Ivan McKee: How the SNP's budget truly delivers for the many, not the few

SNP MSP Ivan McKee says yesterday's SNP budget will deliver a boost to public sector workers and protect the low paid

YESTERDAY saw the unveiling of Scotland’s Budget in the Scottish Parliament - only the second Holyrood budget since Scotland acquired new, although limited, tax powers. 

And these new powers are being put to good use. There will be a wholesale revamping of income tax bands to create a uniquely Scottish system of taxing income, based on four principles: making tax more progressive, protecting public services, supporting economic growth and protecting the low paid.

The creation of a new Scottish 'starter' rate of tax, 1p lower than the UK basic rate, will be a real help to those just starting on the tax ladder. Keeping the basic rate constant at 20p, adding a new intermediate rate at 21p and increasing the higher and additional rates will ensure those that can pay a bit more do so, and that the increases in tax at the top rates will generate more, not less, cash for public services.

READ MORE: Richard Leonard: The SNP's 'progressive' budget masks an unwillingness to deliver radical change

So, 70 per cent of taxpayers in Scotland will pay less tax than they do now. And more than half of all taxpayers – 55 per cent - will pay less income tax in Scotland than they would in the rest of the UK. This, along with lower council tax charges, makes Scotland the lowest taxed part of the UK. But in a way that benefits the many, not the few.

Remember that Scotland still has only a fraction of the total tax raising powers that an independent country would enjoy. Taxes on savings and dividends income, for example, remain at Westminster, as does corporation tax. 

The ability to implement a wealth tax lies outside of our control, and we have no power over national insurance, fuel tax, VAT or inheritance tax. Together these restrictions severely limit what the Scottish Government can do. It's like trying to play a round of golf with three quarters of the clubs missing.

The budget also delivers for public services, and lifts the public sector pay cap with a three per cent increase for the majority of workers. It must be remembered that Scotland is the only part of the UK to actually deliver on public sector pay. 

Labour-controlled Wales, despite all the bluff and bluster from the party's comrades in Scottish Labour, has failed to lift the cap.

READ MORE: #ScotBudget 2017: What you need to know

Here, a real terms increase in spending has been delivered for public services, and a £400m increase in health service spending is particularly welcome. And when it comes to public services it’s not just a question of how much you spend, it’s also about how well it is spent. 

Scotland’s NHS delivers in a way that those in England and Wales fail to do. Our NHS accident and emergency performance is more than 10 per cent better than in Tory-run NHS England or Labour-run Wales.

The third leg of the budget is the package of measures to drive inclusive economic growth, heeding calls from business organisations to provide the infrastructure and support to help create jobs. There is the £600m investment in superfast broadband roll-out to 100 per cent of Scotland’s homes and businesses, and ensuring that 100,000 small businesses in Scotland pay no rates at all – the best support for small businesses anywhere in the UK. 

And then there's the follow through on the commitment to create a Scottish National Investment Bank, a policy advocated by Common Weal and others. The initial investment of £350m gives real substance to this initiative with its huge potential to drive major investment in Scotland’s infrastructure and economy.

It’s clear that the opposition parties were caught flat footed yesterday. The Tories' economic credibility was further dented. They called for tax cuts for the wealthiest and for more spending in public services, while asking us to ignore the cuts placed on Scotland’s budget by their friends at Westminster.

READ MORE: Highs and lows for Scottish Government budget according to campaign groups

Tory tax plans just don’t add up.

Labour’s plan to put everyone’s tax up by 1p would see the bottom 70 per cent of earners – the people they are supposed to want to protect – paying more than they will under this SNP budget. So Labour find themselves arguing for the poorest to pay more, while at the same time failing to recognise the real terms increases in investment in public services the budget delivers.

As always with Labour, the rhetoric runs away from the reality. When actually in power, in Wales for example, Labour fails to deliver and always disappoints.

The SNP government has used this opportunity to deliver a budget that works for the people of Scotland: tax cuts for those who need them, together with investments in public services and economic growth, paid for by asking those who can afford to pay a bit more to do so.

There is still work to be done to get the budget through the parliament, but what was presented yesterday delivers for Scotland’s public services, for Scotland’s economy and for the vast majority of Scotland’s public sector workers and taxpayers.

Picture courtesy of the SNP

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Peter Dow's picture

Peter Dow

Sat, 12/16/2017 - 11:23

How the SNP's budget actually delivers for the FEW not "the many".

Actually, the SNP budget, by not borrowing nearly enough, delivers Scots' savings to the few, into the hands of the City of London and global bankster class, to fritter away as they please.

Delivering for the many Scots would require a budget that borrowed more, spent more and cut taxes of the many and by more than a mere £20 a year.

Mackay was wrong when he claimed that it was "not possible" to spend more and to tax less.

Oh it is possible, if the Scottish government can BORROW MORE, which it could do with a NEW DEAL fiscal framework instead of the BAD DEAL AUSTERITY FISCAL FRAMEWORK which the SNP government agreed with the UK Tory government in February 2016.

The fiscal framework has dropped off the Holyrood political agenda so that's why Mackay gets away with his ludicrous claim that it is "not possible" to both increase spending and cut taxes simultaneously.

Perhaps it is "not possible" for the SNP to think outside of the box or move from the corner into which they have painted themselves but it would be possible for an intelligent government to demand a new deal fiscal framework, whether in negotiations with the UK or by establishing a new Scottish currency and borrowing from the newly established Scottish central bank.

Peter Dow, Science and Politics http://scot.tk

Peter Dow's picture

Peter Dow

Sat, 12/16/2017 - 11:28

Whilst it is certainly true that the Scottish Parliament and government is also denied many tax powers, I must point out that the SNP has not fought very hard or very effectively to secure more power for Holyrood, tax powers or borrowing powers.

Rather the SNP government has AGREED with restrictions in its powers - such as the SNP government's AGREEMENT with the BAD DEAL AUSTERITY FISCAL FRAMEWORK which Sturgeon signed in February 2016.

So the SNP have no-one to blame but themselves for their timid and craven surrender to the UK as it denies Holyrood the proper governing powers of a real government.

The SNP have no-one to blame but themselves when their own leader, Nicola Sturgeon sings "God Save the Queen" instead of calling for the Queen and the royal family to be banned from Scotland.

The SNP have shamefully settled for the devolution "settlement" with its lack of powers for Holyrood.

I've not settled for devolution. I'm demanding more powers for Holyrood now and for so long as we don't get those powers NOTHING is agreed until EVERYTHING is agreed.

With the SNP everything is agreed because Nicola Sturgeon is allowed to be the Queen's First Minister of Scotland so the fact that the many get little and the few banksters get Scotland's savings is neither here nor there to the SNP.

Peter Dow's picture

Peter Dow

Sat, 12/16/2017 - 12:57

"Derek Mackay, the SNP Finance Minister, admitted there was an “anomaly” with his tax plans, with people earning between £43,525 and £58,500 getting a tax cut next year.

James Kelly, Scottish Labour’s finance spokesman, attacked the “loophole” caused by the higher rate tax threshold increasing. He said: “Derek Mackay’s sham budget is rapidly unravelling .

“The SNP finance secretary has chosen to effectively cut lifeline services by £700million, while giving a tax break to those earning more than double the average salary.”"


Peter Dow's picture

Peter Dow

Sat, 01/13/2018 - 18:27

I also want to reply to Ivan McKee's latest story in the National.
"Investment in young people will grow economy"

The SNP government of First Minister Sturgeon has failed to invest properly in young and older people, stopping all Scots from growing the economy for prosperity for our nation but SNP politicians, like Ivan McKee here, are in denial about the problems and are clueless about the solutions.

Whilst Ivan McKee makes an important point - "We don’t have all the necessary economic levers to grow our economy" - he is in denial about the disgraceful failure of the SNP government which has agreed not to have the necessary economic levers when Sturgeon, on Swinney's advice, foolishly and pathetically signed up to the "lever-less" BAD DEAL AUSTERITY FISCAL FRAMEWORK AGREEMENT with the UK which denies the Scottish government the necessary economic levers, such as the normal borrowing powers of a government.

The SNP Government have neglected the duty of any Scottish government to demand a NEW AND BETTER DEAL FISCAL FRAMEWORK with the power to borrow £ billions a year more interest-free from the central bank, to allow for investment in young and older Scots alike.

Instead of doing their duty, the SNP government have dreamed up a smoke and mirrors scheme to duck their duty and to try to save face. The confidence trick of Sturgeon, Swinney, MacKay and Brown must now be explained and understood. Voters can no longer afford to be fooled by these chancers.

The SNP government have set up the new Scottish Fiscal Commission and appointed someone to run it - the Commander of the British Empire Susan Rice - who they could rely on to excuse their disgusting and treacherous failure to fight for a good deal fiscal framework for Scotland.

("Independent" Ivan McKee calls the Scottish Fiscal Commission. Aye, "independent" just like the "independent" Chief Constable the SNP government appoints to make sure that Scots who dare to oppose their misgovernment by as much as one tweet are under threat of being taken political prisoner, like I have been taken political prisoner by their police on occasion. In other words, not "independent" really but doing what the SNP government wants without putting words in their mouth. Just a nod and wink.)

Instead of fighting for a good deal for Scotland, like cowards, the SNP government appointed Susan Rice to excuse their cowardice in settling for the fiscal crumbs from the UK master's treasury table - which simply goes to show that for the SNP government - saving their political face comes before fighting for the Scots, young or old.

Ivan McKee should be ashamed to be associated with what is in effect a SNP UK-puppet government of Scotland which dares, in effect, to tell us Scots that we are "too wee, too poor and too stupid" to demand a good deal fiscal framework with the normal borrowing powers of any "government" worthy of the name - which Sturgeon's UK-puppet "parcel of rogues in a nation" in Scotland is not worthy.

Peter Dow's picture

Peter Dow

Sat, 01/13/2018 - 18:28

"Investment in young people will grow economy" by Ivan McKee
The National - 13th January 2018

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