In this final blog in our 2026 Scottish Budget series, we look at the funding settlements for key Regeneration stakeholders.
If you haven’t read our earlier pieces on the Scottish Budget, you can find the links to those here. This includes a general blog on regeneration funding in the Scottish Budget, and also a breakdown of how the budget delivers on our four key manifesto themes – housing, transport, local democracy, and fair funding.
Scottish Enterprise
Scottish Enterprise sees its funding fall by 4.8% to £237 million.
It should be stated that for all the Enterprise Agencies – Scottish Enterprise, SOSE, and HIE – the Scottish Government has stated that funding is incomparable year-on-year as these bodies are funded to deliver specific projects, which may vary significantly from one year to the next. Although this is true, it is noteworthy that of these three only SOSE has received a marginal funding increase (see below).
SOSE
South of Scotland Enterprise sees its funding increase by 4.4% year-on-year to £32 million.
HIE
Highlands and Islands Enterprise will in 2026-2027 receive around £56 million, a roughly 29% decrease year-on-year.
Highlands and Island Enterprise and Scottish Enterprise are both highlighted in the Spending Review as two public bodies which have seen significant reductions in operating costs – Scottish Enterprise saw a 16% reduction in FTE staff between Q2 2019 and Q2 2025, and HIE saw a 13% reduction in FTE staff between 2020 and 2025.
HES
Historic Environment Scotland sees its funding fall slightly to £68.8 million, a funding level the Scottish Government plans to maintain for the two years thereafter, according to the Spending Review.
Creative Scotland
As mentioned in our previous blog, Creative Scotland see a £20 million uplift for their multi-year funding programme – a model SURF would like to see rolled out more generally. This marks a third consecutive year with a significant increase in Creative Scotland funding, and a broader trend towards increased Arts and Culture spending.
It should also be noted that recent Creative Scotland outturns tend to be higher than the budgeted amounts (i.e. £51.4 million budgeted in 2024-2025 vs a 67.2 outturn; and £80 million budgeted in 2025-2026 vs a preliminary forecasted spend of £89 million).
Clyde Gateway
There is no detail on the funding settlement for Clyde Gateway in the budget – suggesting this is included within a wider budget line – so we still await clarity on this in future.
It should be noted that the Vacant and Derelict Land Fund will be absorbed by Regeneration Capital Grant Fund, but we do not yet know what the planned budget for RCGF is for 2026-2027.
Architecture and Design Scotland
Architecture and Design Scotland’s funding falls by around 13% to £1.56 million.
Conclusion
On the cusp of a Scottish Parliament election in May 2026 maybe it’s unsurprising that the above funding settlements do not set the regeneration heather on fire, but nor is it the fiscal cliff that’s long been talked about. In real terms, with capital and revenue costs continuing to rise, it is a slow squeeze. While some efficiencies may be achievable in the public sector it is important that neither it, nor the third sector, are asked again to do more with less.
However, as our first budget blog made clear, general Scottish Government regeneration spending will reduce in 2026-2027, with uncertainty around the continuation of key funding programmes, such as the Investing in Communities Fund.
If you have any questions about this piece or wish to highlight the impact of the recent Scottish Budget announcement on your organisation, please contact Augustijn van Gaalen, SURF’s Policy & Advocacy Manager, at augustijn@surf.scot.
