SNP and LibDems on cusp of Budget deal before final talks

The SNP govern as a minority administration and need one party to either abstain or support its plans for Holyrood to pass them. A vote in Parliament is due to take place in February next year.

"We have voted for government budgets before. We did so in 2021 and that was right in the foothills of the Scottish election. We don't hunt as a pack with the other opposition parties just as a wheeze to embarrass the government. We do what is right for our values," Mr Cole-Hamilton told The Herald on Sunday.

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"We move forward in good faith. I don't think our asks are unreasonable. There are areas of great commonality between us and the SNP. On things like the desire to alleviate poverty - we are absolutely in lockstep."

SNP strategists are optimistic too about negotiations with Mr Cole-Hamilton, who has been leading his party's Budget talks with former leader Willie Rennie.

"What Alex Cole-Hamilton has said to The Herald on Sunday is very positive," said one source.

Finance secretary Shona Robison will unveil her tax and spending plans on Wednesday."It's interesting that some people think a deal's been done."

Pressed if a deal had indeed been struck, the strategist said: "We are continuing to talk and as Alex Cole-Hamilton said there is a lot of communality."

It is understood ministers will give the LibDems an update on their Budget plans and on the status of their demands on Tuesday.

Mr Cole-Hamilton said that alongside fighting poverty his party was on agreement over policy around carers. 

Both Sir Ed Davey, the UK LibDem leader, and First Minister John Swinney are carers, the former for his disabled son, John, the latter for his wife Elizabeth, who has MS. Mr Swinney last week received his flu jab to which he is eligible as a carer.

"We are broadly in the same place on things like the carer's benefit," adding that his party had asked the Scottish Government to lift the amount carers can earn before losing entitlement to the carer's allowance," said the Scottish LibDem leader.

UK Liberal Democrat leader Sir Ed Davey (Image: Gareth Fuller) "We have got the carer's allowance devolved to Scotland. This Budget is a great opportunity to say we can increase the amount that carers are allowed to earn before they receive that benefit."

During the General Election campaign Sir Ed spoke movingly about caring for John and for caring for his mother as a child when she fell terminally ill with cancer.

He called for a £20-a-week increase in the value of carer’s allowance from £81.90 to £101.90 and for carers to be allowed to earn up to £183 a week (up from £151) before eligibility for the allowance is withdrawn.

In her Budget, Chancellor Rachel Reeves raised the earnings limit to £196 a week from April in England and Wales without losing entitlement to the allowance and raised the allowance to £83.29 a week from April. In Scotland, the earnings threshold level remains at £151 a week.

In Holyrood, many see the LibDems as the most likely party to strike a deal with the Scottish Government.

The SNP govern as a minority administration and would need one party to either abstain or support its plans for Holyrood to pass them.

Since 2016 the Scottish Greens have backed each of the SNP's budgets but there is some doubt whether they will back it this year.

The ending of the governing pact, the Bute House Agreement, by former First Minister Humza Yousaf in April and the sacking of the party co-leaders Patrick Harvie and Lorna Slater as junior ministers led to considerable tensions between the two pro-independence parties.

There is also said to be hesitancy on the SNP side with some observers telling The Herald on Sunday that there may be some reluctance among some for the party to do a deal with their former allies.

Ahead of the final round of talks on Tuesday, Mr Cole-Hamilton restated his red lines that the Scottish Government should not spend any money on independence or on the National Care Service.

On the first ask, he clarified that his party's demand related to cash or civil service time being spent on "the pursuance of a prospectus for a future independent Scotland and on the mechanics of a second independence referendum".

He also said that he was demanding that the SNP would not take up parliamentary time debating independence.

"There has also been a non-fiscal ask of the government as well," he said.

"We've said to them we [would] take a very dim view if in the next year which this Budget covers that parliamentary time is devoted to rehashing the arguments over the independence question.

"We have so many areas of public policy for government and ministerial attention, warning lights are blinking across the dashboard."

He pointed to the axing of the Minister for Independence, Cumbernauld and Kilsyth MSP Jamie Hepburn (who was moved to he post of Minister for Parliamentary Business in May) and the publication of no further policy papers on independence since John Swinney became First Minister to acknowledge a move in the government direction.

The latest of the Building a New Scotland series of papers, on justice in an independent Scotland, was published on April 25 this year, before Mr Swinney became First Minister. It cost £11,867 to produce.  It is not known if any more papers will be published in this series. 

"I recognise that John Swinney has moved the government on from the white papers, from Jamie Hepburn as Willie Rennie used to call him the Cumbernauld One," he said.

On the government's plans for a National Care Service, Mr Cole-Hamilton restated his red lines that no more money should be spent on the matter.

The government is facing difficulties getting its Bill to set up the service through Holyrood after the Greens last month became the latest opposition party to withdraw support.

"Another poison pill. I think the SNP have lost the dressing room on the National Care Service," he said.

"They have already spent £30 million - the equivalent of 1,200 care worker salaries - on this bureaucratic charade. 

"The Greens conference vote where they withdrew their support for the bill as it currently stands was the final nail in the coffin.

"So I have asked the government to recognise that reality. They can stop spending money on something they know isn't going to get over the line."

Among the LibDems' key budget asks are a "meaningful lift" in council funding and the end of the council tax freeze.

The Herald revealed on Saturday that the freeze would not be re-introduced in 2025/26.

"First we want to see the block grant uplifted in a meaningful way and if it was meaningful enough would allow the council tax freeze to be lifted in any case without having to resort to [councils] hitting people locally in terms of council tax uplift," he said.

"That freeze runs contrary to the respect that should exist between national and central government. It was only there for one year but it came out of nowhere. I think Humza Yousaf didn't even discuss it with his own Cabinet. That's not a way to run a government.

"It rightly put our local government colleagues into apoplexy because they didn't have the flexibility they need. The LibDems are a party of localism and that means trusting our local leaders to make the decisions, whether that is increasing or decreasing council tax based on what is necessary for them. So we wouldn't want to see a council tax freeze."

The LibDems are also seeking more support for both young people and people experiencing mental health issues including more counsellors in schools and cuts to waits for patients seeking diagnosis for conditions relating to neurodiversity diagnosis.

A Scottish Government spokesperson said: “The Scottish Government has a clear mandate to provide the people of Scotland with the information they need to make an informed choice about their future. Decisions on future papers will be taken in due course.”