John Swinney: 'Appalling' state of UK finances will mean tough decisions for Scotland

Scottish First Minister John Swinney has said Chancellor Rachel Reeves’s announcement of cuts to cover a projected £22bn UK Government overspend will lead to “tough decisions” on spending in Scotland.

The SNP leader said the “appalling picture” of the public finances set out by Reeves in a speech in the House of Commons on Monday will “inevitably” mean a reduction in the amount of money made available to his government.

The Labour Chancellor put the country on notice about future tax rises as she accused the Conservatives of leaving an “unforgivable” £22bn “black hole” in the public finances.

She cancelled or postponed road and hospital building projects including the £2bn Stonehenge tunnel scheme, stopped winter fuel payments to pensioners not on benefits and warned “difficult decisions” would be required on tax in her first budget on October 30.

Reeves also accused her Conservative predecessors of covering up the scale of immediate spending pressures on the public purse.

But predecessor Jeremy Hunt claimed around half of the “black hole” in spending was due to her deciding to give above-inflation pay rises to millions of public sector workers.

Swinney responded: “The Chancellor has painted an appalling picture of the financial future facing the UK.

“By echoing the previous government’s fiscal rules, they are trapped into delivering massive spending cuts.

“We warned this was the reality and today has seen that truth validated.

“Now, if they do not change course, the reality of the UK’s finances will inevitably affect the funding available to us here in Scotland.

“Their decisions today mean tough decisions ahead for Scotland.

“What is particularly worrying is that the Chancellor announced she is not fully funding the public sector pay deals she has accepted.

“Instead, cuts are being demanded across most of Whitehall.

“That means that we will not receive full Barnett consequentials from these pay deals.

“The Scottish Government will prioritise action to tackle child poverty, grasp the opportunities of net zero and grow the economy by investing in public services and infrastructure.

“And, while we will work with the UK where we can, we will continue to argue they must drop the damaging cuts and set new spending rules that support investment.”

The Scottish Conservatives said the Chancellor’s decision to restrict winter fuel payments would be “a bitter blow” to pensioners up and down the country.

Scottish Conservative shadow finance secretary Liz Smith said: “This was a cynical and calculating statement by Rachel Reeves, in which she feigned pre-election ignorance about the state of the public finances to pave the way for Labour tax rises.

“Labour were repeatedly warned by independent experts, as well as rival politicians, during the election campaign that their sums didn’t add up, yet we’re expected to believe the Chancellor was blissfully unaware.

“Her announcement that the winter fuel payment is to become means tested is a bitter blow to pensioners across Scotland and the UK.

“Scotland is already the highest tax part of the UK, so the last thing hard-working Scots need is additional Labour tax rises, which are looming in October’s budget.”