Furlough extension among Scottish Government budget asks

Kate Forbes calls on UK Chancellor Rishi Sunak to support Scotland as lockdown measures start to ease in the coming weeks.

Furlough extension among Scottish Government budget asks Getty ImagesGetty Images

Extending the £20 Universal Credit uplift and the furlough scheme are among the Scottish Government’s asks ahead of this week’s UK Budget.

In a letter to Chancellor Rishi Sunak, Scotland’s Finance Secretary Kate Forbes has urged the UK Government to support Scotland as lockdown measures are set to be eased over the next six weeks.

As a result of the pandemic, the UK Government increased the weekly payment of its flagship benefit by £20.

Forbes said Joseph Rowntree Foundation research said ending the uplift would lead to 500,000 being pushed into poverty.

She said: “I therefore reiterate my call for the UK Government to do the right thing and make the uplift permanent and extend it to legacy benefits in order to provide meaningful and effective long-term support as the effects of the pandemic continue to be felt.”

With the furlough scheme due to end in April, three months before the Scottish and UK Governments have said they hope to have the entirety of the adult population vaccinated and two months ahead of the earliest point where restrictions in England can be ended, Forbes again urged its extension.

“It is clear that the scheme needs to be extended beyond the present end date of April 2021,” she wrote.

“Whilst the rollout of vaccines provides hope that we will soon be able to return to normal, there remains a high level of uncertainty over how quickly public health restrictions can be lifted.

“It is clear that furlough remains the appropriate support for businesses that are not able to fully open, and it is essential that the UK Government commits to it remaining available to businesses in Scotland as long as restrictions remain in place.”

The Scottish Government is currently in the process of passing its budget, having to announce its draft plans before the UK Budget was announced after a delay for the second year in a row.

Forbes said the levelling-up fund had left a £400m hole in the Scottish Government’s coffers after the UK Government decided the fund should be administered across the entirety of the UK by Westminster in a similar way to the shared prosperity fund, news Forbes said her officials learned about through a news release.

She said: “I have built my budget around reasonable expectations that UK Government expenditure in devolved areas in England would generate Barnett consequentials, and so I would be grateful for assurances that this £400 million gap in the Scottish budget will be filled.

“Scottish Government funding should not be cut to pay for UK Government policies that are designed to undermine the devolution settlement.”

A spokeswoman for the Treasury said: “The UK Government has protected nearly a million jobs and thousands of businesses in Scotland since the start of the pandemic.

“And just last week the Treasury provided the Scottish Government with an additional £1.1bn, enabling them to support people, businesses and public services affected by coronavirus.

“At the Budget the Chancellor will set out the next stage of our plan to protect and create jobs in all corners of the UK.”

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