Mr Swinney spoke after visiting the site of the new Royal Edinburgh Hospital campus today, 16 December.
The £48 million first phase redevelopment involves building inpatient facilities in modern fit-for-purpose buildings.
In addition, a new Robert Ferguson brain injury unit will be created.
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The project is being taken forward in a number of stages over a ten year period, with £120m already set aside for the next phase.
Finance Secretary Swinney said: "I am determined to protect key priorities such as schools, hospitals and police. However, as a consequence of UK Government spending decisions, the Scottish Budget will continue to fall in real terms - as it has done since 2010 - until the end of this decade. That places a significant pressure on the funding of our public services and requires us to continually reform the way in which we deliver those public services.
"Despite these pressures, the Scottish Government will defend and protect the key priorities that the people of Scotland expect us to deliver on. Critical pillars of Scottish life – our schools, hospitals and police – will not be sacrificed to the Chancellor's austerity obsession."
(LM)
