By STEWART PATERSON

Political Correspondent

Finance Secretary, Derek Mackay, has been accused of keeping a “slush fund” to use in talks with the Greens to get his budget through.

Glasgow Labour MSP, James Kelly, made the claim after Mr Mackay found an extra £170m for local government funding to secure Green MSPs’ support.

As the budget passed stage two at the Finance Committee in Holyrood concerns were raised that local councils were still not being properly funded and cuts were still needed.

Mr Kelly said: In terms of the money drawn from the underspend and the Scotland reserves, that’s £110m. This is similar to last year when £120m was drawn down.

“Is it not the case that what you are doing is that you’ve got that block of money set aside almost as a kind of slush fund for your negotiations as part of the parliamentary process?”

Mr Mackay hit back stating: “I wouldn’t describe it as that Mr Kelly. You can term it in any way you want.”

He said if using any underspend to agree parliamentary support it was a “good thing” and better than any proposals from the Labour Party.

He added it was a “prudent, wise and transparent” use of government resources.”

Mr Mackay said that the budget deal now means local councils have enough cash they don’t need to make cuts.

Mr Kelly said that Labour would continue to oppose the budget because it still underfunded local councils.

He said: “The overall budget is still not fit for purpose. On local government, the NHS and tackling child poverty it doesn’t go far enough.”

Green leader Patrick Harvie despite agreeing the deal to back the budget said he wanted “future certainty” for councils that more cuts wouldn’t be needed.

He said: “We have managed to prevent additional cuts to local government.

“In previous years, local government suffered significant cuts and we have still not repaired the damage.”

He asked for a commitment that the extra cash found this year would be available next year too.

Mr Mackay however said that was not possible. “I’m hoping to get the 2018/19 budget through. I’m not proposing baselines for 2019/20. But I understand the point but I haven’t set that degree of certainty for any portfolio.”