A WATCHDOG has warned that the Scottish Government could struggle to recruit the skilled staff needed to implement its new financial powers.

Money raised in Scotland will rise from around £4 billion before the 2012 and 2016 Scotland Acts were introduced, to £22bn by 2020.

Audit Scotland said the scale of change needed to set up and manage new responsibilities for taxes, social security and borrowing had resulted in “significant staffing implications”.

More than half (52 per cent) of Scotland’s budget will be raised directly in Scotland, compared to just a tenth in 2014/15. Auditors said the number of full-time equivalent government staff had fallen by six per cent from 5491 in March 2010 to 5152 six years later.

“Successfully implementing and managing the new financial powers will require enough staff with the right knowledge and skills,” its report said. “Recruiting staff with the technical experience required, for example in finance and programme management, may prove difficult.”

Audit Scotland said difficulties had already become apparent in recruiting to the Scottish Fiscal Commission, the body that will provide financial forecasts for Scotland.

Recruitment campaigns between September and December 2016 did not fill all the posts on a permanent basis, including the chief executive position.

Auditors also said Scottish Ministers must develop effective arrangements to manage the new powers and provide “clear, reliable and easily understandable” economic and financial information. They praised the Government’s “good programme management” in place but called for a “clearer picture of potential future costs” and regular monitoring of spending, highlighting that expenditure is due to increase “significantly” over the next four years through devolution of new social security powers.

Caroline Gardner, Auditor General for Scotland, said: “Implementing and managing the new financial powers will transform the work of the Scottish Government on an historic scale. It’s made some good progress by getting the foundations in place for managing the new powers but the major funding and staffing implications of the next stage of financial devolution must be planned for and managed in an open and transparent way.”