Scottish Government Budget 2025-2026: A missed opportunity to fund the third sector fairly?

5 December 2024

The 2025-2026 Scottish Government budget, published yesterday, was a great step forward in beginning the reinvestment process in our communities and valued local services. The commitment to developing plans to mitigate the two-child benefit limit underlines an approach from government that is based on fairness, justice and a commitment to eradicating child poverty.

The budget narrative clearly supported the TSI Scotland Network’s asks to invest in Public Service Reform combined with extra funds for social care and family support services as well substantial increases for our under-pressure NHS, housing and council services.

However, what is unclear is the method of investment in reform and change.  The old top-down models of investing in high tariff services will not meet the challenge of rising demand and an aging population.

For that we need to see the Scottish Government mandate the NHS and councils to collaborate with local communities and third sector organisations in commissioning and planning a fairly funded network of local services on a multi-year basis. Only then will be see a concerted shift in spend towards early intervention and prevention at a community level.

From an Argyll and Bute TSI perspective we will continue to build on our strong relationships with local statutory partners to explore new delivery models that recognise the importance of close and sustainable third sector partnerships that include the sector’s full costs when running allied or commissioned services.

It should also be noted that there remained concern over the lack of uplift in the Third Sector Infrastructure budget – which amounts to a real terms cut – as well as a lack of specific investment in Community Wealth Building.  As the budget is debated through Holyrood we would also like to see further detail on local climate action and consistent investment in employability programmes.

The TSI Scotland Network will continue to call on Government to ensure communities and a sustainably funded third sector are at the heart of public service reform. 

The Network has four main asks:-

Ask 1: Invest in collaborative third sector delivery models to support public sector reform

Ask 2: Fairer funding to enable the systems change the Scottish Government seeks

Ask 3: Direct funding to communities that is shaped by local people and groups

Ask 4: Support the TSI Scotland Network to lead on change and fund it to do so.

Notes to Editors:

1. The TSI Scotland Network is a body of expert charities that support, develop and advocate for the third sector and social enterprise and that also make it easier for people to volunteer with a focus on inclusion. There are 32 Third Sector Interfaces – or TSIs – across Scotland; one in each local authority area. 
2. A more complete list of analysis and asks from the Scottish Government’s Budget published by the TSI Scotland Network on 26^th November 2024 is available from our website here.
3. The third, community and social enterprise sector is the third largest employer by sector and across Scotland employs 133,000 people who are committed to improving our communities.
4. Each TSI is funded in part by the Scottish Government to help the third and social enterprise sector in the following ways:

• Build capacity
• Be a source of knowledge, training and support
• Connect partners
• Represent the sector