Holyrood ministers have been told by their own financial watchdog that pressures on the Scottish budget are of their own making.

First Minister John Swinney and Finance Secretary Shona Robison continue to accuse Westminster for shortchanging Scotland, forcing them to make severe cutbacks in public services.

However, the Scottish Fiscal Commission says that while UK Government policies contribute to the squeeze on the Holyrood budget, much of it is a result of the Scottish Government’s own decisions such as lax pay policy and freezing council tax.

Today it has confirmed a warning last year that the Government will face persistent challenges in balancing its budget. 

Ms Robison has announced “emergency controls” on departmental spending ahead of delivering a Fiscal Statement early next month. The winter fuel allowance is being means-tested and the abolition of peak rail fares has been reversed. Questions are now being asked about the survival of free prescriptions, tuition fees and concessionary bus travel.

In a paper written in advance of the UK Budget on 30 October, the Commission’s chair, Professor Graeme Roy, said:   “The past choices of the Scottish Government narrow its room for manoeuvre now and in the future.

“Previous pay settlements, the approach to social security payments, and the council tax freeze have all added to the in-year pressures that must be accommodated as it continues to negotiate pay with the public sector unions.

“With pay making up more than half of the Scottish Government’s day-to-day budget, we need more transparency and planning around pay awards at Budget time to avoid disruptive spending controls being introduced part way through the year.

“The 2025-26 Scottish Budget will be published later this year and will set out a more complete picture of the funding and spending position.

“The Scottish Government will need to make difficult decisions to balance the budget and ensure decisions now are sustainable in the future.”

Scottish Conservative shadow finance secretary Liz Smith said: “Despite their hollow protestations, it’s clear that the drastic cuts the SNP Government are continuing to impose are the product of their own decision-making and mismanagement of Scotland’s finances.

“Despite receiving record block grants from Westminster and imposing the highest tax rates in the UK, SNP waste and economic incompetence has created a huge black hole in Scotland’s finances.

“By agreeing public sector pay deals in excess of their own pay policy, the SNP have further reduced their wriggle room, which is why they are ditching universal winter fuel payments to pensioners and proposing a wide array of other devastating cuts.

“These are their choices – and SNP ministers must own them.”