By Keith Aitken in Edinburgh | 11 September 2013
Finance Secretary John Swinney promised to focus on mitigating the social effects of Westminster cuts and investing in Scottish economic growth over the next two years, as he presented his draft Budget to the Scottish Parliament.
Setting out his draft Budget for 2014/15 and spending plans for 2015/16, Swinney promised to protect NHS and council budgets while also maintaining the country’s council tax freeze.
He also said that the Scottish government would fund an annually upgraded living wage for the lowest-paid public sector workers, and would also reject UK plans to curb pay progression in the public sector.
Around £120m would also be provided in 2015/16 to fund the integration of health and social care services. Personal care and concessionary bus fares for the elderly, prescription medications, and access to higher education would also all remain free for Scottish residents.
Swinney also promised to find at least £68m in each of the next two years to mitigate the harshest impacts of UK benefits cuts, including a continuation of the £33m annual Scottish Welfare Fund intended to offset cuts to housing benefits.
He also announced an additional £20m this year to mitigate the effects of the so-called bedroom tax, a measure an independent Scotland would reverse, he said.
Swinney said the plans came despite Westminster-ordained real terms cuts of 11% the Scottish budget over five years, and a 26% reduction in allocations for capital spending.
He told MSPs he has been able to shift some resource from current spending to capital projects, and that his plans had been boosted by an underspend on schemes funded through the non-profit distributing delivery model.
Chief among these was a £145m saving on the original estimates for the cost of the new Forth road bridge. This was helping to fund a £1.35bn programme of affordable housing construction across four years, some £8bn of infrastructure investment over the next two years, and a £24m national sports centre to uphold the Commonwealth Games legacy.
Swinney said Scotland had recently outperformed the rest of the UK in GDP and employment growth over the last year. ‘With the full fiscal and economic powers of independence the Scottish government could do yet more to strengthen our economy and create more jobs,’ he claimed. ‘This Budget makes clear the benefits of decisions being made in Scotland by those who care most about its future.’
The package, the last ahead of next September’s referendum, had been trailed as a ‘Budget for Independence’, but Swinney was accused by opposition MSPs of putting political priorities above the needs of the Scottish economy.
His Labour shadow, Iain Gray, said the funding provided was only half what was needed to offset the bedroom tax. He urged Swinney to ‘take this Budget for independence away and bring back a real Budget for jobs, a Budget that banishes the bedroom tax from Scotland this year, next year and the year after’.
Gavin Brown of the Conservatives accused Swinney of robbing business to pay for his giveaways, by raising business rates, imposing a retail levy and penalising empty properties, while the Liberal Democrats’ Willie Rennie said the Budget was the wrong response to the increase in unemployment.
