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Holyrood today heard about one side of the nation's ledger - the side that's intended to get the government through the next election.

The other side was not so obvious in John Swinney's budget statement to MSPs. That's where the cuts come, and what's emerged since he sat down looks a bit less politically attractive.

The largest element of those cuts, or savings, will come in the efficiency drive. That's going up to 3% next year. I'm told that equates to £876m of efficiencies.

That is the big number at the heart of this budget.

Salami sliced

Ministers claim they've surpassed expectations in recent years, when efficiency achievements were recycled within departments.

Now, it seems only councils will be allowed to recycle their savings - as part of their deal with Mr Swinney.

Every other department - including health - will have to get by with the assumption that they're driving their allocations at least 3% harder. Previously, they had a 2% target, and each year you look for savings, they tend to get harder to find.

That answers the question of whether the biggest single-year spending cut, starting next spring, will involve services being axed, or salami-sliced. It looks like thin strips of Italian sausage are on the pre-election menu - £876m-worth of them.

We could have expected housing would take a big hit - it turned out at 19% - because it's so dependent on capital spend, and the capital budget's getting most harshly cut.

Flat screen TVs

Prisons have taken a 22% reduction, despite no sign that prisoner numbers will fall. This suggests they'll be buying fewer televisions for prisoner cells (last week's controversy - apparently flat screens are too good for them). And warders will have less money for rehabilitation.

Somehow, the prison service has to find money for a prison in Grampian, to replace Peterhead and Aberdeen jails. And while it's claimed no spending was expected on that next financial year, where will it come from in subsequent years?

The jail hasn't been included in a list of capital projects to be funded from the revenue budget. While he switched £100m from revenue to capital for next year, the longer-term 'Revenue Financed Investment' programme is one of the more significant new, or reheated, elements in John Swinney's budget.

The idea is a variation on the private finance initiative, but with any profits being recycled. It's a plan that's been a long time coming, but now looks like the only hope for some important projects with a total value of around £2.5bn.

This is how the government intends to fund the Borders railway (around £260m); improvements to the M8, M74 and M73 (£320m); the Aberdeen peripheral road and A90 at Balmedie (c £400m); some school building (£450m); FE colleges in Kilmarnock, Inverness and Glasgow (£300m); and hospital and clinic upgrades (£550m).

The idea is to cap the total amount that will be paid out on revenue funding of new capital projects, at £250m per year, and then to invite private finance to make them happen by coming up with £2.5bn. All this is to be arranged by the Scottish Futures Trust.

Public finance experts don't think anything will happen on any of these projects within at least 18 months. So these projects will have to wait a bit longer than standard procurement - and than some supporters hoped - and will have to pass muster with the bank manager as much as the finance secretary.

Only the select few projects will be directly funded, including the replacement Forth crossing, south Glasgow hospitals and a different category of new schools.

And as for Scottish Water, there's a commitment to ensure it has £700m of capital spend over this and the next four years, but a decision today to cut its allocation from this year's £150m to nothing at all next spring.

Foggy finances

The puzzling bit of the political calculation is how the budget can be portrayed as retaining economic growth at the Scottish government's chief Purpose, with a capital P.

Some of the harsher budgets cuts are for the bits of Scottish government that support the economy most directly; Scottish Enterprise, Highlands and Islands Enterprise, Skills Development Scotland and, most notably, university and college funding.

That looks like one area with a lot of potential to cause the government difficulty, as it is cutting higher education by 7%, along with that 3% efficiency requirement, and it claims to have a promise that this won't lead to a cut in the number of student places.

That, in itself, would be quite some feat in one year. But the problem for universities is that they don't know what, if any, funding stream is going to come from students or, more likely, graduates in future.

That foggy financial outlook compounds the problem faced by the whole of Scotland's devolved public sector, in not having budgets beyond next year. Whether justified or not by the electoral timetable, there's no doubt that makes planning very difficult.

Flexibility, or else

Meanwhile, the pay freeze brings Scotland into line with England, but with some paring back of top-paid public servants thrown in too.

Health gets protected, in a sort of a way. Its budget is only up if you ignore capital, and it's still expected to reach those 3% efficiency targets.

Nicola Sturgeon's department is also having to share £70m with councils, to iron out the transition between hospitals and adult social care, which used to be known as bed-blocking.

Public sector unions knew the pay freeze was coming. They didn't sound like they knew how to react. They also face pressure for "flexibility" in their work practices, which may prove at least as hard to negotiate.

One of the bits that's potentially incendiary is a shake-up of teachers' pay and conditions. Councils want to sort out some of the more expensive consequences of the so-called McCrone settlement from 2001. Easy to say you're going to have a review: rather more difficult to get it past the staffroom.

But to help do so, John Swinney was clear that the prospect of compulsory redundancies is being held in reserve.

It was ruled out for the current parliament, and he says he wants to avoid it in the future. But it's no longer guaranteed, and the tactic seems to be that it will be left to others to decide if it will continue.

Health and efficiency

The language of conditionality we repeatedly heard from the finance secretary extended to that threat to unions: agree to a pay freeze and more flexibility, or else compulsory redundancies are waiting for you.

Likewise to the councils: agree to the government's police number targets and the council tax freeze, or else face more than double the scale of cuts.

It sounded like a series of offers that couldn't be refused.

John Swinney is widely recognised, even by his political rivals, as being much too nice to make much of a mobster.

This latest stage of career will require him to be more of a political conjurer.