The Truth Is, the SNP's Way of Managing Our Money Makes a Dog's Breakfast Seem like a Michelin Dinner; AS THEIR FLAGSHIP FISCAL POLICY FALLS APART SO DISASTROUSLY

Daily Mail (London), February 12, 2009 | Go to article overview

The Truth Is, the SNP's Way of Managing Our Money Makes a Dog's Breakfast Seem like a Michelin Dinner; AS THEIR FLAGSHIP FISCAL POLICY FALLS APART SO DISASTROUSLY


Byline: by Allan Massie

IT is not only the best-laid schemes o' mice and men that gang aft agley. Badly laid ones, happily, sometimes do so, too. Finance Secretary John Swinney's reluctant announcement that he has abandoned attempts to replace council tax by a pseudolocal income tax - pseudo because the rate was to be set at Holyrood, not by local authorities - falls into this category.

A centrepiece of SNP policy, it had been touted as a fairer tax. Certainly some would have benefited. Others, however, including young married couples, would have been worse off if both were in employment and earning enough to pay income tax.

But whether the change would have made for a fairer tax is for the moment immaterial.

The climbdown, following his difficulties in getting his budget approved by the parliament, is a humiliation for Mr Swinney, and for the First Minister and the governing party.

Admittedly, the proposal has not been abandoned - not yet anyway. Mr Swinney says it is only being shelved for the life of this parliament and will be introduced again in the next parliament.

Reservations

This is somewhat presumptuous. Like Gordon Brown and Alistair Darling, who impudently seek to decree what tax rates should be in future years when they may, God willing, be no longer in power, Mr Swinney seems to be taking the electorate for granted and to assume that the SNP will be leading the Scottish Executive after the election of 2011.

Perhaps it will. This may even be probable but it is not certain and ministers would be wise not to count their chickens before they are hatched.

This is, however, a lesson they seem slow to learn. Just a couple of months ago Mr Swinney told us how he was going to finance the new road bridge over the Forth. He would bring forward money from future budgets.

Unfortunately, he had neglected to clear this with the Treasury, which provides the money for the parliament to spend.

When he did so, he was told it wasn't on. You can't bring forward money, they said, from budgets that have not yet been drawn up and allocations made. Too bad.

Though it is likely he would have failed to get his proposal to replace council tax by his pseudo-local income tax approved by the parliament, for the Tories and Labour are against it and the Liberal Democrats have reservations about it, Mr Swinney is once again blaming the Treasury.

This is par for the course, standard SNP practice. Blame London. Nothing is ever its own fault, no matter how stupid it has been.

One stumbling block was certainly laid in his path by the Treasury, quite reasonably as it happens. Mr Swinney could make his sums come out right only if the Treasury continued to pay the [pounds sterling]400million it hands over every year to compensate for council tax rebates.

This money is paid because some people are either excused paying council tax, or pay a reduced sum; and this is as it should be.

However, the Treasury pointed out that if Mr Swinney abolished council tax and replaced it by his pseudo-local income tax, there would be no [pounds sterling]400million in council tax rebates winging it way every year to Scotland.

This would be because there would now be no council tax, and no poor people being excused it or required to pay only a reduced rate. This is palpably the case. You don't have to be very bright to understand there can be no rebate for a tax that doesn't exist.

No council tax, no rebate. Clear as a sunny summer day, you might think.

Not clear, however, to Messrs Swinney and Salmond. They emitted shrill squawks of protest. It's our money, they shrieked, in defiance of both reason and reality.

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