SNP and Greens reach budget compromise to increase support for public services


Manifestos cannot set tax policy for whole parliament, Patrick Harvie tells SNP

THE CO-CONVENER of the Scottish Greens hopes that the deal reached on the SNP’s budget can herald a move towards stronger funding and control for local communities.

Patrick Harvie MSP’s agreement with the finance secretary Derek MacKay paves the way for the budget to pass – following weeks of debate and talks on the financial plans.

It’s believed that the parties have compromised on the inflation threshold for income tax payers, an issue that has changed since the May 2016 election with inflation now expected to be higher than before.

Harvie told parliament that MSPs must be flexible to the variety of political changes ahead during the 2016-2021 term, and that it would not be sensible to remain chained to 2016 manifesto details further into the parliament. 

Nicola Sturgeon said it was “legitimate” to recognise rising inflation pressure from the fall in the value of the pound as an issue for budget flexibility. 

“Isn’t it clear that despite this progress we hope to see this afternoon, tax policy with the new powers that are devolved to the Scottish Parliament can no longer be based for the long-term – the duration of a parliament – on manifestos written years in advance. 

“That was the approach in the first era of devolution, when this was just a spending parliament. We now, to some extent, make fiscal policy in Scotland and it’s important to respond the balance of views across the parliament – but also events.

“The events since manifestos were written for last year’s election include the Brexit vote, the fall in the value of the pound, a new UK Government, changes to UK fiscal policy.”

It’s common for Westminster budgets – such as the tax, spend and borrowing direction of the new government – to take a new direction based on political circumstance. 

Last week: Budget stalemate at Holyrood as all five parties’ plans rejected 

The Scottish Government will gain further powers over income tax and air passenger duty in the course of this parliament – on top of the devolved control over the council tax. 

First Minister Nicola Sturgeon, while partly agreeing that tax policy should be flexible, highlighted that the election manifestos were voted on less than a year ago.

“I do agree that any responsible government has to take account of developments and take account of things that are happening in the economy and wider society when it comes to budget decisions,” Sturgeon said.

“I would say though that the manifesto on which this government was elected was not written years ago it was written less that one year ago. And I think it is reasonable for this government to say to the Scottish people that we want to seek to implement the promises that we made to them.”

She added that it was “legitimate” to recognise rising inflation pressure from the fall in the value of the pound as an issue for budget flexibility. 

The Scottish Greens announced that, following budget talks, the party had “secured significant additional funds from the Scottish Government to protect local council services such as schools and social care.”

Finance minister Derek Mackay confirmed: “I’ve reached a deal with Scottish Greens for all stages of the budget to pass. Good news for the economy, taxpayers, communities & public services.”

Picture courtesy of Scottish Parliament TV

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