Letter to Cabinet Secretary for Finance & Local Government: Scottish Budget and Spending Review 2025

This letter was sent to Shona Robison MSP, Cabinet Secretary for Finance & Local Government on the 17^th of December 2025 from Anna Fowlie, Chief Executive, SCVO and Alan Stevenson, Chief Executive, Volunteer Scotland.

Dear Cabinet Secretary  

We write to you as the leaders of Volunteer Scotland and the Scottish Council for Voluntary Organisations (SCVO) regarding the upcoming Scottish Budget and Scottish Spending Review. We urge you to take this opportunity to deliver clear progress on Fair Funding – including meeting the full costs of employment in all grants and contracts issued by the Scottish Government and its agencies to the voluntary sector. 

For too long voluntary organisations have had to contend with public sector grants and contracts that fail to meet the cost of delivery. Over the course of this parliamentary term voluntary organisations have faced acute and growing financial pressures, as evidenced in the Scottish Third Sector Tracker. 

In recent years the voluntary sector has been presented with additional staffing related costs too. This includes the Chancellor’s increase to Employer National Insurance Contributions, at a cost of approximately £75 million, plus inflation, to Scotland’s voluntary sector every year. More recently, the UK Government announced further increases to the National Minimum Wage and the National Living Wage. In line with our shared commitment to Fair Work, we welcome these rises and support further progress towards the Real Living Wage. Nevertheless, for organisations delivering Scottish Government-funded services, these changes mean new and unavoidable workforce costs. In line with your government’s commitment to Fair Work, we call on you to ensure that grants and contracts fully meet these increased staff costs.  

SCVO’s Spending Review Briefing sets out the wider challenges facing the sector and highlights the need for sustained action on Fair Funding, including the expansion of multi-year funding settlements. These calls are echoed across the voluntary sector and were supported in last year’s report from the Scottish Parliament’s Social Justice & Social Security Committee .  

We welcomed the Scottish Government’s ‘Fairer Funding’ pilot of over £120 million across two years, for which initial feedback has been positive. Indeed, the Scottish Government’s evaluation of the Fairer Funding pilot shows that most participating organisations experienced greater stability — including improved staff recruitment, better organisational planning, reduced uncertainty and stronger staff retention — demonstrating the positive impact that multi‑year, more predictable funding can deliver.

The forthcoming Scottish Budget and Scottish Spending Review bring the opportunity for the Scottish Government to make good on its commitments to improve the funding landscape for Scotland’s voluntary sector, providing stability to voluntary organisations delivering vital work in communities across Scotland on behalf of the Scottish Government. At a time when adult formal volunteering participation levels are only beginning to recover to pre-pandemic levels, we call for the Scottish Government to prioritise Fair Funding in the upcoming Scottish Budget. 

We look forward to receiving your response in due course.

Yours sincerely,  

Anna Fowlie, Chief Executive, SCVO
Alan Stevenson, Chief Executive, Volunteer Scotland