Scotland's Finance Secretary, Jenny Gilruth, has stated that freezing the rates of devolved benefit payments is "off the table," despite projections indicating a significant rise in the welfare bill. This decision comes amid concerns that the recent UK Budget has resulted in a real-terms cut to the Scottish Government's funding.
Latest official projections show Scottish Government social security spending increasing from £6.7 billion last year to £7.4 billion this year and an anticipated £7.9 billion next year. When asked about measures to curb these increases, such as freezing benefit payment rates, Gilruth emphasized Scotland's commitment to establishing social security on a premise of "dignity and respect," a principle adopted in 2018.
"I think a freeze, at the current time, would be off the table," Gilruth confirmed, reaffirming the government's stance on not moving away from its current approach to social security. She also declined to comment on potential changes to income tax rates.
The UK Budget is expected to provide the Scottish Government with an additional £600 million through the Barnett Formula. However, the Scottish Government estimates this equates to a real-terms cut of £650 million for the 2027-28 financial year. Gilruth stated that the Budget "falls far short of the action which is required" and that cutting Scotland's budget demonstrates a lack of respect for devolution.
In parallel, Scottish families in council tax bands A-D will receive a £100 payment to help with energy bills, mirroring a UK Government initiative. Gilruth committed to this on a "like-for-like basis" and indicated discussions with Cosla, the Convention of Scottish Local Authorities, would take place.
Scottish Conservative leader Russell Findlay criticized the Budget as a "damp squib" that would not boost economic growth, stating that both Labour and the SNP are "addicted to spending more on benefits, rather than getting people back into work."
The UK Government, however, asserted that the recent spending review provided Scotland with its largest settlement in real terms since devolution, averaging £50.9 billion annually from 2026-27 to 2028-29, with an additional £600 million from the Budget measures.
Pensions Minister Torsten Bell suggested the additional £600 million should enable the Scottish Government to provide similar support to families in Scotland as offered south of the border, particularly for energy bills and high street support.
Other UK Budget allocations benefiting Scotland include £18 million for a UK advanced chip design academy led by Edinburgh University and £6 million to expand the Scottish Events Campus in Glasgow. Scottish Labour leader Michael Marra expressed a desire for the Scottish Government to capitalize on opportunities presented by the Budget's focus on defense and energy industries.