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The Scottish Government is progressing the Public Sector Reform Programme to ensure public services are sustainable, efficient and effective. Our work in this area is expected to save up to £280 million over a two year period by the end of 2024-25.

We have already streamlined the public sector landscape by reducing the number of Scottish public bodies under our control from 199 in 2007 to 131 as at 1 December 2024.

Accountable Officers for all public bodies have a personal responsibility for the propriety and regularity of the finances under their stewardship and for the economic, efficient and effective use of all related resources. This includes being personally answerable to Parliament for the exercise of their functions. This is set out in the Public Finance and Accountability (Scotland) Act 2000 and the Scottish Public Finance Manual.

The national public bodies directory contains a full list of non-departmental public bodies (NDPBs) and shows their creation date. The national directory can be viewed at: https://www.gov.scot/publications/national-public-bodies-directory/pages/executive-non-departmental-public-bodies/.

Since 2007, the following public bodies have been established as NDPBs:

Care Inspectorate

Children’s Hearing Scotland

Community Justice Scotland

Creative Scotland

Ferguson Marine

First-tier Tribunal for Scotland

Historic Environment Scotland

Independent Living Fund Scotland

Judicial Appointments Board

National Smart Ticketing Advisory Board

Poverty and Inequality Commission

Redress Scotland

Scottish Canals

Scottish Commission on Social Security

Scottish Fuel Poverty Advisory Panel

Scottish Futures Trust

Scottish Land Commission

Scottish Legal Complaints Commission

Scottish National Investment Bank

Scottish Rail Holdings Ltd

Skills Development Scotland

South of Scotland Enterprise

Upper Tribunal for Scotland

Zero Waste Scotland

Since 2007, the following public bodies no longer operate as NDPBs, due to merger, abolishment, or reclassification:

Additional Support Needs Tribunals for Scotland

Advisory Committee on Sites of Special Scientific Interest

Building Standards Advisory Committee

Children’s Panel (x32)

Deer Commission for Scotland

Fisheries (Electricity) Committee

General Teaching Council for Scotland

Historic Environment Advisory Council for Scotland

Lands Tribunal for Scotland

Learning & Teaching Scotland

Mental Health Tribunal for Scotland

Police Complaints Commission for Scotland

Private Rented Housing Panel

Public Transport Users Committee for Scotland

Royal Commission on the Ancient and Historical Monuments of Scotland

Scottish Arts Council

Scottish Charity Appeals Panel

Scottish Commission for the Regulation of Care

Scottish Industrial Development Advisory Board

Scottish Local Authorities Remuneration Committee

Scottish Police Services Authority

Scottish Records Advisory Council

Scottish Screen

Scottish University for Industry

Given the changes in the Scottish Government's devolved powers since devolution it is not possible to apply a direct like with like comparison in Scottish Government funding levels between 1999-00 and 2025-26. Similarly, the powers and responsibilities of Local Government have changed over that time, most notably due to the devolution of around £5.6 billion for the administration of social security benefits, as well as the transfer of Police and Fire services out of Local Government in financial year 2013-14 which resulted in over a £1 billion adjustment to General Revenue Grant.

As part of the 2024-25 Scottish Budget, Scottish Government made available £144 million to councils who chose to maintain Council Tax liabilities at 2023-24 levels. This funding, equivalent to a 5 per cent increase nationally, ensured that councils agreeing to maintain rates were fully funded for that decision thereby protecting both local government budgets and household incomes.

Throughout engagement with COSLA, Councils and opposition parties ahead of the 2025-26 Scottish Budget, there was a clear consensus that Councils should have full flexibility for decisions on council tax rates. The Scottish Budget delivered that ask in full as part of a record Local Government Settlement worth over £15 billion including real terms protection of General Revenue Grant, another key ask of COSLA and opposition parties.

Decisions on Council Tax are therefore a matter for Local Authorities to take in consultation with local communities.

As councils apply that discretion and the impact on low and middle-income households becomes clearer, the most financially vulnerable will continue to be protected through the Council Tax Reduction (CTR) Scheme. The CTR scheme exists to ensure that nobody in Scotland should have to meet a council tax liability they cannot be expected to afford, and reduces a household’s liability based on an assessment of their income, capital, and other circumstances. Over 460,000 households receive some level of CTR, and on average recipients save over £850 a year.

Whilst the vast majority of funding distributed to councils through the Local Government Settlement is distributed using a needs-based formula, including factors such as population, rurality, road length and deprivation, there are a number of discrete funding lines to respond to specific local needs both within and out with the Local Government Settlement.

These include, but are not restricted to, specific funding for inter-island connectivity is currently only available to councils with island communities and specific grants are provided for Vacant and Derelict Land and Regional Transport Partnerships in specific local authorities. Such funding streams are included in the Local government finance circulars - gov.scot which will be published once the Local Government Finance (Scotland) Order is agreed by the Scottish Parliament.

The information requested is not currently held centrally and could only be obtained at disproportionate cost.

The 2025-26 Scottish Budget will deliver record funding of over £15 billion for Local Authorities, a 4.7 per cent real terms increase, along with full discretion over Council Tax.

More frequent and meaningful budget engagement with COSLA and Councils was fundamental to informing the record funding settlement made available to Local Government in the Scottish Budget 2025-26.

Ultimately it is the responsibility of individual local authorities to manage their own budgets and to allocate the total financial resources available to them, on the basis of local needs and priorities but Scottish Ministers remain committed to ongoing meaningful engagement to ensure the sustainability of local services.

The average length of the local authority funding settlement since 2014-15 has been one year.

The opportunities of introducing three-year settlements are well understood but there are significant financial risks of doing so without the equivalent clarity from the UK Government given prominence of the adjusted block grant in the Scottish Government’s funding position. It is hoped that the conclusion of the UK Government’s Spending review later this year will create the foundations to allow the Scottish Government to adopt a multi-year approach to funding public services in Scotland. This will be taken forward through the next Scottish Spending Review.

While ring-fenced funding is provided to support increased investment in services such as our schools, inter-island connectivity and criminal justice social work, this represents only 2.7% or £0.4 billion of the overall Local Government Settlement in 2025-26.

Comparisons prior to the historic Concordat agreement in November 2007 do not represent a like for like comparison as Local Government funding changed significantly in 2008-09 when the majority of the former ring-fenced grants provided in the previous year were baselined into to the settlement.

Whilst not directly comparable, the best available data, as published in the Local Government Finance Circular 19/1998 indicates that specific grants worth £543 million were allocated to councils in 1999-00. This was equivalent to 8.29% of ‘Total Aggregate External Finance’.

The Plan for Steel hasn’t been published yet so the Scottish Government has not made an assessment of reported plans for the UK Government to support Scotland’s steel sector. An assessment of confirmed UK Government plans and support will be made following the publication of The Plan for Steel. The Scottish Government will be contributing to the steel strategy consultation; and we will continue to represent the sector, including via my membership on the UK Steel Council.

In addition to the Scottish Government’s previously announced Grangemouth Just Transition Fund, which will support the transition of the industrial cluster in its entirety to help secure a long-term and sustainable future, the Scottish Government has announced £25 million targeted investment for the vitally important Scottish industrial site.