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Miliband tackles SNP fiscal stance

Published 10/04/2015

Ed Miliband will seek to woo Scottish voters
Ed Miliband will seek to woo Scottish voters

Ed Miliband will today insist he would "never sell Scotland short" by backing SNP plans to make Holyrood responsible for raising enough funds to cover all its spending.

The Labour leader will use a visit to Edinburgh this morning to attack Nicola Sturgeon over her party's support for full fiscal autonomy - claiming this would leave a £7.6 billion "hole" in Scotland's finances.

Jim Murphy, the Scottish Labour leader, has already pressed the SNP leader and Scottish Minister on the issue in TV debates this week, claiming she made a "stupid strategic error" when she said nationalist MPs at Westminster could vote for full fiscal autonomy for Scotland as early as next year.

Such a change to the way Scotland is funded would mean the country no longer receives a block grant from Westminster, and would instead have to raise sufficient resources to cover all its public spending.

With Labour facing a battle to retain many of its seats in Scotland in the wake of surging SNP support, Mr Miliband, Mr Murphy and Labour's shadow chancellor Ed Balls will today mount a joint attack.

The UK Labour leader will tell voters in Scotland the choice they face on May 7 is " between a Tory Party that only wants to help those at the top, a £7.6 billion funding gap from the SNP, which will hit working people hard, or a Labour party that knows Britain will only succeed if working people succeed".

Mr Miliband will argue introducing full fiscal autonomy would mean an end to the Barnett formula, which is used to distribute cash across the UK, and which ensures "Scotland's public services are properly funded".

He will claim: "Fiscal autonomy will mean a £7.6 billion hole in Scotland's finances.

"A £7.6 billion gap that would need to be filled with more taxes on working people or more borrowing."

The Labour leader will add: " You can't build social justice with a £7.6 billion funding gap because the burdens of it would fall on working families across Scotland."

Changing the way Scotland is funded would also mean an end to the policy " pooling and sharing across the UK", Mr Miliband will state.

"It means the benefits of Labour policies, like the mansion tax for the NHS and the bank bonus tax to pay for jobs for our young people won't be felt in Scotland."

He will tell Scots: " This strikes to the very heart of what I believe in. I will never sell Scotland short by signing up to the SNP's plans."

But SNP depute leader Stewart Hosie claimed Labour, like the Conservatives " are proposing more cuts, and defending Westminster controlling over 70% of Scotland's revenues and 85% of the welfare spending in Scotland" at the same time as people north of the border want "extensive new powers" for Holyrood.

He argued: " The whole purpose of financial autonomy is having control of our employment, taxes and spending to growing our economy instead of facing Tory and Labour cuts.

"Scotland's economy is strong - by 2020 our onshore revenues will grow by £15 billion - and with more powers we could achieve more

"The UK deficit was £98 billion last year and over the five years to 2013-14, the UK's cumulative deficit has been worth over £600 billion. In two of the last four years, Scotland's deficit has been less than the UK's, and in each of the last 34 years Scotland has paid more tax per person than the rest of the UK."

Mr Hosie added: " Labour's referendum alliance with the Tories is clearly still in operation. And now that Labour have admitted they are planning to cut spending, Ed Miliband and Jim Murphy need to come clean and tell the public exactly what they are planning on cutting."

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