Scottish Chancellor of the Exchequer Ivan McKee said the new money available to the Scottish Government did not completely ease financial pressures.

He said most of the extra £1.5bn in the current financial year would be used to pay for pay rises already agreed in the public sector and that there was a relatively small portion of that figure available for capital spending on things such as infrastructure.

On compensation for changes to National Insurance, he said there were mixed messages.

“It seems like part of the UK government is saying one thing, but Rachel Reeves, who is the chancellor, the boss at the end of the day, is saying another and that is already included in the money we have been allocated.” said.

“So that’s a big unknown.”

McKee refused to be told what would be in the Scottish budget on December 4.

But when asked if he thought any further tax increases in Scotland would be counterproductive, he replied: “I think it’s a very important consideration.”