Final tax plea af ter jobs blow
SOARING numbers of Scots have been thrown onto the unemployment scrap heap, sparking fears that more tax rises in today’s Budget will leave the country ‘staring into the economic abyss’.
An extra 8,000 people claimed jobless benefits north of the Border in the past three months, at the same time as unemployment fell across the UK.
The figures also show the number of people in work slumped by 21,000, sparking renewed fears about Scotland’s economy lagging behind the rest of the UK.
Even SNP ministers admitted the figures were ‘disappointing’ on the eve of the
Budget, while Nicola Sturgeon said she will make ‘tough’ decisions which may be unpopular.
A series of business leaders united yesterday to make a last-ditch plea to ministers to scrap plans to raise tax.
Theresa May also waded into the row, warning that the Budget will be a ‘very real test’ of Miss Sturgeon’s leadership.
The Scottish Conservatives claimed she is ‘losing the trust of the business community’ and has ‘no mandate’ to increase basic rate income tax.
Tory economy spokesman Dean Lockhart said: ‘The fact unemployment rose by 8,000 in Scotland in the last three months should be a stern reminder to the SNP ahead of the Budget.
‘It has been warned extensively about the impact on jobs and growth a hike in income tax will have. If it pushes ahead with these damaging plans, the unemployment rate north of the Border would be at serious risk of increasing even further. Scotland could be left staring into the economic abyss.’
The Office for National Statistics figures show unemployment rose by 8,000, to 114,000 in Scotland from August to October. At the same time, the number of Scots who were in work dropped by 21,000, accounting for almost two-fifths of the 56,000 decrease across the UK.
Asked about the figures, Employability Minister Jamie Hepburn said: ‘These will fluctuate quarter to quarter and it is slightly disappointing that they are slightly down in the last quarter.’
In today’s Budget, Finance Secretary Derek Mackay is expected to increase income tax rates.
Yesterday, the SNP voted against a Tory motion demanding that the income tax rate be frozen for the lifetime of this parliament – despite it being a pledge in its manifesto at last year’s Holyrood election.
Among its options are introducing a 21p tax band for those earning between £24,001 and £44,290, which would affect 898,000 people, as well as increasing rates for those currently earning more than £43,000 and paying the higher or top rate.
Andy Willox, Scottish policy convener for the Federation of Small
‘A very real test of the First Minister’
Businesses, said: ‘The Scottish Government Budget is a key opportunity for ministers to set out their ambitions for the country.
‘A majority of Scottish firms are against changes to income tax, but that doesn’t mean there isn’t action ministers could take to kick-start growth and help firms create jobs.
‘Addressing long-term problems with local roads and pushing plans to deliver universal broadband would be good places to start.’
Liz Cameron, chief executive of the Scottish Chambers of Commerce, said: ‘It is critical any measures on Thursday recognise the existing pressures on household spending and that policies targeted at Scottish business, at minimum, ensure a level footing with the rest of the UK.’
Scottish Retail Consortium direc- tor David Lonsdale said: ‘We would caution against any changes which hit ordinary workers with higher taxes when they are already facing higher inflation and other costs, or which casts a pall over consumer spending.’
At Prime Minister’s Questions yesterday, Mrs May said the decisions on income tax are ‘a very real test of the First Minister and the SNP Government in Scotland’.
At Holyrood, Scottish Tory finance spokesman Murdo Fraser said that ministers have ‘absolutely no mandate to raid the pockets of hard-working families’.
Speaking to business leaders at the Scottish Government’s National Economic Forum in Edinburgh yesterday, Miss Sturgeon made no direct reference to income tax. But she did admit it would be a ‘tough’ budget and that some of the decisions could be unpopular.
The First Minister said: ‘I don’t expect anyone in this room or, indeed, anybody across the country will agree with every single proposal that is unveiled in the Budget tomorrow but I hope when you see the detail, you will agree it does seek to strike the right balance – aimed at making Scotland an even better place to live, study, work and invest.
‘I hope you will be able to see the interests of businesses and the interests of growing the economy have been absolutely central at every stage in our thinking.’
In a statement issued last night, Mr Mackay said: ‘This will be a Budget that is good for taxpayers, good for public services and good for business. It is a Budget that will deliver for Scotland.’
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