Margaret Curran insisted the policy shift was not a betrayal of Labour’s traditional values, as she accused the Nationalists of trying to shutdown the debate.
Ms Curran, speaking ahead of the party’s UK conference beginning tomorrow, said: “We have to move away from fantasy politics in Scotland. We are constantly told by the SNP Government everything is fine and that’s just not true.
“If we serve our constituents we have a duty to flag up the true costs: 30,000 workers have been lost in the public sector and services are being squeezed constantly.”
Scottish Labour leader Johann Lamont last week called for an end to the “something for nothing” culture, and said taxes will have to rise or services will be cut to maintain popular but expensive SNP pledges on areas such as the council-tax freeze.
As well as putting a question mark on the council tax freeze, Labour may also consider tuition fees for students and an end to universal NHS prescriptions.
The party said no decisions on such policies have been taken but all areas will be looked at, including centrally-imposed targets.
Labour came under attack from its political opponents, with Deputy First Minister Nicola Sturgeon stating that Ms Lamont had become a “poster girl for the Tories”.
Addressing the criticism, Ms Curran said: “That’s a complete misunderstanding of what is being said.”
“Labour has always said we have to be effective guardians of public resources because the money does not belong to us but the people of Scotland.
“We need to deploy those resources effectively and based on the values that they work for all the Scottish people.”