Consequential funding provides extra money for affordable housing and fuel poverty

Consequential funding provides extra money for affordable housing and fuel poverty

Finance secretary Kate Forbes

An extra £120 million has been provided for affordable housing following confirmation of a further £1.1 billion of consequential funding arising from UK Government coronavirus spending.

Finance secretary Kate Forbes has confirmed that a further £100m grant and £20m Financial Transactions will be allocated for affordable housing in 2021-22.

The announcement takes the Scottish Government’s investment in housing to over £3.5bn over the next five years, with more than £3.4bn delivering more social and affordable homes in communities across Scotland.

Ms Forbes is also allocating an additional £45m capital to heat decarbonisation, energy efficiency and fuel poverty for 2021-22, bringing the total for heat and energy efficiency to over £258m of capital.

Other extra spending in 2021-22 arising from the latest consequentials includes:

  • £120m for mental health
  • £100m to support people on low incomes
  • £60m for schools to help pupils catch-up on missed education
  • £60m for NHS recovery
  • £21.5m for Scottish Enterprise

Elsewhere, finance secretary Kate Forbes has outlined proposals which will see retail, hospitality, leisure and aviation businesses pay no rates during 2021-22.

The move builds on the three month rates relief extension announced in the Scottish Budget and will be taken forward provided the Scottish Government receives the funding already assumed from the UK Budget on 3 March, and that requisite funds are available to maintain existing support into 2021-22.

Newspapers will also continue to benefit from 100% relief for a further 12 months, while charitable rates relief will not be removed from mainstream independent schools until 1 April 2022 due to the ongoing impact of the pandemic.

Separately, local authorities will receive an extra £275m in the current financial year to address COVID-19 pressures, while a further £40m is being made available to support the safe reopening of schools.

Ms Forbes said: “When I presented our budget last month I guaranteed to extend non-domestic rates relief further if I was given the necessary resources. I can now deliver on that promise, providing the UK Budget in March delivers the funding we require.

“The other measures I am proposing today, including further support for hospitals, schools and local government and measures to tackle climate change, build on our priorities to ensure a robust recovery for our economy and public services.  

“This welcome additional consequential funding was confirmed to us yesterday and I wanted give early notice to parliament and provide clarity to businesses.

“We are still in the throes of a national emergency and it is important Parliament works together to respond. I will continue to work with all parties to help deliver a budget for the nation fit for these times.”

A copy of the finance secretary’s Budget Update statement to the Scottish Parliament is available online.

Last month’s Scottish Budget 2021-22 estimated how much consequential funding would flow from the delayed UK Budget on 3 March, with £500m assumed to be provided.

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