First Minister John Swinney will get his budget through parliament after Labour leader Anas Sarwar said his party will abstain.

Mr Swinney yesterday warned of the “damaging” implications of the budget not being passed into law, leading to a breakdown of services and playing into the hands of “populists”.

He described the draft budget as “a platform on which to build a Scotland fit not just for the coming year, but for the coming decades. It is a budget that marks a turning point.”

Mr Sarwar today said the budget was a missed opportunity for real change, but said his party will not vote against it. The parliamentary arithmetic suggests that more than one political party will have to support the Scottish Budget or abstain for it to pass.

“We need a change of direction away from the managed decline,” said Mr Sarwar, adding that he wanted the record settlement for Holyrood to be “gamechanging”.

He said: “We wanted the government to set out a new direction and that is clearly not going to come from this budget.

“As far as this budget goes, John Swinney has the numbers. He has the support of at least one other opposition party, if not directly voting for it, at least abstaining.

“From our perspective we would have voted for the budget if we thought there was a new direction. That’s not coming. As it currently stands we will not vote this budget down. We will abstain. The budget is going to pass anyway.”

Scottish Liberal Democrat leader Alex Cole-Hamilton, said his party’s support “is not guaranteed” but he said the budget had included a number of its demands.

“Labour’s decision confirms once and for all that there will be no early election. This was always very unlikely and that’s why all along Scottish Liberal Democrats have sought to shape the budget to unpick some of the damage caused by years of SNP neglect,” he said.

“You can already see significant Liberal Democrat demands baked into the pages of the budget’s first draft. There is the reinstatement of the Winter Fuel Allowance for pensioners, spending on social care, affordable homes, family carers, additional support needs, GPs, dentists, long covid, the Belford Hospital in Fort William and Edinburgh’s Eye Pavilion.

“There is no deal at present, our support is not guaranteed, but we continue to negotiate with the government and expect more talks in the coming days.”

Green MSP Ross Greer accused Labour of making no attempt to negotiate with the Scottish Government to improve the spending package, in contrast to efforts by the Scottish Greens which have already secured significant funding for climate action, for local services including schools, and for affordable housing.

Comment: Sarwar losing direction amid policy muddle

Other parties were scathing about Mr Sarwar’s position. SNP Finance Secretary Shona Robison said: “Only a few months ago, Anas Sarwar’s Scottish Labour MPs were queuing up to keep the two-child cap in place – yet now he agrees it should be mitigated in Scotland as soon as possible.

“Mr Sarwar has said that Scotland needs change – but he seems to have reflected over the holidays and decided that it is he who needs to change.

“However, people in Scotland will never forgive the Labour party if it does not vote for the reintroduction of a winter fuel payment and the ending of the two-child cap.

“Labour have gone from calling for a new direction to seemingly having no direction.”

Scottish Conservative shadow finance secretary Craig Hoy said: “This is a spineless act from Anas Sarwar who has clearly caved to John Swinney. Labour’s leader is all talk and no action when it comes to standing up to the failing SNP.

“He and his party are part of the cosy left-wing consensus at Holyrood which has repeatedly raised taxes and left our public services and businesses struggling.

“The Scottish Conservatives are the only party who are committed to delivering tax cuts for Scots workers and businesses and giving people more power over their own lives. Meanwhile Labour is happy to be complicit in continuing with the same old approach that has failed Scotland for decades.”

Ahead of the budget on 4 December, rumours swirled around Holyrood of a deal between the SNP and Labour on the back of Mr Swinney’s cordial relationship with Sir Keir Starmer.

A more likely reason for Labour not to oppose the budget is the party’s sharp slide in the polls since the General Election which has made it nervous about forcing an early Holyrood poll. It has managed to surrender all the gains it made just six months ago.

However, Mr Sarwar has continued to pick fights with the First Minister on the health service, housing and education, and will be mindful of further accusations of hypocrisy if he now backed the SNP’s plans.

At the weekend, the SNP said Labour’s refusal to back the budget would be a “betrayal of pensioners and public services.” Daily Business said yesterday that Mr Swinney could expect Labour to abstain.

The LibDems, despite being well-positioned in the polls to gain from an early election, may in the end back the budget or abstain.

In his address at the Playfair Library at Edinburgh University, the First Minister warned of the potentially “damaging” impact of those trying to influence the direction of politics in the UK, his comments directed at the likes of social media owner Elon Musk who has been targeting Sir Keir Starmer.

He said that the best response was to ensure UK politics worked effectively in the interests of the people, and that was why the budget needed to be passed.

“Be in no doubt, if people do not see Scotland’s parliament delivering progress for Scotland’s people – if instead it embarks down a path of political posturing and intransigence – then we run a real risk of feeding the forces of anti-politics and of populism,” he said.

Afterwards, Russell Findlay, the Scottish Conservatives leader, that Swinney’s warning of a populist surge is “just preposterous, absolutely preposterous”. Reform UK’s Scottish spokesman, Martyn Greene, claimed Swinney’s comments were an attempt to deflect blame from the SNP’s years of failed leadership.

The Scottish Retail Consortium offered the government some support by recommending MSPs pass what it calls an ‘imperfect’ Budget. Its director David Lonsdale said: “Whilst the proposed Scottish Budget is far from perfect and has flaws, there is much in it that retailers can get behind.

“Our hope is that Ministers and MSPs can work collegiately to pass the Budget without diluting the pro-growth measures during parliamentary horse-trading. A failure to do so risks adding a thick layer of uncertainty at a challenging time for retail.”

The SRC’s submission to Holyrood’s finance committee is supportive of plans to freeze the basic property rate, rule out income tax increases, drop a surtax on grocers and fund action to combat shoplifting.

Speaking at the Playfair Library, the first in a series of events across Scotland to promote the budget, Mr Swinney said: “Some will pretend there are easy answers. They will offer soundbite solutions – but if we are going to recover and renew as a nation, then we have to come together as a nation. We have to be willing to put in the hard yards.

He pledged to “bring people together and to put in the hard graft to deliver real solutions” adding that “there is nothing wrong in Scotland that can’t be fixed by what is right in Scotland.”

The finance committee at parliament will also resume its scrutiny of the budget on Tuesday by hearing evidence from Audit Scotland, the NHS, Transport Scotland and the Scottish Funding Council.

An initial full parliamentary debate on the budget is due to take place on 4 February and the legislation must receive royal assent by the end of March.

Comment: Sarwar losing direction amid policy muddle