SCOTTISH Ministers have demanded Chancellor Philip Hammond ditch George Osborne’s “damaging austerity agenda” when he gives the Autumn Statement in Westminster this afternoon.

Traditionally, the draft Scottish Budget is produced in September, but Finance Secretary Derek Mackay pushed it back until December, saying it be would foolish to publish Holyrood spending commitments amid uncertainty over what Hammond’s first post-Brexit statement might mean for the block grant.

It seems almost certain growth will be revised down, and inflation will go up, when the Office for Budget Responsibility publishes its forecasts alongside the Chancellor’s statement.

Although the Government has scrapped George Osborne’s commitment to eliminate the deficit by 2020, it’s thought the Chancellor will be unlikely to add too heavily to public debt. At the same time, Theresa May has committed the Government to do more to help those “just about managing”, the so-called JAMs, many of who were affected when Osborne announced £3.4 billion of welfare cuts in his Budget earlier in the year.

Speaking ahead of the Autumn Statement, Mackay said: “The difference in approach towards how we grow our economy could not be more different between our two governments. In stark contrast to the silence and inaction of the UK Government, we have taken swift action in the wake of Brexit to support the economy by bringing forward an additional £100 million of capital investment.

“This Government is already facing real-terms cuts from the UK Government every year until at least 2019-20 – further reducing funding for our public services and undermining our work to build a fairer country.”

Mackay sais the Scottish Government’s discretionary budget has been cut by £3.3bn in real terms, or 10.6 per cent, since 2010-11 and within this, the capital budget has fallen by £600m or 15.7 per cent.

Any cuts to departmental spending announced by Hammond today, will see a corresponding reduction in the block grant.

OBR predictions after the last Budget in March had GDP growth reaching two per cent this year, before hitting 2.2 per cent in 2017, and 2.1 per cent in 2018, 2019 and 2020.

Given the average of independent forecasts, it’s expected new forecasts will predict UK GDP to rise by two per cent this year, but it growth will fall back to 1.3 per cent next year, and 1.5 per cent in 2018.

Under the Osborne austerity regime, cuts to public spending, would see Government borrowing hit £55.5bn for 2016/17, before falling to £38.8bn in 2017/18, £21.4bn in 2018/19 and reaching a surplus of £10.4 billion in 2019/20.

Having “reset” Tory fiscal policy, Hammond has some room to let borrowing take the strain, rather than more cuts, though he has insisted the Government will maintain “fiscal discipline” and return “the budget to balance over a sensible period of time”. Institute for Fiscal Studies director Paul Johnson predicted a cautious Hammond would opt for a “watch and wait” Autumn Statement.

“We are uncertain about quite how big the effect on the economy of the Brexit vote will be in the short run, and we don’t know what our relationship with the EU will be in the long run, which will have a big effect on our growth,” Johnson told BBC Radio 4’s World At One.

“So I think the Chancellor will be waiting to see what some of these decisions are, and where the economy comes out in six or 12 months, and then make some of the big decisions on spending and tax that he may do through his chancellorship.”

The Fraser of Allander economic institute at Strathclyde University warned the Scottish budget could be hit by the terms agreed in the fiscal framework, where ministers will have to take into account not the revenues raised from taxes devolved to Holyrood, but “the relative growth rate of the revenues devolved to Scotland compared to the growth rate of equivalent revenues in the rest of the UK”.

In a blog, David Eiser from Fraser of Allander wrote: “The OBR is likely to revise down its revenue forecasts for the UK as a whole. But this in itself may not spell bad news for the Scottish budget outlook. The Scottish budget is protected from revenue shocks that hit the whole of the UK equally. It is not until the Scottish Government publishes its own revenue forecasts alongside its Draft Budget in December that we will get a real sense of what the devolution of tax revenues to Scotland might mean for the 2017/18 budget.”