Experts warn of spending squeeze

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The winner of the Holyrood election would have little scope for extra spending over the next few years, experts have warned.

They also raised concern over whether the drive to make efficient savings would hit services.

The comments came from a body run by Glasgow and Strathclyde universities.

It said the SNP was likely to have the most money available for uncosted spending, but warned the party was also the most reliant on efficiencies.

The Centre for Public Policy for Regions (CPPR) came up with the figures by analysing individual party manifestos, along with the money likely to be available to the Scottish Executive over the next four years.

The body is a major research initiative being jointly pursued by the Universities of Glasgow and Strathclyde.

The delivery of efficiency savings is clearly the key to many of the parties (plans) Jo ArmstrongCPPR consultant

On its website, it says that it "looks at the role of public policy in promoting economic and social development in Scotland and beyond".

It estimated that between 2007 and 2011 the executive would receive an extra £3.377bn for new spending commitments, but staff costs could account for half of this, leaving just under £1.7bn.

The centre also found the Scottish Tories had the fewest uncosted manifesto commitments, at 17.

The Scottish Greens had 39, Scottish Labour 77, the Scottish Liberal Democrats 89, and the SNP 35.

<ul class="bulletList"><li>Scottish Conservatives - costed spending would account for £917m, while £100m would be raised in costed efficiency savings. Switching existing spending to new areas would free up another £778m, making a total of £1.65bn available for uncosted spending.</li>

<li>Scottish Labour - costed spending would account for £1.781bn, while £1.2bn would come from efficiency savings, leaving £1.109bn for uncosted spending.</li>

<li>Scottish Liberal Democrats - costed spending would account for £1.208bn, while £500m would come from efficiency savings and £182m from switching existing spending to new commitments. This would leave £1.163bn available for uncosted spending.</li>

<li>SNP - costed spending would amount to £2.538bn, while there would be £1.34bn in efficiency savings and £1.33bn from switching existed spending, making £1.821bn available for uncosted spending.</li></ul>

The first year of a Scottish Executive drive to obtain efficiency savings amounted to £500m, but watchdog Audit Scotland found it difficult to confirm these were true efficiency savings.

And there was a "significant possibility" that the report's underlying assumption of a 2% inflated-adjusted increase in the Scottish budget could be too optimistic, the experts added.

Their report stated that there would be "significant pressure" on the Scottish budget in the next few years, adding: "This leaves little room for significant additional spending by any incoming administration."

Service levels

The experts also questioned the ability to deliver efficiency savings "without having a detrimental effect on service level, if we are not talking about fundamental structural change within the public sector".

One of the centre's experts, independent consultant Jo Armstrong, said: "The delivery of efficiency savings is clearly the key to many of the parties (plans).

"I do question the ability to deliver them without having a detrimental effect on service level, if we are not talking about fundamental structural change within the public sector.

"We have already had a major programme of activity, and we can't say that hasn't affected service levels.

"To pile another one on top of that would clearly be do-able, but will it affect service levels? That is something that needs to be questioned."