Finance Minister Andy Kerr announced the �70bn in what he called a "budget for growth and opportunity"

The Scottish National Party and Tories accused the minister of misleading parliament over the budget level and the Convention of Scottish Local Authorities (Cosla) said it did not go far enough.

CBI Scotland Director Iain MacMillan said he was happy to see a �3bn increase in overall spending in Scotland over the next three years.

It is certainly not bonanza time and I feel that Scottish local government is still short of where it should be

Pat Watters Cosla

He said: "We welcome what the finance minister had to say. We still have to see the detail, so that is not an unqualified acceptance."

The executive's plan to freeze business rates at their present level for a year was also welcome, Mr MacMillan added.

Bill Speirs, of the STUC, said there was lots of "potential good news" contained in the budget.

He said it was vital to end the two-tier workforce which existed in public services north of the border.

"There is still a lot of detail to be sorted out but it is good to be talking about increases in public spending rather than cuts."

Spending plans

Cosla president Pat Watters said the budget did not go nearly far enough.

He said: "The spending plans outlined by the finance minister barely meet our needs for the services we deliver at the moment and the many new initiatives that have come on stream over the course of the current spending review period.

"It is certainly not bonanza time and I feel that Scottish local government is still short of where it should be."

Friends of the Earth Scotland (FoE) said it was pleased the finance minister mentioned sustainable development during his speech.

But chief executive Kevin Dunion said: "It is still far from clear how these spending commitments will contribute overall to objectives such as tackling climate change emissions or reducing resource use.

"We particularly welcome the new money committed to implementing the National Waste Strategy."