The Scottish Government has committed £7 million for a new fund to help tackle poverty in the event of a no-deal Brexit, as price hikes could push 130,000 Scots into financial hardship.

Deputy First Minister John Swinney announced that the Rapid Poverty Mitigation Fund would provide resources to local councils so that “people most in need can get support quickly”.

With the UK due to leave the European Union on October 31, Mr Swinney updated Holyrood on the Scottish Government’s no-deal preparations – saying that ministers were “preparing for the possibility of disorder at sea”.

He also told MSPs plans are in place for a disused ferry port at Stranraer to hold up to 300 HGVs if traffic flows between Scotland and Northern Ireland increase.

He spoke out about the “catastrophic” impact a no-deal Brexit could have, saying the effects on the economy and living standards would be “particularly severe and should not be underestimated”.

With the Brexit deadline now just over three weeks away, the Deputy First Minister warned: “If the UK Government does not correct its current, disastrous course, the UK is at significant risk of crashing out of the EU at the end of this month, and Scotland will be dragged unwillingly with it.”

He hit out at the Tory government’s “complacent and entirely irresponsible attitude towards no-deal”.

Mr Swinney also blasted the “inadequate” engagement from UK ministers – saying a failure to share information had made the Scottish Government’s preparations “unnecessarily difficult”.

He stated: “There is no amount of preparations that could ever make us ready, in any real sense, for the needless and significant impact of a no-deal outcome.”

He warned leaving the EU without a deal in place could “generate a significant economic shock which could tip the Scottish economy into recession”.

Pushing 130,000 people into poverty

The Deputy First Minister added: “If all other factors remain constant, an increase of 5% in prices could push an additional 130,000 people into poverty in a no-deal EU exit.”

With the “possibility of disorder at sea” which could “seriously threaten the safety of marine users”, Mr Swinney said UK ministers must “confirm their capacity to respond to any serious incident”.

A total of 300 Police Scotland public order trained officers are on standby to deal with any “Brexit related civil contingency issues that may arise”, with £17 million finding committed to ensure the police can deal with “EU exit related issues”.

And Mr Swinney went on to detail how ministers in Edinburgh had set up a Scottish Medicines Shortage Response Group, to review risks around shortages or drugs and medical devices.

Ensure supplies of medicines

But he demanded the UK Government put in place plans to ensure supplies of medicines are not disrupted.

Conservatives ministers should also provide “urgent clarification” on future immigration policy, and act to minimise the worst economic impacts of no-deal.

“There is no doubt a no-deal outcome would have profound consequences for jobs, investment and living standards across Scotland and the rest of the UK,” Mr Swinney said.

Conservative MSP Donald Cameron stressed his party was “committed to leaving the EU with a deal as the best way avoid a no-deal exit”.

He said: “We continue to believe that securing a deal is best for protecting our economy and that is where our efforts should be concentrated.”

Labour’s Alex Rowley warned of the “severe and unnecessary harm” a no-deal Brexit would bring, and insisted it would be the Tories who would be responsible for “such grim consequences”.

He said: “It has been utterly disingenuous for Tory MPs and MSPs to tell us they are seeking to agree a deal with the EU when all they have put forward is unworkable solutions.”

The Labour MSP added that the “scale of planning laid out by the Scottish Government today is welcome”.

Businesses to be hit with £15bn customs bill in no-deal Brexit – the same amount paid to EU for membership in 2018