Parliament prepares for Annual budget wrangle

Published on Friday 15 January 2010 10:18

This time last year the whole process descended into something close to farce with the presiding SNP Government's spending plans thrown out, only to be approved a week later. But, with money tight, will it be any different this year, asks Ian Swanson

IT'S budget time again at the Scottish Parliament. Finance secretary John Swinney today officially published the Bill setting out the SNP's spending plans for the next financial year.

Talks have already been taking place between ministers and opposition parties on details of Scotland's 29.2 billion budget for 2010-11.

For the past two years, budget negotiations have been all about opposition politicians trying to extract more cash for their priorities in return for helping the minority SNP government get its budget through parliament.

This year, with the recession and the prospect of reduced public spending, the mood is different. The SNP says there is a real terms reduction of 0.9 per cent in next year's budget – partly due to 350 million worth of spending brought forward to this year, and partly down to 500m of cuts from Westminster.

But that is not going to stop the parties pushing their own agendas. Labour – which insists the Scottish Government actually has 1bn more to spend next year – wants the Scottish Government to reinstate the axed Glasgow Airport Rail Link (GARL), provide more apprenticeships and invest more in housing.

The Liberal Democrats are pressing for a pay cut for highly paid public sector bosses, with the money saved being allocated to aid manufacturing industry and fund college places for young people.

The Tories say their main concern is getting the Scottish Government to face up to the reality that future cuts in spending are inevitable. The Greens are once again trying to persuade ministers to go for a free, universal scheme to insulate homes across Scotland.

Independent Lothians MSP Margo MacDonald is arguing for extra funding for Edinburgh to recruit apprentice stonemasons to improve the fabric of the city.

Negotiations begin after next Wednesday's Stage One vote when MSPs are expected to approve the budget in principle. But there is a tight deadline – the final Stage Three vote will take place just two weeks later, on 3 February.

Last year, the talks continued right down to the wire, with the Greens deciding at the last moment that John Swinney had not gone far enough on their demands for a 100m free insulation scheme and voting against the budget. That left the vote tied – and presiding officer Alex Fergusson had to use his casting vote to reject it.

Fresh talks led to the package being passed almost unanimously seven days later.

The SNP says its spending plans will preserve frontline services, with more money for police, health and education. But there is 180m less for housing, 77m less for Scottish Enterprise, cuts in teacher training and support for tourism and a 54 per cent reduction in advertising – and of course the axing of the Glasgow Airport Rail Link.

At the moment the signs are Labour will probably end up voting against the budget. One source says: "We are unlikely to vote for it unless GARL is reinstated. Our theme is jobs, skills and getting the economy back on its feet. GARL is important because there are 1,300 jobs dependent on it."

Labour also wants more apprenticeships – the issue it managed to make some progress with last year – and increased investment in housing.

The Tories, whose votes have been crucial to the Government in each budget vote so far, are exasperated at what they see as the SNP's insistence that Scotland can somehow escape public spending cuts at a time like this.

Scottish Tory leader Annabel Goldie yesterday accused the SNP of living in denial over the inevitability of cuts and labelled Mr Salmond "the King Canute of Scottish politics".

A senior Tory MSP says: "It's reality check time for the Scottish Government. They need to work out how we can continue providing as much as possible of what happens now while spending less.

"We will not take a final decision on the budget until we see the final shape of it. But it's perfectly conceivable we will vote against the budget if they are not facing up to their responsibilities."

The Lib Dems are pressing the Scottish Government to cut "fat cat" salaries in the public sector and believe there is a good chance the SNP will agree to that.

Health secretary Nicola Sturgeon has already bowed to pressure from SNP Lothians MSP Ian McKee and others to call for an end to the multi-million "distinction award" scheme for NHS consultants.

A leading Lib Dem says: "We have worked hard to identify significant savings which could be made in quango and public sector fat cat salaries and we would want that money redirected to help textile and manufacturing industries and to support young people to prevent a new lost generation."

The Greens' top priority is to persuade the SNP to accept the case for a free, universal insulation scheme as a way of tackling fuel poverty and climate change rather than the means-tested grant scheme in selected areas which was introduced instead.

The government promises it will talk to all opposition parties – and Margo MacDonald – but insists it is "premature" to say how it will respond to the competing demands.

It will all depend on the sums – not just the financial calculations, but also the parliamentary arithmetic.