Labour in call for new Scottish fiscal body

Jackie Baillie accused the SNP of 'cooking the books' on oil forecasts during the independence referendum campaign. Picture: Julie Bull

The party wants a Scottish Office for Budget Responsibility (OBR) to be established in advance of the devolution of new tax powers recommended by the Smith Commission.

Making the case for a new body, shadow finance secretary Jackie Baillie accused the SNP of “cooking the books” on oil forecasts during the independence referendum campaign.

The Scottish Government dismissed the call as “ill-informed”.

Ms Baillie said: “Taking responsibility for giving Scots an honest assessment of the public finances away from ministers and putting it into the hands of experts free of political manipulation is the right thing to do for Scotland.

“With the major new powers coming to Scotland, the government in Edinburgh will be responsible for collecting much of the taxes Scots pay.

“We need to know there is a watchdog holding ministers to account.”

Ms Baillie said she wanted a Scottish OBR to scrutinise the manifestos of all the political parties at the Scottish Parliament.

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She added: “The way the SNP cooked the books on oil during the referendum proved they can’t be trusted to be honest with the Scottish people about the public finances. Scots were misled on oil by the SNP and it must never happen again.”

Economist Dr Angus Armstrong, of the National Institute of Economic and Social Research, welcomed the proposal.

He is currently bidding to become Labour candidate in Alistair Darling’s Edinburgh South-West seat at the general election.

Dr Armstrong said: “A Scottish OBR will restore the public’s confidence in government forecasts and government accounts because it puts them beyond the control of politicians. The new powers being delivered to Scotland through the Smith Agreement demand this.”

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A spokesman for Finance Secretary John Swinney said: “Ms Baillie seems completely unaware that Labour supported our establishment of the Scottish Fiscal Commission, and indeed, our Programme for Government makes clear our intention to put the commission on a statutory footing, proposing that its remit expand to reflect any new fiscal powers devolved to the Scottish Parliament.

“But frankly, it takes some brass neck for a Labour politician to accuse others of making over-optimistic fiscal forecasts. In just six years, Gordon Brown managed to get his borrowing predictions wrong by over £400 billion - and of course, during Labour’s time in office national debt almost trebled. In contrast the SNP Government has balanced the budget every year.

“Meanwhile, the oil price assumptions used by the Scottish Government were consistent with industry (and global) predictions and were indeed lower than those predicted by UK Department of Energy and Climate Change (DECC).

“Jackie Baillie’s time would be better spent backing Scottish Government and industry calls for immediate fiscal changes from the UK Government to support the oil industry - something which Labour have so far failed to do.”

The Conservatives have proposed that no tax be levied on house sales under £140,000, and that the 10 per cent tax on homes between £250,000 and £500,000 be halved.

Finance spokesman Gavin Brown MSP said: “The eye-watering 10 per cent tax rate has caused concern in many parts of Scotland and is having a distortion on the housing market.

“There is a clear and obvious way to fix this distortion - the Scottish Government can use the windfall from UK stamp duty changes to create more realistic tax rates with a shallower increase.

“The Scottish Conservatives believe a 5 per cent rate should replace the 10 per cent rate, as well as an increase in the starting threshold.

“Our proposal would help those who aspire to own a family home and create a housing market that functions more smoothly.

“This can be done because the overall size of the tax being devolved is smaller. We have called for the changes to be announced as soon as possible, to provide certainty to people trying to buy and sell their homes.”

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