Holyrood funding deal agreed in principle, Nicola Sturgeon says


The UK and Scottish governments have struck a key deal over future funding which will ensure "not a single penny" is cut from Scotland's budget in the next six years, the First Minister has said.

Negotiations between the Treasury and the SNP administration in Edinburgh had appeared to be in deadlock, with both sides struggling to reach agreement over how the block grant Holyrood receives from Westminster should be adjusted once new income tax powers are devolved as part of the Scotland Bill.

Nicola Sturgeon announced to MSPs that following a telephone conversation with Chancellor George Osborne, "there is now an agreement in place in principle that I believe we can recommend to Parliament".

She added that transitional arrangements to be put in place meant "this deal will not allow a single pound or even a penny to be taken from the Scottish Government budget" up until March 2022, when the method for adjustments will be reviewed.

The deal comes after 10 rounds of talks between the Scottish and UK governments involving Ms Sturgeon, Mr Osborne, Prime Minister David Cameron and Scottish Deputy First Minister John Swinney.

Mr Osborne said: "Today we've secured a stronger Scotland in a stronger UK.

"The arrangements we've reached with the Scottish Government are fair to Scotland and fair to taxpayers in the rest of the UK.

"This enables us to deliver on the vow we made to the Scottish people and delivers one of the most powerful devolved parliaments in the world and the economic and national security that comes from being part of the UK.

"This clears the way for the debate in Scotland to move on to how these tax and spending powers should be used."