Spending study adds weight to Labour-SNP coalition theory
Analysis finds few differences between parties’ plans
THE SNP’s plan to cut Britain’s deficit is not radically different from Labour’s, the head of a leading think-tank has claimed, in an analysis that will fuel speculation about a possible pact between the parties.
Paul Johnson, director of the Institute for Fiscal Studies, said there was “not a huge amount of difference” between their spending plans over the course of the next parliament.
He said the relatively small gap between the two parties contrasted with a “substantial” gulf between L ab ou r and C on s er v at i ve proposals.
His comments undermine Nicola Sturgeon’s claim to be challenging a “cosy consensus” between Labour and the Tories on how to reduce Britain’s £90 billion deficit after the General Election.
However, they will add fuel to the ongoing speculation about a possible post-election deal between Labour and the Nationalists.
The SNP has called for modest spending increases to “end austerity”.
Ms Sturgeon has said Labour would have to be “more moderate” in its approach to cutting the deficit if her party were to offer any support to an Ed Miliband government.
Mr Johnson addressed a David Hume Institute seminar in Edin- burgh last night. Speaking earlier, he said: “There is not a huge amount of difference between Labour and the SNP in fact.
“There is a bigger difference between Labour and the Conservatives than between Labour and the SNP for sure.”
Ms Sturgeon has called for an increase in public spending of 0.5 per cent per year.
Compared with Labour’s plans, the Nationalists would spend between £10billion to £15billion more per year by 2020.
The Conservatives would spend at least £25billion per year less than Labour by the end of the next parliament, Mr Johnson said.
Ms Sturgeon has claimed the deficit and national debt would fall as a proportion of national income under her plans – though Mr Johnson said debt would be “slightly higher” by the end of the next parliament.
Labour yesterday warned the SNP’s post-election ambition of securing devo max for Scotland would blow a £6billion black hole in the country’s finances.
The party sought to frame the election as a battle between two versions of devolution, as it launched a scathing attack on the Nationalists’ aim of winning full fiscal autonomy within the UK.
A new analysis, prepared by public finance expert Professor Jim Gallagher, predicts a Scotland relying on North Sea oil taxes would be £6billion in the red by the end of the present financial year.
The study forecasts a £3.8billion fiscal shortfall during the last financial year, 2013/14, ahead of official figures due today which will reveal the state of the country’s finances.
Labour’s finance spokeswoman Jackie Baillie said: “These figures show that would result in massive cuts to services or an increase in taxes.
“It would require taxes of £2400 per household extra and that’s to stand still.”
Nicola Sturgeon has said the SNP will press for full fiscal autonomy, or devo max, if the Nationalists hold the balance of power after May 7.
A spokesman for deputy First Minister John Swinney said: “As ever, Labour are quick to talk down Scotland and Scottish economic performance. The reality is that over the past five years, under Labour and Tory Governments, the UK has run up debts of £616 billion.”
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ese figures show that would result in massive cuts to services or an increase in taxes