BUDGET pressures could mean Scotland’s health boards experience “degradation in service quality” unless efficiencies are made, a think tank warned today.

Looking at the Scottish government’s draft budget — expected to be approved later this month — the Institute of Fiscal Studies (IFS) has found that while overall spending on health and social care is planned to grow by 2.4 per cent in real terms over the next three years, health boards will see “just one-sixth the rate of the overall increase” at 0.4 per cent.

The think tank went on to warn that this “very slow rate of growth” would “require big increases in efficiency and productivity to avoid degradation in service quality.”

IFS found that day-to-day spending on health and social care would grow by just 0.2 per cent in 2026-27, but after transfers were made to councils to cover increases in pay for social care workers, it would amount to a cut of 0.6 per cent.

That cut, taken alongside the Scottish government’s “highly ambitious targets for efficiency savings,” has led the think tank to warn that it is “highly likely” government will need to step in to top up funding over the course of the coming year.

IFS research economist and co-author of the report, Martin Brogaard, noted that the Scottish government was “banking on big improvements in hospital and ambulance service productivity” in order to “enable health funding to stretch further.”

He added: “The Scottish government faces a difficult funding outlook, which necessitates tricky trade-offs between different areas of both day-to-day spending and investment spending.”

Scottish Health Secretary Neil Gray responded: “Our draft budget includes record funding of £22.5 billion for health and social care to support a more sustainable and resilient system.

“Our plan is delivering: long waits have reduced for seven consecutive months, we are seeing downward trends across nearly all waiting list indicators, and thousands more appointments, operations and procedures are being delivered this year.

“Scottish public finances continue to face a challenging fiscal environment, which is why the spending review also set out efficiency and reform plans, detailing how £1.5bn of cumulative savings will be delivered, including £0.6bn in 2026-27.

“Tough choices, reform and efficiencies are all needed to balance the demands for public spending within our funding constraints.”