Jackie Baillie is Scottish Labour MSP for Dumbarton. She says the Scottish Government still has the opportunity to stop the cuts to education and invest in our future.
When the Scottish Parliament was first established in 1999 its powers allowed for different choices to be made from the UK Government. The then Labour-led administration made those different choices on free personal care, on free concessionary travel and on university funding, to name but three policy areas.
From the very beginning there has always been scope for doing things differently. But now, with the major new tax powers heading to Scotland, the opportunity to take a different path from the Tory government is even greater than ever.
Faced with an SNP budget for 2016/17 that passed on Tory cuts and slashed hundreds of millions of pounds from local services like schools, Labour argued we should use our new income tax powers. This was the moment that we could stop the Tory cuts and invest in the future of our country.
Respected economists tell us that the best way to grow an economy is to invest in its people. We cannot compete in a low-waged, low-skilled economy; our aspiration should be for an economy based on a highly skilled workforce able to compete for the jobs of tomorrow, in the industries of the future. Cutting the education budget, when we have already seen cuts – 4,000 fewer teachers and 152,000 fewer college students – is just not good for the economy.
The cuts to come in the next two financial years will be even worse than those experienced so far. So Labour went into the Scottish election pledging to raise the basic and higher rate of income tax by a penny, and asking the richest 1% to pay their fair share through a 50p top rate of tax on earnings over £150,000 a year.
For governments to raise more income, they can either raise taxes or grow the economy. The SNP has singularly failed to grow the economy. Indeed our growth is lower than the rest of the UK; productivity is lower; employment is lower and unemployment is higher. Whilst growing the economy is the best way of ensuring we can afford the very best public services, this is a long term approach and there was an immediate choice to be made. The cuts are happening now.
At a stroke our tax proposals would have stopped the cuts and invested in education and consequently in the economy. Independent experts told us that Scottish GDP could increase by £2bn as a result of our proposals to invest in education.
I know people say that increasing taxes is not popular, yet in poll after poll our tax policies were supported by the overwhelming majority of the public. People just weren’t ready to put their trust in Labour.
The problems in the Scottish Labour Party didn’t happen overnight and they won’t be solved overnight. But our proposals for taxation were bold and radical. They gave us definition against the SNP and the Tories. It was telling that the Tories described the SNP’s tax policies as sensible. This also helped to frame the debate about the new powers coming to the Parliament and how we choose to use them.
I well remember Nicola Sturgeon, the SNP First Minister, travelling down to London during the general election to lecture UK political parties on how to be anti-austerity. How strange it is that, now she has the power to stop the cuts, she seems content to implement Tory austerity.
Our tax policies are right for the times we face. They will frame how we hold the SNP to account. The SNP is now a minority government and faces a major choice – they can work with centre-left parties like Labour or they can work with the Tories. Time will tell if the SNP will simply be a conveyor belt for Tory cuts, but they have form on this. The last time the SNP were a minority government they relied on the Tories for each and every year from 2007-2011 to get their budget through. We will watch with interest.
In the long term, though, the objective must be to grow the economy so we can generate more revenue to fund the best quality public services. But you don’t grow the economy by cutting education. You need to invest in people and in their skills, because in so doing you invest in the future.