Budget must ‘immediately and significantly’ increase cash for Scotland – Swinney

Rachel Reeves will lay out the UK Government’s tax and spending plans on Wednesday, where she is expected to make “difficult decisions on spending, on welfare and taxation” and change the way national debt is measured to give her more flexibility to borrow.

Ahead of the Budget – the first for a Labour Government since 2010 – Mr Swinney pushed the Chancellor to boost cash for Scotland.

Speaking to business leaders at a reception on Tuesday, Mr Swinney said: “The Office for Budget Responsibility highlighted recently the potential for public investment to deliver permanent improvements in the economy.

“It is welcome that my calls for the Chancellor to amend her fiscal rules have been heard, with indications last week that there will be scope for greater investment.

“The Chancellor has the chance to choose to deliver a UK Budget that invests in our public services and supports the entrepreneurial spirit displayed in Scotland’s business sector.

“With these new rules in place, the Chancellor must use the fiscal headroom they create to deliver a Budget that immediately and significantly enhances Scotland’s resource and capital funding, enabling us to invest more in our public services and take forward the vital infrastructure projects that support economic growth, net zero, and action to tackle child poverty.”

The Scottish Government has been candid about its dire financial straits in recent months, with Finance Secretary Shona Robison forced to make more than £500 million of in-year cuts.

Mr Swinney also pushed for funding for the Acorn carbon capture and storage facility in the north east of Scotland, which has been overlooked twice by successive UK governments.

The facility would “provide new opportunities for workers in the oil and gas sector in Grangemouth and in other parts of Scotland”, the First Minister said.

Meanwhile, Scottish Chambers of Commerce chief executive Liz Cameron warned the Budget will have a direct impact on business confidence.

“Our Budget focus is on growth, investment and competitiveness. That means investing in skills, technology and infrastructure, and equipping the workforce for tomorrow’s challenges,” she said.

“The Chancellor’s actions and the message they send will directly impact business confidence and investment at a time when we need to create positive momentum. We hope that our calls to support business have been listened to and not ignored.”

The Scottish Conservatives, meanwhile, warned of the potential for a “tax double whammy” if the UK Government increases levies on Wednesday and the Scottish Government follows suit in December.

Reports have suggested the Chancellor could increase national insurance contributions on employers, capital gains tax and fuel duty, while also freezing income tax bands.

Scottish Tory finance spokesman Craig Hoy said Ms Reeves’s Budget will condemn hard-working Scots to a tax double whammy, as Labour join the SNP Government in clobbering them.

“Keir Starmer is shamelessly breaking his pre-election promises, with a host of punishing tax rises which have already been leaked to the media.

“The damage caused by Labour’s eye-watering tax rises will be felt worse by Scots, because we’re already the highest taxed part of the UK thanks to years of SNP misrule.

“These left-wing parties wrongly believe that constantly raising taxes is the solution to everything. It’s not – and it’s putting intolerable strain on household budgets and stifling economic growth.”

But Scottish Labour finance spokesman Michael Marra insisted the Budget will “end the era of austerity and put growth front and centre”.

He added: “Labour is fixing the fundamentals across the UK, but we need an end to the economic and financial mismanagement of the SNP too,” and he urged the Scottish Government not to “squander the opportunities” the Budget will create.