Economic alliance Prosper have outlined recommendations for the decision next week.
The upcoming Scottish Budget must deliver vital support for employers to mitigate rising national insurance costs and support third sector organisations, economists have said.
Economic alliance Prosper has published its recommendations, highlighting that the revenue-raising measures announced by the - particularly the changes to employers’ National Insurance (NI) contributions - are putting even more strain on the finances of many employers in the third and private sectors in Scotland.
The group warned those hit by rising costs include those providing key public services such as social care, youth work and education.
Finance Secretary Shona Robison should use her limited room for manoeuvre in next week’s Budget to help employers with cost pressures and provide a stable platform for growth, Prosper said.
They are asking that Scottish Government funding, grants and contracts for organisations providing public services in Scotland - including third sector organisations - is increased to cover in full the additional costs from the changes to employers’ NI contributions and National Living Wage.
While the changes made in the UK Autumn Budget will provide a very significant uplift to the Scottish Budget which will relieve some of the immediate pressures on it and Scotland’s public services, there will still be restrictions on the funding that is available. Prioritisation will be essential to provide the stability and certainty needed at this time.
Sara Thiam, Prosper chief executive, said: “Many of our members are currently experiencing high costs pressures and they are looking to Scotland’s Finance Secretary to do all that she can within the headroom available to provide a stable platform for investment, jobs and growth.
“Our proposals are practical steps to support progress on these priorities and Scotland’s key opportunities.”
Prosper also said it will be critical that the Scottish Spending Review - which is also expected next year - tackles the challenges to the long-term fiscal sustainability of the Budget, and invests in growing the economy and tax base, and in transforming public services through a public sector productivity and reform programme.
A critical enabler of this should be the introduction of multi-year finance settlements - including for third sector organisations.
