LABOUR’S first Budget in 14 years “fails to deliver” the change Scots expected from Keir Starmer, the SNP have said.
Responding to Rachel Reeves’s high-tax, high-spend Budget – which increase taxes by £40 billion – SNP Westminster leader Stephen Flynn said he welcomed higher public spending but warned of the risks of the rising tax burden.
He claimed the SNP were “winning the argument on the need for more investment in our NHS and public services” in response to real terms rises in public spending, which the UK Government said will deliver a record settlement for Holyrood.
And Flynn praised the Chancellor for fudging her “conservative fiscal rules” in the interests of boosting investment.
He added: “However, while additional funding for public services is welcome, the Labour government's Budget also imposes more than £40bn of cuts and tax hikes that will hit millions of Scots in the pocket – and it fails to deliver the transformative change people in Scotland were promised.”
Elsewhere, Reeves (above) also stood firm on cuts to the Winter Fuel Payment and pledged to further Tory welfare policies in a bid to cut social security spending.
Flynn added: “The Chancellor's decision to cut the Winter Fuel Payment will leave around 900,000 Scottish pensioners up to £600 worse off this winter. The decision to keep the two child benefit cap and bedroom tax will push thousands of Scottish children into poverty.
READ MORE: Economists react to the Budget with pay cut fears
“And the decision to raise National Insurance will hit low and middle income workers, and small businesses, the hardest.”
Most challengingly for Labour, the independent Office for Budget Responsibility (OBR) – which checks the working of the Treasury – revised down its economic growth forecasts in response to the Budget.
Economic growth will now not reach 2% after 2025, according to the OBR, but forecasts for the next two years have been upgraded.
Growth will be up in 2024 than was predicted in March, from 0.8% to 1.1% and from 1.9% to 2.0% in 2025, according to the forecaster.
Flynn said the OBR’s revised predictions were “damning” for Labour and he highlighted that the Institute for Fiscal Studies expects that increases to employers’ National Insurance contributions will “hit working people through lower pay”.
He added: “After 14 years of the Tories, this UK Budget should have been the chance to completely turn the page but people in Scotland are still paying the price for Brexit and Westminster cuts, which are wiping billions of pounds from public finances and household incomes.”
The Scottish Greens said the spending rises in the Budget, which will see day-to-day spending up 1.5% and capital investment up 1.7% in real terms, were a "drop in the ocean compared to the scale of the change that is actually needed".
Ross Greer (below), the party's finance spokesperson, slammed Reeves for her "cruel" decision to maintain the two-child benefit cap while scrapping the universal Winter Fuel Payment.
Greer went on: “This timid budget is a drop in the ocean compared to the scale of change that is actually needed. Labour has under-promised and still somehow under-delivered."
The Greens had called for a tax raid on the super wealthy and Greer lamented the decision to spend £3bn on freezing fuel duty to keep the price of petrol down.
Alba's acting leader Kenny MacAskill (below) said Reeves had failed "three key tests": reversing the Winter Fuel Payment cut, saving the Grangemouth oil refinery and a "plan to save North Sea oil and gas jobs".
"Nothing for Scotland’s pensioners, nothing for Grangemouth and nothing for the North Sea. It is now vital that the Scottish Government steps up to the plate and uses any additional funding consequentials it receives to fully mitigate the cut to the Winter Fuel Payment."
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