Scottish Budget: Can SNP spike Labour's guns?

Well, it hasn’t worked. Labour are unruffled and the SNP are under attack from all sides. The approaching general election won’t be about the two parties’ socialist credentials in any case, but hope versus disappointment, and the SNP are on the wrong side. They have outflanked Labour on the left with their tax plans, but trust in the SNP is draining away and that’s a far bigger issue.

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In other years, the finance minister Shona Robison might have sat down from giving her budget statement with a smug smile, directed at Labour. A council tax freeze billed as helping out hard-pressed householders, an increase in the top rate of income tax and a whole new tax band for wealthy suburbanites, are policies to warm socialist hearts.

Had she been smirking across the chamber at the Corbynite former Scottish Labour leader Richard Leonard, a die-hard class warrior, then it would have been one-nil to the SNP. In those days, which weren’t so very long ago really, the SNP were still the mighty monarchs of Scotland and Labour looked like mice in their shadow.

But we all know what must eventually happen to the mighty. It’s a different story today. Ms Robison has indeed thrown down the gauntlet to Labour, this time to finance spokesman Michael Marra, but Mr Marra has casually kicked it aside.

It’s not fair, really, since the SNP have a good case against Labour, on paper. Doing the broadcast round following the budget announcement, Mr Marra admitted he supported the council tax freeze, though claimed that Labour would have funded it better. He supported the Scottish Child Payment, which has gone up.

He dismissed the Scottish Government’s claim that a cut to the Westminster block grant had driving down spending, even though Welsh Labour in its budget this week said the same thing. He dismissed the SNP’s tax increases on the higher paid even though his own party called for a tax increase on incomes over £100,000 two years ago.

Labour's Michael Marra (Image: free)

He attacked cuts to services but refused to say what he would have cut in the same circumstances. On tax in particular, Scottish Labour is at odds with a coalition of anti-poverty groups and unions who support the new tax band, with some wanting to see it imposed on incomes over £58,285. To this extent, the SNP did emerge from the bout looking more faithful to its progressive principles than Labour.

But in spite of it all, Michael Marra sounded confident. He knows this won’t change the political weather, which is pelting the SNP.

A recurrent charge against the Scottish Government is that the SNP are the Hermes of politics: they don’t always deliver when they say they will. This budget won’t change that view.

Housing is to lose around £200m from its budget in spite of commitments by ministers to tackle homelessness and deliver 110,000 affordable homes by 2032. The Scottish Child Payment increases to £26.70, but not to £30 as Humza Yousaf promised in the spring. The transport budget is slashed, leaving questions marks over various promised improvements. Funding for the Just Transition has been cut by 75 per cent this year, in spite of high profile promises to ensure a future for oil and gas workers.

Labour’s position sounds informed more by realism than ideology, which may do it no harm with voters. Raising taxes on those earning more than £75,000 looks good on paper but will the rather small tax take outweigh the risks? Labour highlights Scotland’s chronic shortage of NHS consultants, arguing higher tax will make it harder to attract them in competition with other UK nations. Awkward, but probably true. It’s also true that middle earners on £30-£50,000 are affected by the cost-of-living crisis, yet taxes on them are now significantly higher than in England and Wales.

This leads on to what is perhaps the SNP’s biggest headache going into election year: that to compensate for higher taxes, people in Scotland have to get something in return and they don’t all feel that they do. Both taxes and spending-per-head in Scotland are higher than in England already, but it’s questionable whether the quality of services here reflects that.

Voters may well support the use of their tax pounds to fight child poverty, pay nurses properly and achieve ambitious climate goals, but that won’t stop them feeling cash-strapped and worried. It won’t stop them wondering why all that extra spending has not resulted in better attainment in schools or lower waiting lists in hospitals.

And the council tax freeze is just the wrong priority. As many have noted, including the left-leaning Institute for Public Policy Research (IPPR), a council tax freeze is regressive, since it saves more money for higher earners than for the worst off.

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The Scottish Government says it supports people hammered by inflation, but those people won’t be much impressed if, come March, their local councils have to cut yet more services. We have “fully funded” the freeze, insists Ms Robison, but this is a tad disingenuous when she knows some councils were expecting to raise more from council tax than she’s budgeted for. Some of the money spent on the freeze could have funded that extra £5 on the Scottish Child Payment, helping keep Scotland’s plans to cut child poverty on track.

Meanwhile, on the other side of all this, the SNP is attacked by business groups and the Conservatives for that extra tax band and low economic growth.

Scottish ministers have been operating in a punishing situation. Labour in their shoes would have struggled to make substantially better choices.

But amid the general discontent, who will remember that come polling day?