Labour unveils its proposals for '˜tax and spend' election

Scottish Labour Leader Kezia Dugdale will speak in Glasgow today. Picture: PA

The Lothians MSP will say the forthcoming May vote is the “tax and spend election” in a keynote speech in Glasgow following last week’s historic deal to devolve new powers to Holyrood.

The Scottish Government’s social justice secretary Alex Neil will tomorrow set out the SNP’s plans to use the Scotland Bill powers to make changes to the welfare system.

Opponents have voiced concerns more generous welfare payments in Scotland could lead to a “benefits stampede”.

Alex Neil will set out the SNPs plans tomorrow. Picture Michael Gillen.

Ms Dugdale will unveil proposals to ensure that children leaving care and going to university receive a full grant, as well as the abolition of the so-called bedroom tax using new powers over Universal Credit.

Labour will also raise the Carer’s Allowance to the same level as Jobseeker’s Allowance and double the Sure Start maternity grant, increasing its value to £1,030.

“Unlike any previous election, it will not be the constitution which is the centre of this Scottish election but rather how we use our powers,” Ms Dugdale will say during a speech in Glasgow. “2016 will be the first Scottish tax and spend election.”

She will add: “Scottish Labour will never look for an excuse not to act. We will use the new powers we hold and grasp with both hands the possibilities they provide.”

Labour had proposed using Holyrood’s powers – introduced this year, through the Calman Commission – to introduce a 1p income tax rise to fund Scottish education in the face of budget cuts, but this was voted down by the SNP government.

The Scotland Bill hands new powers to Holyrood after “the Vow” made by the pro-union party leaders during the independence referendum campaign that Holyrood would be handed an enhanced package of devolution if Scots voted to stay in the UK.

After more than a year of wrangling over the financial arrangements, a deal was struck on the package last week which will see Holyrood get full control over income tax rates and bands.

It will also see a range of benefits devolved, including the Carer’s Allowance, benefits for people with disabilities such as the Disability Living Allowance, Personal Independence Payment and Attendance Allowance, and other benefits which are targeted at low-income households such as maternity grants and funeral payments.

Ms Dugdale will say today that she wants to ensure children leaving care and going into higher education do not just receive the “bare minimum” but a full grant.

The bedroom tax will also be abolished using Holyrood’s new powers over Universal Credit. It is only fully mitigated at the moment, with Scots able to claim a rebate for any impact of the bedroom tax.

The Labour leader will say: “We will also raise the level of Carer’s Allowance to match the level of Jobseeker’s Allowance. This will be worth around £600 a year extra to carers, helping to tackle poverty among a group in society who give so much to others.

“The Sure Start maternity grant was one of Labour’s most effective targeted child poverty measures. It has been set at £500 for 14 years.

“The cost of the grant hasn’t increased, but the cost of having a baby has.

“ We would bring it more up to date by more than doubling it to £1,030, helping families with the average cost of a cot, buggy, car seat and nappies for a year.

“By giving real help to families who need it the most at the beginning of a child’s life, we can work towards making sure every child gets the start in life they deserve.”

Mr Neil said yesterday he aimed to remove the “stigma” of accessing benefits by developing a system that departs from the controversial welfare reforms introduced by the UK government.

A public consultation will be launched on the Scottish Government’s proposals, which will include raising Carer’s Allowance to the same rate as Jobseeker’s Allowance and scrapping the 84-day rule which prevents families with a seriously ill or disabled child from receiving Disability Living Allowance and Carer’s Allowance payments during lengthy hospital stays.

Mr Neil said: “We have the opportunity to take a different approach and develop policies for Scotland which will help to remove the stigma attached to accessing benefits.

“These policies will be based on principles which will ensure people are treated with dignity and respect.

“We want to show that social security can be fairer, tackle inequalities, and protect and support the vulnerable in our society.”

John Lamont, the Scottish Conservative welfare spokesman, said the UK government’s approach is to encourage people off benefits and back into work.

“The SNP are set to undo all the good progress that has been made,” he said.

“What we don’t want to see is a benefits stampede when these new powers come into effect.

“It always pays to be in  work and we shouldn’t be making it easier for those who want to spend a lifetime on benefits.”