that a sum may only be paid out of the SCF if:

  • it has been charged on the SCF by any enactment

  • it is payable out of the SCF without further approval by virtue of the Scotland Act; or

  • it is paid out in order to meet expenditure of the Scottish Administration, or to meet expenditure payable out of the SCF under any enactment but only in accordance with rules set out, in practice in the Public Finance and Accountability (Scotland) Act 2000

9. Section 65 also states that sums paid out of the SCF shall not be applied for any purpose other than that for which they were paid out.

10. Section 1 of the Public Finance and Accountability (Scotland) Act 2000 provides that expenditure by the Scottish Administration and other bodies funded directly from the SCF must be authorised on an annual basis by Budget Act. The Budget Act to specify the purpose for which resources may be used and the maximum amount of related expenditure in the particular financial year to which the Budget Act relates. 

11. Those parts of the Act specifying Budget approvals and the purposes for which resources may be used can be amended, by Order subject to affirmative resolution.

12. Section 3 of the Public Finance and Accountability (Scotland) Act 2000 sets out contingency arrangements to allow for the use of resources in certain circumstances where the use of resources has not been authorised by Budget Act. Parallel provisions on cash expenditure are made in the relevant Budget Act. This is intended to cover instances where there is an urgent need, but no time to seek parliamentary approval. All use of the power must be reported to the Parliament and the procedure should only be used exceptionally when it is not practical to seek a Budget revision.

13. In addition a Written Agreement between the Parliament and the SG covering in year changes to expenditure allocations sets out the arrangements for the use of contingency payments.


14. Where there is no Budget Act authority Scottish Ministers may, in any financial year, authorise the use of resources up to 0.5% of the aggregate amount authorised by Budget Act at the beginning of the financial year and cash expenditure up to an aggregate amount set out in the Budget Act if they consider that:

  • the expenditure is necessary in the public interest; and

  • it is not reasonably practicable, for reasons of urgency, for Budget Act authority to be secured in advance of expenditure being undertaken

15. Before any action can be taken formal approval must be sought via the SG Directorate for Financial Management from Scottish Ministers, including the Cabinet Secretary for Finance, Economy and Fair Work, to use contingency powers. Unless the circumstances are such that extreme urgency makes it impossible, the Scottish Ministers must lay a report before the Parliament at least 14 calendar days before undertaking any related expenditure.

16. The report to the Parliament should say what circumstances have required Ministers to authorise the exceptional use of contingency powers and why expenditure cannot wait for the next budget revision. Details of any contingency payments made by the SG should appear in the SG's annual accounts.

Page updated: May 2019


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