The Scottish Budget has failed to “dispel the immediate sense of financial hopelessness felt by many of Scotland’s voluntary organisations”, charity umbrella body SCVO has said.
Earlier this week, Scotland’s finance secretary Shona Robison presented the Scottish Budget 2025-26, which she said delivered “on the priorities of the people of Scotland”.
Robison said the Scottish Government’s priority is to tackle child poverty by mitigating and ending the two-child cap, which will lift an estimated 15,000 children out of poverty in the country.
Her budget, which totalled £63.5bn of spending, provided a record £21bn for health and social care, with a record increase of £2bn for frontline NHS boards.
Robison announced a record funding settlement for local authorities, which will increase by over £1bn, and a record £34m increase for the culture budget.
Some of the charity-related measures include £21m to ensure early learning and childcare and children’s social care staff in private and third-sector commissioned services are paid at least the real living wage by April 2025.
In addition, the government will provide £125m for adult social care staff in private and third-sector commissioned services to ensure they are paid the real living wage by next April.
Meanwhile, the budget for the third sector infrastructure and development fell from £14.7m to £14.1m while that of the third sector criminal justice social work rose from £7.1m to £8.2m.
Lack of ‘concrete commitments’
In a blog, Kirsten Hogg, SCVO’s head of policy and research, said the budget offered “glimmers of hope” for the charity sector “but overall I’m not sure it will do much to dispel the immediate sense of financial hopelessness felt by many of Scotland’s voluntary organisations”.
“Ahead of the budget, SCVO made two asks of the Scottish Government: to work with us on mitigations to the rise in employer national insurance contributions (NICs), and to adopt the recommendations of the Social Justice and Social Security Committee pre-budget scrutiny on fair funding,” she said.
“On both, the budget contains the usual warm words, but not so much in the way of concrete commitments. It all feels a bit more ‘hope for the best’ than hopeful.”
In her budget, Robison criticised UK chancellor Rachel Reeves’ decision to increase NICs while the Scottish Government said it would continue to press the Treasury to fund this cost.
Hogg welcomed this but said the Scottish Government fell short of “putting its money where its mouth is and committing to cover those costs for the voluntary organisations it funds through grants and contracts, should the chancellor’s support not be forthcoming.
“That leaves many voluntary organisations facing the options of not being able to afford cost-of-living increases next year and/or making staff redundant,” she said.
“While the budget goes to great lengths to protect the number of teachers and police officers, and the public sector pay policy includes above inflation pay increases, it’s hard not to draw the conclusion that voluntary sector staff are considerably less important to the Scottish Government than their public sector counterparts.”
Charities at risk of closure
Hogg said it was difficult to understand some of the budget’s implications for charities as decisions about voluntary sector grants and contracts are made by individual departments.
“It’s interesting to note that for the first time (as far as I’m aware) this year’s budget contains a reference specifically to voluntary sector funding within the spending plans for community justice”, she said.
She added that the references to charities in the budget “suggest a (very) subtle shift in the positioning of the voluntary sector” but signalled a step towards improving understanding of the role and value of the sector.
However, she added: “My worry, though, is that without more immediate financial support, some voluntary organisations won’t be there to come on that journey with us. And [this week]’s budget doesn’t make me any more hopeful about that.”
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