£210m of savings identified
Tories say efficiencies could avoid tax rises
Murdo Fraser: tackle inefficient spending
The Scottish Conservatives have identified £210 million in efficiency savings that it says the government could make, rather than raise income tax.
The SNP has introduced a new rate of 21p for those earning between £24,000 and £44,000 and has raised the higher rates to 41p and 46p.
Finance Secretary Derek Mackay insists that the draft Budget proposals will rebalance the tax regime and that anyone earning less than £33,000 will not pay more tax.
Opponents say the overall impact of the Budget will mean Scots workers pay more tax than those in other parts of the UK.
About 1.15m people will pay more than they could by working elsewhere in the the UK, with 800,000 20p basic rate payers now paying the new 21p rate.
Murdo Fraser, the Tories spokesman on finance said: “Our spending analysis clearly shows where the Scottish Government can make substantial savings that could be ploughed back into public services; almost as much as can be raised by raising taxes on hardworking taxpayers.
“The Scottish Conservatives believe that hitting hardworking families with higher taxes will only damage the Scottish economy in the long run, leading to less money to fund public services.
“The Scottish Government should instead seek to tackle areas of inefficient spending or else these inefficiencies will continue to spiral and take up a larger amount of spending in future.
“There is now a serious consensus within Scotland’s business community that the SNP should not increase income tax.
“The SNP must stick to the manifesto; there is no need to raise taxes when there are clear savings to be made.”
Mr Fraser’s comments were made as a think tank says income tax hikes in the Budget have merely deferred deep public spending cuts for a year, and more tax rises may yet be needed.
The Institute for Public Policy Research (IPPR) said the £164m of extra income tax due to be raised in 2018/19 will not avoid tougher decisions in 12 months’ time.
It said: “Serious cuts to public spending remain around the corner.”
Labour has accused the SNP of pulling a ‘con-trick’ on council cuts around the draft budget.
Lifeline local services will effectively be nearly £700 million worse off in the next financial year, it says.
The SNP’s draft budget suggest councils could mitigate these cuts by raising council tax by 3%. However, Labour says Derek Mackay will only raise additional revenue worth £77 million – just over 10% of the £700 million shortfall.
In addition to that, the draft budget provides no additional funding to lift the pay of local government staff.
Labour said the figures showed the need for real change to re-empower and properly fund local government to deliver the services people in Scotland need.
Scottish Labour finance spokesperson James Kelly said: “Derek Mackay is pulling a con-trick on cuts. He has hammered council budgets to the point where there is an effective cut of £700 million next year, and then tells councils to raise taxes to cover the cuts.
“The reality, however, is that these council tax rises would be a drop in the ocean compared to the level of cuts councils are facing.”