Government accused of producing 'election budget'
The Scottish Government has been accused of delivering an "election budget" as painful spending decisions were deferred.
- By David Clegg, political reporter
- Published in the Courier : 18.11.10
- Published online : 18.11.10 @ 11.31am
Finance secretary John Swinney confirmed hundreds of thousands of public sector workers would suffer a pay freeze next year, but stopped short of the swingeing cuts some feared.
He said the draft budget for 2011-12 would protect jobs, frontline services and the economic recovery despite the need to find £1.3 billion in savings due to cuts imposed by Westminster.
The North Tayside MSP said flagship commitments to concessionary bus travel, free prescriptions and the proposed new Forth crossing would continue. Councils were also offered a better-than-expected 2.6% budget reduction for signing up to measures including continuing the council tax freeze and maintaining police numbers.
Mr Swinney said, "This is a budget that addresses a financial challenge without precedent since devolution. Despite the biggest reduction in public spending imposed on Scotland by any UK Government, this is a budget that protects jobs, economic recovery and frontline services."
He added, "To address the challenge I have taken steps to reduce the impact of the cuts where possible by ensuring that every pound available to us works as hard as possible."
The pay freeze covers public sector employees earning more than £21,000 a year. It applies to government staff, employees of government agencies and non-departmental bodies. Staff earning under the threshold will receive a minimum increase of £250.
The main savings will come from imposing a 3% public services "efficiency savings" target.
Mr Swinney said publishing longer-term spending levels would make those efficiencies harder to achieve.
But Labour's finance spokesman Andy Kerr said the government had "failed" by not putting forward a three-year spending plan.
He said, "It has put party before nation, self-interest before public interest and the finance secretary's own job before those of the people he is supposed to serve. He is not running a country — he is running an election campaign."
Scottish Lib Dem leader Tavish Scott also accused the government of self-interest, adding, "The budget is aimed at political gain, not at the long-term interests of the Scottish people."
Mr Scott added, "So while some steps are right, much of the real action that needs to be taken to fund services is deferred."
Tory finance spokesman Derek Brownlee welcomed some of the measures, saying, "Conservative policies on extending the council tax freeze, preserving police numbers and protecting jobs through pay restraint are sensible.
"However, unless the SNP's final budget focuses on supporting economic growth and marks the beginning of a longer-term programme of public sector reform, it will fail the tests we have set for our support."
Other main announcements:
► Salaries for new chief executives will be cut by 10% and bonuses will be stamped out.
► £100 million will be shifted into capital spending — hit by a 25% cut from the Treasury.
► Additional funds will be raised through increased business rates on large retail properties such as supermarkets and out-of-town retail parks.
► Health spending will increase by almost £100 million, but there will be cuts in other key areas.
► Spending on justice will drop from £1.4bn to £1.2bn, including a cut of more than £100m for the Scottish Prisons Service, while education and lifelong learning will drop by almost £238m.
► Sport funding rises from £54.1m to £66.4m, primarily due to commitments over the Glasgow Commonwealth Games.
► Housing and regeneration funding falls from £488m to £393.8m.
► Spending under the children, young people and social care heading falls from £96.9m to £95.4m.
► Funds for the Learning Directorate increase from £126m to £156.9m.
► The budget for culture and Gaelic drops from £194.2m to £174.9m, despite a pledge to support the planned V&A in Dundee.
► Historic Scotland — which protects and promotes nationally important sites — will have its budget cut from £49.3 million to £47 million.
► Concessionary fares and bus services will be funded by £255.3m, up from £255.1m.
Scottish Secretary Michael Moore, a UK Government Lib Dem minister, insisted the comprehensive spending review had given Scotland a "fair settlement."
He said, "It is for MSPs to scrutinise the Scottish Government's draft budget so I will leave that to them."
Mr Moore will shortly publish the Scotland Bill, designed to increase Holyrood's responsibility for raising part of its revenue.
The Treasury disputes the Scottish Government figure of £1.3bn of cuts, saying it amounts instead to £900,000 for the coming year, taking the budget from £28.2bn to £27.3bn.
CBI Scotland's David Lonsdale said, "It is very encouraging that Scottish ministers have sought to protect investment in transport infrastructure as much as possible, with welcome announcements on completing the M8 and Aberdeen bypass."
He added, "However, we are deeply concerned about the plans to levy higher business rates on larger retailers. Supermarkets have been one of the few bright spots in the economy over recent years and levying extra rates will hit their investment plans, at a time when they have already been clobbered by the refusal to reintroduce transitional relieve."
Scottish Chambers of Commerce chief executive Liz Cameron said, "There is much to welcome about this draft budget from an economic perspective, but we believe that the Scottish Government has a long way to go if it is to deliver the long-term reform of our public services that we require.
"Transport projects in particular will deliver long-term economic benefits to Scotland and the Scottish Government's continued commitment to this investment, against a background of declining capital budgets, is very welcome indeed."
In agreement with Mr Lonsdale, she added, "Less welcome is the news that large retailers are to face further pain through further increases in business rates. We all want to see our town centres cherished and small, independent enterprises flourish, but the way to do this is through incentivisation — not a further attack on business through non-domestic rates."
Photo courtesy of Stewart Lloyd-Jones.
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