Block Grant funding

Block Grant funding is split into two parts: Barnett and non-Barnett funding.

Barnett funding is the largest of the two and is generated when the UK Government allocates funding to UK Government departments to be spent on areas which are devolved, for example health. The Barnett formula is applied to this UK Government spending allocation to calculate a corresponding proportion of funding for the Scottish Government.

Non-Barnett funding is a small portion of funding (around 1 per cent of the Scottish Budget)  transferred between the UK and Scottish Governments outside the usual Barnett arrangements – that is, the amounts are not calculated with the Barnett formula.

Block Grant funding is set before the start of each financial year based on the most recent source of UK Government spending allocations. If the UK Government increases or decreases this planned spending, funding for the Scottish Budget is adjusted accordingly using the Barnett formula. These adjustments are called Barnett consequentials.