Mr Brown announced a mix of funding and cutbacks

Speaking about the impact of his spending plans for Scotland, Gordon Brown said efficiencies would lead to better frontline services.

He said extra money for armed forces would end doubts about defence spending but added that "difficult decisions" about restructuring must still be made.

Some MPs have raised concerns about Scots regiments in a defence shake-up.

Gordon Brown announced that public spending in Scotland would increase by �4.2bn to �25.5bn in 2007/8.

Announcing details of his spending review on Monday, Mr Brown said 20,000 civil service jobs would go in Scotland, Wales, Northern Ireland and England local government, alongside much greater cuts at Whitehall.

Mr Brown said the majority of the cuts outside London would be in the English regions but added that all of these were necessary to improve services.

The decisions about what happens in Scotland are a matter for Scotland Chancellor Gordon Brown

The chancellor said improved services in key areas like health, education and child care were what the public wanted to see.

He said: "If, of course, we can ensure greater efficiency savings as these job reductions do ensure, then of course there will be better financed services at the front line."

The chancellor said information technology improvements and better working practices were leading to efficiencies.

Mr Brown told BBC Radio Scotland that job losses would be offset by a "large numbers of vacancies" in Scotland and assistance for those affected civil servants, including training and relocation.

"I was already able to announce East Kilbride getting 100 jobs from the Department of International Development and there will be more announcements about relocation from the south east," he said.

The chancellor said the unions, which have condemned the cuts announcement, had been consulted about the proposals and stressed that he would "not be diverted from going ahead with these changes".

Defence budget

He also said he had consulted the Scottish Executive about cuts.

Mr Brown said: "Obviously I have talked to (First Minister) Jack McConnell. The decisions about what happens in Scotland are a matter for Scotland.

"When I announced the 20,000 figure for the whole of the United Kingdom, including the devolved administrations, of course much of that is English local government and it's for the Scottish administration to make their own decisions.

"They have said that they want to achieve the same sort of efficiencies that we are achieving in the rest of the United Kingdom."

The executive insisted that while it had embarked on an efficiency drive to save �1bn, it was targeting waste not jobs.

The chancellor announced that the total defence budget would rise by �3.7bn to �33.4bn by 2007/8 - a real terms increase of 1.4%.

However, the Ministry of Defence has been under pressure to make savings and Scots regiments remain under threat.

Mr Brown said: "The uncertainty that has existed until we made this allocation is now removed.

Today as Scotland's regiments are fighting Blair's war in Iraq we need guarantees for their future now that their skills are needed as never before Angus Robertson SNP MP

"The money is now available. There are difficult decisions about restructuring that are to be made for military reasons but equally there is money available for all the priorities of the navy and of course our army and air force."

Details will be made clear in the next few days when Geoff Hoon, the Defence Secretary makes a statement to MPs.

Scottish Labour backbenchers met Armed Forces Minister Adam Ingram in the Commons on Tuesday in an attempt to win assurances over the future of the defence sector.

John Thurso MP, Lib Dem spokesman on Scottish affairs, said: "I welcome the extra money going to the Ministry of Defence.

"However I remain disappointed that the government have not used this opportunity to give us an assurance about the future of the Scottish regiments."

Scottish National Party MP Angus Robertson and Tory MSP Murdo Fraser said a question mark still hung over the future of the regiments in Scotland.

Mr Robertson said: "Today, as Scotland's regiments are fighting Blair's war in Iraq we need guarantees for their future now that their skills are needed as never before."

On the issue of civil service jobs, Mr Robertson said: "Thousands of public sector workers in Scotland have been made to worry about their jobs by Gordon Brown, and since then the Scottish Executive have been running around like headless chickens."

And Mr Fraser believed the spending review was bad news for Scotland's regiments and bad news for Scotland's taxpayers.

He added: "The one thing the chancellor could have done in this spending review was dispel the current fears that Scotland's regiments are going to be cut and amalgamated.