Grim economic forecast suggests stormy days ahead

Where will the spending pressure be felt next? The voluntary and third sector providing public services is vulnerable to funding cuts from both Scottish and local government.

The sector typically delivers important services, from social care to mental health support, direct to the public, employing staff on year-to-year contracts, rarely matching the pay, pensions and job security of those directly employed by government.

The battle so far is about in-year cuts for 2024-25, removing funds for spending due to take place before next April. The budgets for next financial year are also being drawn up, and look no less daunting for finance ministers in Westminster and Holyrood.

As MSPs prepare to return to Holyrood next week, and as MPs get used to the changed terrain dominated by Labour at Westminster, skirmishes over the looming squeeze aim to shift blame.

Sir Keir Starmer is expected to to talk of “rubble and ruin” left by outgoing Tories. They respond that their economic legacy was about to start an upswing, and Labour’s preparing us for tax increases.

Labour’s Scottish leadership wants to pin the blame on SNP “mismanagement” of public funds, criticising higher income tax. The SNP is eager to warn of Labour “austerity”.

Stepping back from the blame game, what does all of this mean for the future shape of the public sector?

If it is to become smaller, in headcount and tax take, can it become more productive and efficient? Or will we have to adapt to lower expectations of what it delivers?

If it is to be reformed – perhaps a smoother patient journey through the NHS, or less rigidity in the Scottish teachers’ working contract – what would that look like?

What would it cost to secure those reforms in terms of pay?

And what would those of us who use public services expect at the end of it?