Following the dissolution of the Bute House Agreement with the Scottish Green Party in May, the SNP is operating as a minority government, requiring the support of at least three MSPs from other parties to pass legislation.

The most crucial test of this dynamic will be the Scottish Budget on 4 December and the SNP will almost certainly be prepared to make concessions to see its Budget Bill passed, however, the backdrop against which this  budget is being set is extremely perilous, not only financially but also politically.

After announcing £500 million of spending cuts in September, which included abandoning key Green Party policies, support from the former Bute House Agreement partners is far from assured and concessions demanded by the Greens could prove to be of a scale which the Scottish Government is unwilling, or unable to countenance. Other parties such as the Liberal Democrats could offer support, this too is far from assured, particularly if the price of their backing were the withdrawal of funding for the SNP’s flagship National Care Service, which the Scottish Government remains firmly committed to.

Failure to pass the Budget Bill leaves the door ajar for a potential early Holyrood election. If the Budget Bill were to be defeated, the Scottish Government would have to present an alternative Budget Bill, but if this were also rejected then the parliament would enter unchartered territory and it could be argued that the Government had lost the confidence of Parliament, and an election seemingly the only option to break the impasse.

The Scotland Act requires a two-thirds majority of all MSPs to vote for an unscheduled general election. Unlike in the Westminster system where an early general election results in a new five-year parliamentary term, the next scheduled election on 7 May 2026 will only be cancelled if an unscheduled election takes place within six months of that date. On this basis, the Scottish public could find themselves going to the polls twice in as many years.

If successive budget bills were voted down by parliament, but no early election was subsequently held, public funding of services would continue. Foresighted legislators anticipated this situation and provisions exist  that in the absence of a Scottish Budget, from the beginning of the next financial year (i.e. from 1 April 2025) the Scottish Government can still spend funds based on the previous year’s Budget, but as a monthly total this is restricted to the greater of one-twelfth of the previous year’s spending or the total spend in the corresponding previous month.

The Scotland Act provides that if the Scottish Parliament cannot agree to the Scottish rates and bands of income tax, they will default, perhaps unexpectedly, to the provisions of the Income Tax Acts – so reverting to the levels set by Westminster.  A new budget could reset this, but in the immediate term, the political consequences of such an eventuality could be seismic.

While it is a constitutional certainty that the Scottish Government will be able continue without a Budget being passed, the possibility of a significantly reduced funding envelope, and the prospect of a painful default to Westminster taxation norms, appears  to be underappreciated and certainly underdiscussed