Chancellor George Osborne has detailed £6.25 billion of public spending cuts across the UK to tackle the record deficit, with Scotland’s share being just over £332 million.
However, the Treasury has agreed the devolved administrations will have the option of making their savings this year or deferring them to the next financial year.
The SNP Government has already made the decision to defer the pain until next year after the Holyrood elections in May which means Scotland may face a “double whammy” of spending cuts at that time.
The devolved administrations in Scotland, Wales and Northern Ireland will have their budgets cut by £704 million in total.
As a direct consequence of the Barnett Formula, Scotland’s annual budget will be cut by £375 million. However, because the UK Government is re-investing £500 million of recycled savings, Scotland will get £42 million back.
On Monday the finance secretary John Swinney defended the SNP administration’s decision not to impose Scotland’s share of the cuts during this financial year.
He said, “The Scottish Government will prioritise economic recovery that is why we are planning to defer these further cuts until the following year, in order that we can entrench economic recovery.
“We are under no illusions about the scale of challenges that lie in the years ahead, and indeed have already published figures which quantify this.
“That’s why we are already delivering better value from our fixed budget in order to maximise investment in economic recovery and the high quality services that people expect and deserve.”SavingsHe added, “Through our efficient government programme we are on track to deliver our target saving of 6% in 2010-11, and have already exceeded the £534 million target for 2008-09 by over £300 million.
“On staffing, we introduced a cap on total staff numbers in post, while we are reducing the number of public bodies by 25% and reducing spending on travel and other operational costs.
“At all times our priority is to make decisions in the best interests of Scotland, and we will do all we can to ensure those interests are reflected in next month’s UK budget and subsequent spending review.”
However, Mr Swinney was accused of putting off cuts for “political reasons.”
Scottish Tory finance spokesman Derek Brownlee said, “We are all in this together and we all have a role to play that includes the Scottish Government.
“The UK Government has managed to come up with efficiencies worth more than £6 billion.
“The Scottish Government has been asked to make savings worth £332 million that is 1p in every pound it spends.
“If the UK Government can make savings, the Scottish Government needs to do the same or explain why it can’t.”
He added, “In the spirit of the new mutual respect agenda, the Conservatives offered the Scottish Government much greater flexibility with its budget and that is now a reality.
“Alex Salmond needs to take this responsibility seriously and either make savings this year or explain why the Scottish Government is unable to do so.””Political reasons”Mr Brownlee said, “The SNP Government cannot make the same mistakes Labour made.
“Gordon Brown refused to make savings ahead of the UK election for political reasons, effectively mortgaging the country’s future to save Labour’s political neck at the ballot box.”
The Scottish Government’s stance came under fire from Professor Alan Alexander, a former chairman of local and public management at the Strathclyde Business School.
He said, “I take a very simple view on this if you have to make cuts, and nobody disagrees that we do, the earlier you start to plan them and do them the more successful they will be.
“The more you can plan the more likely the cuts are to be sustainable.”
He added, “The difficulty of the delay is if you have a shorter time to make the reduction, you are likely to take the ones you can get your hands on and they may not be the right ones to make.”
Scottish Labour finance spokesman Andy Kerr warned of a “double-dip” recession.
He said, “The Tories’ decision to take some £6 billion out of the economy is dangerous.
“By cutting back too early they are putting the economic recovery in danger and exposing us to the risk of a double-dip recession.
“The Scottish Labour Party will oppose Tory cuts and we will oppose SNP cuts.”
He added, “It angers me that while the Tories are reducing support for young people and cutting back on support for business, the SNP are forcing job losses on the NHS.
“Even after today’s announcement, the Scottish Government still has a bigger budget than any of its predecessors, so there is simply no justification for the cuts the SNP are demanding in our schools or hospitals.
“The finance secretary John Swinney’s efforts to pretend that Scotland can somehow remain immune from the effects of a Tory government have no credibility when he is doing their job for them.”
Photos used under Creative Commons licence by Flickr users altogetherfool and The City of Edinburgh Council.