Forbes: Government will spend as much EU cash as possible

Deputy First Minister Kate Forbes has said the Scottish Government will spend as much of the EU funding as possible (Andrew Milligan/PA)

Kate Forbes has denied the Scottish Government is returning around £450 million of earmarked EU funds.

The Deputy First Minister refuted the claims as she stood in for John Swinney at First Minister’s Questions on Thursday.

Scottish Labour deputy leader Dame Jackie Baillie said it is a “scandal” that ministers have not spent the EU Structural Funds which had been allocated to tackle poverty across the country.

But Ms Forbes said the figure is “not recognised”, adding the Scottish Government will spend as much of the earmarked cash as possible by 2025.

A report by the independent Scottish Parliament Information Centre (SPICe) said the Government was initially allocated 941 million euros (£801 million), however the figure now stands at 783.4 million euros (£667 million) following a reduction of 157.6 million (£134 million) because annual expenditure targets set by the European Commission were missed.

The report said that as of June 4, 64% of the revised funding had been paid out to the Scottish Government, with 280 million euros (£238 million) – 36% – remaining.

It is expected a further two claims will be made by ministers, with the first likely to be submitted in July.

The SPICe report said that even after these claims are considered, around 136 million euros (£116 million) had not been committed to lead partners by the end of the 2023 deadline.

Speaking in Holyrood on Thursday, Ms Forbes said: “The SPICe report also indicates that that 450 million is not one that they recognise.

“Final expenditure figures will not be known until the programme formally closes in 2025. To have spent all the money a year in advance, I think, would raise questions itself.

“We do not expect the final figures to be markedly different from elsewhere in the UK or indeed from previous programmes. Our commitment is to spend as much of the money as possible.”

Jackie Baillie comments — Scottish Labour deputy leader Dame Jackie Baillie raised the issue in Holyrood (Jane Barlow/PA)

But Dame Jackie said the underspend is an indication of “SNP financial mismanagement” as she said her party’s analysis estimates around £5 billion of public funds hacw been “wasted” in 17 years of the current Scottish Government.

She said: “On Sunday it was revealed that the SNP will effectively hand back up to half-a-billion pounds worth of funding that should’ve been spent on crucial economic and anti-poverty projects across Scotland.

“That is simply a scandal and it happened when Kate Forbes was finance secretary.”

The “clawback in Scotland is likely to be greater than anywhere else in the UK”, she said, with a 28% figure likely in Scotland compared to 9% in Wales, 6% in England and 2% in Northern Ireland.

Dame Jackie told Ms Forbes: “This comes down to the financial incompetence of this SNP Government.

“At a time when people are crying out for help during a cost-of-living crisis and our public services are stripped to the bone, it is unforgiveable that the SNP is wasting taxpayers’ money.”