In 2011, the Christie Commission was tasked to study the future delivery of public services in Scotland. In its final report, Dr Campbell Christie CBE warned:
The demand for public services is set to increase dramatically over the medium term – partly because of demographic changes, but also because of our failure up to now to tackle the causes of disadvantage and vulnerability, with the result that huge sums have to be expended dealing with their consequences.
Dr Christie’s recommendations for how to deal with the situation included a call for prioritising expenditure on public services which prevent negative outcomes from arising and thus decrease demand for services which correct these negative outcomes. Since then ‘prevention’ has transformed into a household term in policy, making its way into various strategies and frameworks. However, in June 2025, the Minister for Public Finance acknowledged that the vision presented by Dr Christie “has not been delivered to its full potential. “
This blog introduces the financial side of prevention, including how the Scottish Government has approached it, and considers how funding could be rerouted towards a preventative approach. It has been produced by Ota Dvorak, EngD student at the University of Edinburgh, as part of a UKRI policy internship. As with all guest blogs, what follows are the views of the author at the time of publication and not those of SPICe, or of the Scottish Parliament.
SPICe previously published a blog on The ongoing pursuit of ‘prevention’ in health and social care which looked at the positioning of ‘prevention’ in recent health and social care strategy documents. In this blog, we look more at the financial side of prevention – linking resource allocation to outcomes and quantifying and capturing value across multiple sectors.
We encourage the reader to find out more information about preventative approaches in Scotland in our briefing on preventative spending.
What is prevention?
There are factors, which influence demand for public services, that The Health Foundation calls “The Building Blocks of Health”. For example, living in damp and cold housing is a risk factor that can make people more likely to be hospitalised with respiratory disease.
Prevention, in the context of public services, is about creating policy and allocating resources in a way which reduces people’s exposure to risk factors, makes them more resilient to risk factors, builds up people’s “building blocks of health” and makes it possible to identify problems early and act quickly.
What is the Scottish Government trying to prevent?
The Scottish Government has referred to prevention as a “principle”, or a “pillar” in many of its strategies and frameworks. However, the Government has not been specific in saying exactly what it is that it is trying to prevent. The Programme for Government 2025 to 2026 makes a few specific mentions of prevention: preventing homelessness, GP visits, further health harms and onwards transmission of blood borne viruses and, preventing people from becoming perpetrators of retail crime. Contrasting this with the Government’s four priorities of “growing the economy, eradicating child poverty, tackling the climate emergency, and ensuring high quality and sustainable public services”, it is not exactly clear what role prevention plays in the Scottish Government’s programme beyond that of a principle.
In a recent blog article, the Fraser of Allander Institute (FAI) identified a need for clarity on what is being prevented as being one of the fundamental blockers to progress on prevention. Referencing the First Minister’s remarks about the cornerstone of the Scottish Government’s approach to tackling child poverty, and the related attainment gap, being investment in generous social security support, the FAI questions whether social security can be a preventative policy:
If your outcome is improving educational outcomes or reducing health inequalities, then social security would go in the primary prevention box. If your outcome is reducing child poverty, then, arguably, at best it’s tertiary prevention, but could justifiably be argued as acute spending.
This is important not just to give clarity on objectives, but also because of accounting. The Scottish Government says it wants to shift “focus and expenditure towards agencies and services which take a prevention-first approach.” Following the above example, should the Scottish Government be shifting focus towards or away from social security? The answer depends on what is being prevented. If the Scottish Government is trying to prevent children dropping out of school due to poverty, it should spend more on social security. If it’s trying to prevent children from ending up in poverty in the first place, it should instead focus on actions which prevent child poverty.
Re-routing the river of public service spending
Public service budgeting and spending follows set procedures, and prevention does not fit neatly into them. Below we explore some of the financial and procedural hurdles in implementing more preventative action.
Allocating resources based on outcomes
Scottish Budget allocations are organised by portfolio, rather than by outcome, and Level 4 Budget lines (the most detailed published) often give little indication as to what the money is spent on. This is especially the case with the funding for NHS Territorial Boards, a Level 4 line worth about 18% of the Scottish Budget. How much of this £12.4 billion is going towards prevention is currently impossible to say.
The Scottish Government said, in a follow-up letter to the Health, Social Care and Sport Committee following post-Budget scrutiny 2026-27, that it will be piloting an approach to track preventative spending across the Scottish Budget in 2026. According to the Scottish Government, this should provide a “comprehensive understanding of preventative spend, with a view to integrating this approach into an annual reporting cycle from the 2027-28 Budget.” The Government will use results of the pilot “to explore how cross-cutting prevention issues can be considered in decisions over future funding allocation.”
Cross-party think tank Demos proposed a potential solution to this problem in the form of Preventative Departmental Expenditure Limits (PDELs) in UK budget-setting. Demos suggests that PDELs should be introduced in parallel to Capital Departmental Expenditure Limits and Resource Departmental Expenditure Limits to protect and control spending on prevention. According to Demos, this should better reflect the difference between spending on acute and more “upstream” services:
There is a qualitative difference between spending on acute services and those that seek to get upstream and shape positive outcomes. […] Unfortunately, the way that we distribute, account and report on public expenditure does not recognise this difference.
PDELs should, according to Demos, make it possible to “classify and ring fence preventative investment, injecting long-termism into public spending.”
However, this would represent quite a significant shift in approach to public sector accounting conventions and there is no indication that the UK Government is likely to move in this direction. It would also then be unclear how this would feed through into budgets for devolved administrations.
Even if that was achieved, this approach might encounter further challenges in Scotland. The delivery of public services is in many cases within the remit of Local Government. The Verity House Agreement, a partnership between COSLA and the Scottish Government, sets out that “the default position will be no ring-fencing or direction of funding, unless there is a clear joint understanding for a rationale for such arrangements”. Additionally, when the Finance and Public Administration Committee probed the Scottish Government about classifying preventative spend during its 2025-26 Budget scrutiny, the Cabinet Secretary for Finance and Local Government reminded the Committee that “classifications of public expenditure as set out in the Budget document are dictated by the UK public expenditure framework within which the Scottish Government is required to operate”.
All of this means that even if the Scottish Government leans hard into the prevention agenda, develops a comprehensive set of goals and defines what it is trying to prevent, it will still have to solve the problem of finding a way to allocate money to this agenda.
Who pays for prevention and how?
Preventative approaches might have the potential to create long-term savings by reducing demand for reactive public services. However, there are situations, where the spending for the preventative intervention lies with a different spending area than the spending area which will feel the demand reduction.
Hypothetically, if money is spent to improve homes and reduces people’s exposure to cold and damp conditions, this might bring savings to local NHS Boards, which will have to deal with fewer hospitalisations due to respiratory problems. But it might be challenging for the area of government which invested in this housing improvement to financially justify the increased spend on housing when the benefits will not necessarily accrue to this area of government.
It’s important to remember that one of the reasons prevention is being talked about is that some public service providers are struggling to achieve financial balance and have had to rely on additional in-year funding in order to provide services. It might be difficult for organisations to find money to invest into preventative approaches among these short-term pressures, despite studies suggesting that preventative spending is more cost-efficient.
What does prevention pay for?
While it might seem logical that investing in prevention has the potential to save money long-term, in the Scottish context as of March 2026, this argument is speculative. We are not aware of a study which would quantify the return on investment for preventative interventions in Scotland. Therefore, even though some consider prevention to be the more cost-effective solution to increasing population health, lack of comprehensive and robust evidence for this claim might disincentivise public service providers from spending money on prevention. It might make it easier for organisations to prioritise acute “frontline” spending because at least the costs and effects are known. Targets such as waiting times can also make it difficult to resist directing funds to these immediate pressures.
HM Treasury provides some guidance on how to quantify wellbeing approaches in its Well-being discussion paper: monetisation of life satisfaction effect sizes, published as supplementary guidance to The Green Book and reminds us that “The scope of all appraisals is UK society”. Quantifying the effects of preventative approaches might therefore be a mammoth task and it appears that nobody in Scotland has attempted it yet. While this does not mean that it is not a task worth doing, the current evidence base for the cost-effectiveness of prevention remains largely speculative or anecdotal.
Whose responsibility is prevention?
Prevention might offer a potential solution to the public service sustainability and performance challenges. But who is responsible for pulling the lever which redirects the flow of public service spending?
Should it be done from the bottom-up with individual service delivery organisations prioritising preventative activities and projects? This might play into what some would call community-powered service delivery. But how can this be scrutinised, directed, checked, and evaluated at a national level? The data does not exist at the moment, and many of these organisations are already under immense pressure to function day-to-day without having to plan, fund, and execute their own reform at the same time.
Or should it be done from the top-down, as suggested by Demos using PDELs to ring-fence prevention spending, and using proper Government guidance and accompanying budget-making changes? Demos suggests this would involve HM Treasury setting up a Preventative Investment Unit which would oversee this activity across all Departments (in Scotland, the equivalent might be a unit set up by the Cabinet Secretary for Finance). But the HM Treasury (or the Cabinet Secretary for Finance) is not the delivery body for any of these services, and this approach would require buy-in from local governments and service delivery providers, which have openly stated they are against directed spending and ring-fencing. It would also require a quite significant shift in public sector accounting standards, which would be difficult to achieve.
Not being clear who’s responsible for prevention also makes it difficult to scrutinise progress. In Session 6 of the Scottish Parliament, the Scottish Government received questions about prevention from at least three committees. Should oversight of scrutiny of prevention lie with one committee? If so, which one? Or should it be a part of the scrutiny of all committees? Or should there be a dedicated prevention scrutiny group? A similar line of thinking and questioning could be applied to Scottish Government Directorates.
Conclusion
The motivation for implementing preventative approaches in Scotland has not changed in over a decade. While the Scottish Government and committees of Scottish Parliament have shown a growing focus on prevention, there remains a lot of work to do to untangle the rhetoric around prevention and transform it into powerful, meaningful action.
New committees will be likely to take a keen interest in how prevention features in the first budget round of Session 7 towards the end of this year. In the meantime, find out more about preventative approaches in our in-depth briefing.
Ota Dvorak, UKRI internship placement