As he prepares for tomorrow’s make-or-break Budget, Jeremy Hunt will have been glad to get Shona Robison’s un-solicited advice.
The Finance Secretary counselled the Chancellor to ‘prioritise investment in public services, not tax cuts’ – and, in passing, asked him for £1.6billion.
Well, a government with a black hole in its finances after years of fiscal mismanagement can’t afford to miss a chance to plead for a little more cash.
The implication of Ms Robison’s intervention is that in Scotland the money raised by unrelenting tax hikes has been ploughed into health and education.
Mr Hunt, as he searches for a rabbit to pull out of the hat ahead of the general election, is unlikely to swallow this mythical interpretation of the SNP’s reckless taxation policy.
Reality
The reality is that higher-rate tax was increased by 1p specifically to bolster ‘patient care’ – but the IFS economic think-tank has revealed that real-terms health spending is set to fall in the coming year.
Chancellor Jeremy Hunt was counselled by Finance Secretary Shona Robinson to ‘prioritise investment in public services, not tax cuts’
Nicola Sturgeon’s ambition to stamp out the ‘poverty-related attainment gap’ in schools is set to cost nearly £2billion by 2026.
Yet on key skills such as maths our 15-year-olds lag behind pupils in former Soviet bloc countries such as the Czech Republic, Estonia and Slovenia, and are also outperformed by their peers in England.
In Saturday’s Mail, Andrew Neil wrote about a sense of terminal decline in the UK, and his despair over the complete failure of political leaders to come up with a strategy to reverse it.
That astute analysis is especially true for Scotland, where Nationalist rule has prioritised constitutional grievance since 2007.
The consequences have been disastrous – from crumbling infrastructure to a chaotic justice system and nearly 830,000 patients languishing on NHS waiting lists.
At the weekend, Shelter Scotland accused Humza Yousaf of ‘gaslighting’ by claiming he is tackling poverty while overseeing cuts that condemn thousands of children to homelessness.
The SNP’s alleged socialist nirvana is bankrolled by extra cash squeezed from workers struggling to keep a roof over their heads, but the benefits of these repeated tax raids are hard or impossible to discern.
While attempting to spread the gospel of ‘progressive’ nationalism, Ms Robison remains wilfully blind to the fact that it has prompted the beginnings of an exodus of the brightest and best – people we cannot afford to lose.
The cross-Border tax gap is a powerful disincentive to live and work in Scotland, and it might be about to widen, assuming that Mr Hunt does cut income tax.
He is under great pressure to do so, given the Tories are facing heavy electoral losses.
You might assume from the Finance Secretary’s ominous comments that the SNP is unlikely to follow suit if those taxes are reduced. But failing to do so would be a monumental mistake for the Nationalists, and one that would cost Scotland dear.
Both Ms Robison and Mr Yousaf have voiced concern over the tax disparity which puts workers here at such a huge disadvantage, while refusing to commit to doing anything about it.
They want to have their cake and eat it, appeasing their Marxist Green partners by hitting the rich with taxes, even if the ‘rich’ are senior police officers and teachers, while also claiming to be anxious about the risks of the tax gap – which they created. The recent Scottish Budget included a triple whammy of income tax rises: a new 45p band on earnings above £75,000 starts in April, while the top rate above £125,140 rises by 1p to 48p, and the higher rate threshold will be frozen at £43,663.
Everyone earning more than £28,850 in Scotland will pay more than if they lived south of the Border.
Someone on a £35,000 salary will pay £61 more in Scotland than in the rest of the UK, rising to £442 at £45,000, £1,696 at £55,000, and £2,096 at £75,000.
The ‘wealthy’ are demonised for having the temerity to try and build a better future for their families and, of course, for the country.
It is stagnating under the dead hand of a government which doesn’t understand growth and talks in vague terms about a ‘wellbeing economy’, without providing a meaningful definition.
One option open to Mr Hunt is to cut National Insurance, which would take effect in Scotland regardless of the SNP as – thankfully – it has nothing to do with the Nationalists, unlike income tax.
Galling
It’s galling that we need to keep our fingers crossed and hope this is the path Mr Hunt takes. Surely this was not the point of devolution.
For now, we will sit on the sidelines and might well be watching as tax falls elsewhere in the UK, knowing that the SNP will probably opt against duplicating the cuts here.
But how much more of this can our economy withstand, with a relatively small base of taxpayers having to shoulder the burden of a vast welfare state?
As the NHS faces budget cuts, spending on benefits is set to soar beyond £7billion –38 per cent higher than last year’s £5.16billion.
Yet one in 20 working-age people have never done a day’s work in their lives in parts of Scotland, and the numbers have rocketed since the SNP came to office.
It’s a criminal waste of human potential but the only plan Mr Yousaf appears to have is to perpetuate it by picking the pockets of Scots who work for a living.
Eleven per cent of Scottish adults pay the higher rate of income tax (42p in Scotland, thanks to the hike announced in 2022 by the then Finance Secretary John Swinney), and 0.7 per cent pay top rate.
Perks
Despite this, these individuals – higher and top rate taxpayers – are estimated to account for 65 per cent of the total income tax take in 2023-24.
Don’t forget that 39 per cent of Scots don’t pay any income tax – a model that is completely unsustainable.
We’re told by the SNP that higher taxation is the price we must pay for the ‘social contract’ which means we’re able to enjoy perks which are unavailable in England.
‘Free’ prescriptions cost £1.4billion a year – a figure that has risen by 19 per cent in the past decade – while each year £10.5million is spent by the NHS on paracetamol, £2.9million on aspirin, £1.6million on sun cream, and £1.8million on shampoo.
The cap on university places for Scots means that they face a tough contest against fee-paying international students – another flagship policy which patently isn’t working.
As higher taxes force entrepreneurs and hard-working professionals to pack up and head for the exit, a dwindling pool of taxpayers will have to shell out more and more to fund perks and handouts.
This is a pivotal Budget for the Tories.
But, whatever Mr Hunt decides, Scotland simply cannot take any more of the SNP’s high-tax lunacy.