Swinney renews call for halt to austerity
Housing to be big winner amid Chancellor’s cuts
Chancellor George Osborne is expected to outline £20 billion of cuts to public services today when he delivers his Autumn Statement.
While there will be a number of big losers he is said to be planning a £7 billion boost to the housebuilding sector to get more people on the home buying ladder.
Mr Osborne has already announced that £12bn will be cut from the welfare budget but he is under pressure to soften his tax credit plans, probably by delaying or scaling back on the harsher elements in the plan.
He will hope that his plan for “the biggest affordable housebuilding programme since the 1970s” will grab the headlines and the Scottish government will be expected to follow a programme of help for first time buyers.
His overall spending plans have been disrupted by the extra £12bn that has been diverted into the defence budget this week in response to the heightened terror alert.
Some departments, including health, have been ringfenced, but this has put greater pressure on other departments. Among those facing the brunt of cutbacks are local government, the Ministry of Justice and the Home Office, with police forces also looking at reduced budgets.
Carl Emmerson, deputy director of the Institute for Fiscal Studies (IFS), said that because of the amount of protected spending, the unprotected areas could be cut by as much as 50% in the ten year period up to 2020.
John Swinney, the Deputy First Minister renewed calls to the Chancellor to halt the unpopular and damaging programme of austerity and to invest in infrastructure to help the economy in light of slowing growth .
Following a letter to the Chancellor last week, Mr Swinney has raised further concern that Scotland’s block grant will see a real terms reduction to compensate for apparent increases to other departments in the Autumn Statement.
Mr Swinney said:
“The Scottish Government has consistently demonstrated that the UK’s deficit and debt can be brought down without the need for huge public spending cuts as set out by the UK Government. We have set out that the public finances can be returned to a sustainable footing alongside increasing public sector net investment.
“This reveals that the Chancellor is engaged in austerity of choice, not necessity.
“Despite this, the likelihood tomorrow is significant real terms cut to Scotland’s budget – cuts that the IFS claim will be the deepest in history with state spending being at its lowest level since the war. That is the wrong situation to create.
“What is worse is these cuts will hit the poorest the hardest. Low income working households with children are set to lose an average of £1,500 a year if the cut to tax credits goes ahead. A short-sighted move that will have damaging impact to families who already struggle to make ends meet while simultaneously removing work incentives and inhibiting future economic growth
“We will continue to do everything within our power to protect the most vulnerable from the UK Government’s austerity measures, but we want to use our powers and resources to lift people out of poverty not just continually mitigate as best we can.
“In years to come, the additional responsibilities we will get through the Scotland Bill will enable this, and future Scottish Governments, to take a distinctive approach to the challenges we face, to design policies and programmes that align with our vision of a stronger, wealthier and fairer society.
“Our immediate task will be to set out our spending plans on December 16. We will be fair and progressive is our decisions. We only hope – and call on – the Chancellor to take a fair and progressive approach to the Spending Review and end his obsession with needless austerity.”