SWINNEY SILENT ON INCOME TAX PLANS

Business chiefs demand clarity on how he plans to raise vital finances

JOHN Swinney gave councils the power to slash business rates yesterday – but refused to come clean on his own income tax plans.

The Finance Secretary followed George Osborne’s lead in devolving £2.8billion worth of rates to local authorities.

That was welcomed by business leaders but they demanded clarity on income tax.

Mr Swinney’s 2016 budget will be the first to include a Scottish Rate of Income Tax. The rate of each band will be raised or cut by the same amount.

Business leaders and Scots Tories have urged him to rule out a hike that would leave Scotland at a competitive disadvantage with the rest of the UK but he has so far refused.

In yesterday’s speech to conference he talked about the economy and jobs at length. He urged voters to give the SNP five more years in power but failed to mention income tax once.

Hugh Aitken, Scotland director of the Confederation of British Industry, said: ‘CBI has been calling for the next Scottish Government to ensure our business rates remain competitive and help deliver economic growth.

‘More broadly, the next Holyrood government will need to set out an overall tax roadmap to provide certainty to businesses’ long-term planning and strengthen the economy.’

With the Scottish economy flagging, local authorities will have the power to cut business rates to give local companies a boost within months, following yesterday’s announcement.

Mr Swinney said: ‘The Scottish Government is committed to giving communities real control over their own futures. This substantial new

‘Sole aim has been independence’

power will give councils more control over business rates, and an opportunity to tailor them to their local area.’

Colin Borland, of the Federation of Small Businesses (FSB), said: ‘If used appropriately, these powers could give local economies a welcome boost and it will be interesting to see how many hard-pressed councils will be able to take advantage of them.’

However, the Scottish Tories warned that Mr Swinney’s repeated criticisms of the UK Government would start to ring hollow if he keeps stealing the Chancellor’s policies.

Alex Johnstone MSP, said: ‘For years now, the SNP have been mismanaging millions of pounds of funding. That’s money which could have gone on all kinds of local services.

‘Their sole aim has been independence, while communities across Scotland have been losing out on vital public services.

‘At the recent Conservative Party conference, we announced English authorities would be allowed to keep rates totalling £26billion, so John Swinney was obviously taking notes.

‘If the Nationalists are swotting up on Conservative economic policy, then it really does prove how George Osborne’s measures are helping to get Britain’s economic recovery back on track.’

Meanwhile, Mr Swinney’s attempt to exert a calm authority over Scotland’s troubled economy was derailed by his party’s own UK Treasury spokesman, in a car crash TV interview.

Stewart Hosie was repeatedly asked how the SNP would have plugged a £7.5billion black hole in an independent Scotland’s budget. It predicted £8billion North Sea tax revenues in 2016-17, but has since revised them down to just £500million.

And he also struggled to explain why the SNP Government had increased health spending by only £300million over its last seven years in power.

In both cases Mr Hosie tried to blame the UK Government.

He told the Daily Politics: ‘ Given that we have a Government subject to extraordinary cuts from Westminster, that we have been able to protect the NHS and deliver real terms increases every year is a remarkable achievement. That is something we should be proud of.’

Presenter Andrew Neil, who laughed with incredulity at the response, demanded to know why he was proud when England had seen a 12 per cent increase in five years, compared to 8 per cent in Scotland.

It is the second consecutive day that oil figures and health spending have cast a cloud over the SNP conference.

Mr Swinney has been forced to defend his record of eight years in charge of the country’s finances in the face of dismal job statistics, with unemployment up 18,000 in the past three months and growth almost stalled as the rest of the UK continues apace.

Despite a positive gloss on his speech to conference, he could not hide the growing list of problems at the heart of the economy, and begged voters to give the SNP another five years to put them right.

Mr Swinney said: ‘ Output and employment are back above their pre-recession peak but challenges remain in our labour market including underemployment, low productivity, stagnant real wages and the recent rise in unemployment demonstrates the importance of sustaining public investment.

‘At the election in May, people can entrust these challenges to the SNP, or they can gamble with the untried, untested and divided Labour Party.’

The weakness of the SNP’s economic argument has been widely blamed for its referendum loss last year and opposition parties will again attack its record in next year’s Scottish elections.

Jackie Baillie, Scottish Labour public services spokesman, said: ‘The SNP’s record in government isn’t one to be proud of.

‘Council budgets have been slashed by £750million, there are 4,000 fewer teachers and the number of people working in local government has fallen by nearly 29,000 on the SNP Government’s watch.’