Missed Opportunities and Opposition Confusion on Tax

John O'Groat Journal Colum 19 November 2010


The SNP's flagship plan for a minimum price on alcohol was rejected by Labour LibDems and Tories at the Scottish Parliament. Commentators lashed the opposition and one usually hostile critic Angus MacLeod of The Times newspaper said Nicola Sturgeon’s speech was the best he had heard this year in Parliament.

Her amendment was rejected by 76 votes to 49 proposing the 45p per litre minimum pricing measure. What a sad day for Scotland when party politics took precedence over the very clear consensus among many public health bodies across the UK.

The measure had the support of the medical profession, including all four UK Chief Medical Officers, the BMA, the Royal Colleges of Nursing, Physicians, Surgeons and GPs, the Faculty of Public Health, the British Liver Trust, the Association of Chief Police Officers in Scotland, many publicans and retailers and the World Health Organisation – and there was clear evidence that it would have made a big difference to the huge problem of Scotland’s relationship with drink.

Despite this Unionist parties did not want to see the SNP Government get credit for dealing effectively with chronic alcohol misuse, which has been allowed to get worse while previous governments failed to act.

Previously the smoking ban was supported by all parties as it was a crucial intervention to massively improve health and wellbeing.

Labour and the others have failed to come up with any other proposal to effectively deal with the alcohol problem. They had no real grounds for rejecting minimum pricing – other than party politics.

Yet the cost of alcohol misuse to Scotland's economy and public services in £2.25 billion each year, with 3,000 deaths, 42,000 hospital stays and 110,000 GP visits directly linked to alcohol. At the same time, alcohol is 70% more affordable than in 1980 - and during the same period consumption has increased by around 20%.

The problem is so serious that doing nothing is not an option. They will have to explain to the electorate why they failed to support minimum pricing which had such wide and informed support behind it.

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This week John Swinney, Cabinet Secretary for Finance and Sustainable Growth presented the most challenging budget he has yet had to present, indeed, it is the most challenging budget in the history of devolution.

No-one is under any illusions about the scale of the cuts imposed on us by the UK Government. Two-thirds are the legacy of the previous Labour administration, while the remaining third due to the Tory-Liberal Westminster Government which is cutting too far and too fast.

Their cuts agenda threatens a Scottish economic recovery which, between April and June this year, saw the strongest GDP growth of any major world economy bar Germany, largely driven by the construction sector. But Scotland’s recovery remains fragile.

Therefore, we want to do all in the power to safeguard that recovery, protecting jobs and household incomes across Scotland from the worst impact.

The scale of the challenge we face was made clear last month when Chancellor George Osborne announced his Comprehensive Spending Review, which cuts Scotland’s budget by £1.3 billion next year.

Hard choices are needed, but we can ensure cohesion within our communities by developing a “social contract” with the people of Scotland.

Council tax soared massively under both Labour and the Tories, which is why the SNP took the decision when we came to office in 2007 to freeze it across Scotland. Thanks to our partnership with local councils, that freeze has now been delivered for three years running. It has brought much-needed relief to households in every part of the country.

If that help with household bills was a welcome boost in better times, it has become absolutely essential in the current economic climate.

Labour leader Iain Gray thinks council tax bills should rise, just as people are dealing with pay restraint and rising household bills looming through a rise in VAT.

The SNP disagrees and wants to continue the council tax freeze for the next two years. Also scrapping prescription charges, will make the pay restraint that is necessary fairer and more acceptable which will enable us to protect employment, by maximising the resources available to invest in front line services and economic recovery.

Salaries account for approximately 55 per cent of Scottish Government revenue spending so pay restraint can save nearly £300 million in the budget, as a result protecting some 10,000 jobs in Scotland next year.

In return for an understanding that pay restraint is required, we can relieve pressure that people face with their household bills. Other measures such as reducing senior civil service costs and removing bonuses will also be needed.

Amid the tough choices which this week’s budget outlined, one thing above all is crystal clear, the financial damage inflicted on Scotland by the UK Government means that we literally cannot afford to cede economic control to Westminster. There is no point in having a pocket money parliament when the pocket money runs out.

And the next age of self-government must see Scotland take charge of its own future, with independence and financial responsibility. That way, with the economic powers other nations take for granted, we can take decisions in Scotland, for Scotland, and develop a growth strategy as the only alternative to a decade or more of Westminster-imposed cuts.

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A bright spot last week was the annual Business in the Parliament conference. I invited Gary Reid of Thurso’s award winning bakers to be my guest. We agreed that the networking opportunities were excellent and the debate hugely valuable for businesses across Scotland.



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