Background

The Board approved the 2025-26 annual budget on 27 March 2025 which set out the spending plans for Police Scotland, Forensic Services and SPA Corporate regarding revenue, capital, and reform for the coming financial year.

The Authority received a core revenue funding increase of £56.7m (4.1%), plus an additional £15.2m to fund 60% of increased national insurance costs and an additional £10.0m to support reform and modernisation. The remaining national insurance costs will be funded in 2025-26 through reduced employer pension contributions, however, savings are required to be identified in-year for delivery in 2026-27 to fund these costs on a recurring basis.

The budget for 2025-26 includes a core budget for around 16,500 officers and an average 5,900 FTE police staff. National insurance changes resulted in a £25.3m cost pressure for policing. The annual pay award is also a significant year-on-year pressure, with every 1% pay increase costing an additional £12.5m. Other pressures include new technology costs, general inflation and other specific price increases.

The budget includes vacancy management savings and an income challenge to be delivered as part of the overall budget, as well as over £9.0m of non-pay savings and efficiencies - a highly challenging requirement given that only 14% of the budget relates to non-pay costs.

The reform budget to support change and transformation for 2025-26 is £20.3m. The budget includes £16.2m of overprogramming to be managed in-year as the work progresses on the prioritisation of change.

The total capital allocation for 2025-26 is £71.0m including capital receipts. This investment marks the starting point of delivery of the estate’s masterplan, supports the rolling replacement programme and progress change and transformation programmes. It is recognised that additional resources are required in key enabling functions to support and deliver an increased capital programme.