Budget is a test of Scots Tory pledge

Spreadsheet Phil Hammonds Budget could well have a strong Scottish slant thanks to the 13 Scots Tory MPs. Picture: Getty

Faced with uncertain prospects and an unsinkable deficit, and bound by fiscal strictures just tight enough to stop him from doing anything too exciting, “Spreadsheet Phil” Hammond is expected to live up to his billing with a small-c conservative plan for the country’s economy.

Few Conservative MPs are looking forward to it with any enthusiasm, other than Brexiteers who will use it to argue that Eeyore should be led to the glue factory.

One group on the Tory benches do go into tomorrow with high hopes, however. Hammond’s Budget is the first in 20 years to be delivered by a Chancellor with more than one Scottish Conservative MP behind him, and they are keen to make the most of it.

When Ruth Davidson’s party broke two decades of political precedent and sent 13 MPs to Westminster, she promised they would act a bloc and work to get the best deal for Scotland out of the government.

For the voters that sent them, this is the first chance to hold them to that promise and see what’s on offer in exchange for their support. Davidson’s baker’s dozen are quietly confident.

When it’s come to making the case for additional investment in Scotland, they have been as good as their word. Since the election, they have met ministers in the Treasury, Business and Brexit departments as a group, underlining the fact they collectively represent the government’s narrow margin of victory on the closest Commons votes.

After these meetings, a snap has usually appeared on social media of a government minister wedged into a cramped departmental meeting room, outnumbered by Scottish Tories – not an experience they will be used to.

A senior party source says there is a recognition in government that if it wasn’t for Scottish Conservative MPs, Theresa May wouldn’t be Prime Minister, adding that the group have mounted their subtle shows of force “when appropriate”.

Put another way, that means they’ve thrown their weight around anywhere it might knock loose some extra cash. But there is a broader principle they are seeking to establish, too.

Scottish Conservatives want this Budget to change perceptions of what the UK government is for. If it succeeds, it could have a major impact on the constitutional battles that still lie over the horizon.

Senior Tory figures believe that, since devolution, the UK government hasn’t put up enough of a fight to demonstrate its continued relevance. With the spending decisions for most bread-and-butter services now made at Holyrood, there is a feeling that Whitehall hasn’t been forward enough about the areas where it still provides vital investment. The result, it is claimed, is that credit for boosts to departmental spending through the Barnett formula has been claimed by the Scottish ministers that get to spend the extra cash, while the blame for cuts is heaped on the UK government.

Scottish Tories and want to remind their constituents that they have two governments, and that it isn’t just Holyrood that spends the money while Westminster takes it away.

That’s why, at this Budget, the Scottish Conservative MPs have gone looking not just for quick wins that they can attribute their lobbying, but to investment they can plant a Union flag into.

Items on the Scottish Tory wish list are understood to have included additional investment to hurry up the roll-out of high-speed broadband, and support for the offshore oil industry to deal with the costs of decommissioning old infrastructure.

An announcement on VAT payments by Scottish emergency services is widely expected, with a battle already being waged over who gets to claim credit days before the Chancellor gets to his feet.

Police Scotland and the Scottish Fire and Rescue Service have paid up to £140 million over the past four years as a result of losing the VAT exemption for locally-run services when they were merged into national agencies.

UK ministers have previously refused to help fill the gap, saying the Scottish Government was warned about the impact before the mergers. “It’s a problem of the SNP’s own making, but there’s a recognition that it might mean the UK spending some money to fix it,” a Scottish Conservative source says. Now the government is ready to consider extending the VAT exemption after lobbying by Scottish Tory MPs, sparking outrage from the SNP, which has been calling for relief for years.

Either way, if an exemption is delivered, it will make a cameo appearance on election leaflets as £35m a year of Treasury money going directly into Scottish police and fire services.

If the UK government wants to drive home the message that it, too, can deliver investment that transforms the lives of Scottish voters on the same scale as the government at Holyrood, it will need to go further still.

The prospectus for a Borderlands Growth Deal has been put before the Chancellor for approval, listing investment proposals in each of the five local authorities along the Border. Among them is a call to support a scoping exercise for the extension of the Borders Railway, the £350m railway that would trace the route of the old Waverley line from Edinburgh to Carlisle.

Signalling that the UK government is ready to support a new cross-Border railway link would represent as potent a symbol of commitment to economic development as the Queensferry Crossing.

It has taken years to align the interests of councils involved in the Borderlands proposals. Every constituency politician representing the Borderlands deal area at Holyrood and Westminster is now a Conservative. It’s now or never.

If that Chancellor wants to put the contribution of the new Scottish Conservative MPs on the map, there would be no better way of doing it.