James Kelly also indicated Labour would look at the option of means testing as the party develops the plans it claims will benefit the elderly, carers, those who want to go to college and the unemployed.
Mr Kelly told the BBC that universal services, such as free prescriptions, the council tax freeze and free university tuition had “served Scotland well”, but said that “cuts” to jobs and services meant the party had to “face up to our responsibilities”.
Pressed on whether Glasgow City Council would go back on its manifesto pledge to freeze the council tax for five years, he said councils “need some flexibility around their fundraising options”.
“We will not shirk from a situation where people on six-figure salaries are taking benefits from the system, and we will not shirk from redistributing that to those who need it most,” said Mr Kelly.
Mr Kelly was asked four times if they would consider means testing on the BBC’s Good Morning Scotland programme.
He replied: “We will look at all options, including simplifying the system. These policies have all served Scotland well, but we are facing a situation on the ground where 14,500 council workers lost their jobs last year.
“When people are losing their jobs we have a duty as a party, and we have a duty as MSPs, to look at another way of doing it.”
He added: “The SNP are sticking their heads in the sand. We will face up to our responsibilities and we won’t run away from redistributing areas of the budget to the poor and vulnerable that need it.”
Labour hopes its policy commission will tackle poverty and unemployment by using the money saved from providing expensive “freebie” benefits for the well off to stimulate employment.
But the SNP has attacked the plans, describing the policy review as a “cuts commission”.
The SNP stepped up its attacks when Age Scotland’s Lindsay Scott suggested that Labour’s plans would lead to means-
Mr Scott added: “Means-testing has been proven time and time again not to do what it’s supposed to do.”
Also speaking on Good Morning Scotland, Mr Scott said organisations such as the Institute for Fiscal Studies, the Pensions Policy Institute, the Joseph Rowntree Foundation, had called means-testing “unacceptably complicated, and stigmatising, and expensive.”
The SNP’s Aileen McLeod, a member of Holyrood’s Health Committee, said: “Lindsay Scott’s intervention today highlighted the real dangers threatened by Labour’s cuts commission to free personal care and older people in Scotland.
“He is absolutely right to point out the issues surrounding stigmatisation and bureaucracy, which mean it actually leaves the most vulnerable in a worse position.
A Scottish Labour spokesman said: “In light of Scotland’s looming public spending
crisis, Johann Lamont has signalled her intention to review a number of policies to determine if there is a fairer way to deliver them.
“This fresh and honest approach aims to ensure that hard-working families do not pay the price so that SNP ministers like Nicola Sturgeon with a household income of more than £200,000 can get benefits like free prescriptions.”