John Swinney warns Chancellor's spending cuts poised to be 'very damaging' for Scotland's NHS

John Swinney has warned Scotland's NHS faces being starved of funding from Westminster as Rachel Reeves is poised to wield the axe on government departments and "target" vulnerable groups in her spring statement.

Mr Swinney has warned that the Chancellor’s spring statement on Wednesday threatens the day-to-day spending of the Scottish Government and public services including the NHS.

Prime Minister Sir Keir Starmer and First Minister John Swinney | PA

On Sunday, Ms Reeves confirmed she will be asking government departments to cut up to 15 per cent from their budgets, alongside controversial cuts to disability benefits.

Mr Swinney, who has been deeply critical of Ms Reeves and the Labour UK government’s economic strategy that he has branded a continuation of austerity under the Conservatives, has now warned the blueprint risks putting day-to-day funding for frontline services in Scotland under financial pressure.

Read more: Why John Swinney is feeling especially confident as he insists the SNP is 'back in business'

Although many Whitehall departments are reserved to the UK government, cuts to funding are likely to have a knock-on impact on Holyrood’s budgets through the Barnett formula.

Mr Swinney said: “I think the Chancellor’s statement has got two principal worries for Scotland within it.

“The first is that some of the most vulnerable in our society are going to be targeted by a Labour government. I can hardly believe that a Labour government is actually taking more damaging decisions than even the reckless Conservative government took in relation to people with vulnerability in our society.

Chancellor Rachel Reeves. (Photo by Yui Mok-WPA Pool/Getty Images)

“The second thing is that I suspect the mismanagement of our economy by a Labour government is going to result in spending cuts that are going to have a damaging effect on Scotland.

“That will not help us to eradicate child poverty, it will not help us to improve our public services particularly the NHS. All of that is happening at the hands of a Labour government.”

He clarified that the concern was “day-to-day spending”, with Ms Reeves set to demand cuts of up to 15 per cent from government departments.

Mr Swinney said: “If I look at the rhetoric and if that gets turned into reality, then it starts to impact resources that become available for day-to-day expenditure and that would be very damaging indeed.”

Read more: SNP set for benefits spending collision with Labour to rescue poverty targets

The SNP has used some the Chancellor’s unpopular decisions to attack Labour at Holyrood over recent months - putting the party’s Scottish leader, Anas Sarwar, under pressure for his assurances during the election that Sir Keir Starmer’s government would not continue austerity policies brought forward by the Conservatives.

Mr Swinney told journalists that Mr Sarwar’s austerity comments amounted to “a reckless commitment”.

The First Minister also warned that economic growth across the UK would “plummet” due to Labour’s hike to employers’ national insurance, which he described as a “body blow” to business.

He said the rise in national insurance announced in Ms Reeves’ first Budget last year was “deeply worrying”.

Mr Swinney said: “It hasn’t even been implemented yet and, believe you me, once that gets implemented the growth ambitions of the UK government are going to plummet because it’s a body blow for business and the economy.

“The last decision the Chancellor should have taken was to take that decision – it’s not an illustration of very good decisions.”

Meanwhile, a Downing Street spokesman said on Monday that Sir Keir and President Donald Trump spoke on Sunday night about progress on an economic deal between the UK and the US, amd reports a tax on tech giants could be slashed.

Reports have suggested Britain could slash the digital services tax - a levy on big tech companies - in order to stave off American tariffs.

The Prime Minister's spokesman would not be drawn on whether slashing the digital services tax in exchange for a reprieve on American tariffs was part of Sir Keir's discussions with Mr Trump, and insisted the Government would only strike a deal "in the national interest".

Asked whether digital services tax would be scrapped, Sir Keir’s spokesman told reporters: "Firstly, just taking a step back, the UK is working with the United States on an economic prosperity deal, building on our shared strength of that commitment to economic security.

"As part of those discussions, the Prime Minister and President Trump discussed progress made in those discussions last night.

"The UK will only do a deal in the national interest, which reflects this Government's mandate to deliver economic stability for British people."

Ms Reeves, meanwhile, described the 2 per cent tax on social media companies, search engines and digital marketplaces as "hugely important", adding that it brings in around £800 million a year.

The Chancellor also appeared to signal that cutting free school meals for younger pupils in England would not be among the cost-saving measures she will implement, as some media reports suggested.