Public sector pay demands, help for displaced Ukrainians and rising inflation have put “enormous strain” on Scotland’s budget, MSPs have been told.

Deputy First Minister John Swinney said that £500m in cuts had been identified in order to ease the pressure.

He said a lack of borrowing and an inability to vary income tax rates outside the normal budgetary timetable had left him with “no other choice”.

In a statement in the Scottish Parliament, Mr Swinney set out reductions to planned spending and forecasts which included:

• £53m in the budget for employability schemes
• utilising funding of £56m generated by the ScotWind clearing process
• £33m of ring-fend agricultural funds
• a reduction of £37m in the budget for concessionary fares

Mr Swinney said these decisions were not ones the government would have wanted to make.

But he added that it was important that the scale of the challenge was clearly understood, particularly by anyone negotiating further pay deals.

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