Thousands of public sector jobs will be axed and taxes may be forced up after the Scottish Finance Secretary Shona Robison admitted a £5 billion black hole in the government’s budget.
Ms Robison blamed “Westminster austerity” as she published a five-year plan for the government’s finances that drew accusations of “financial incompetence” from opposition parties.
She said public sector staff would be cut by 0.5% annually – amounting to between 10,000 and 12,000 full-time equivalent jobs – though these will largely come through “natural attrition and recruitment controls”.
Scottish Labour’s Daniel Johnson said compulsory redundancy was still the “default position”, and Ms Robison admitted this is now an option.
She said reforms to “back-office and corporate costs” would be preferred over changes to frontline operations.
Delivering the Medium Term Financial Strategy in parliament, Ms Robison said: “Managing the impact of Westminster austerity is all too familiar.
“In spite of this we continue to invest in the people of Scotland, supporting a better-paid public sector, delivering high-quality public services and providing welfare support that is not available in other parts of the UK.”
Michael Marra for Scottish Labour, said “years of mismanagement of the public finances” had finally caught up with the SNP.
Craig Hoy, Scottish Conservatives spokesman on finance and local government, said: “This inadequate and delayed statement is too little, too late to address years of gross financial incompetence from the SNP.
“Thanks to the nationalists’ mismanagement Scots will be facing continued tax rises or cuts to public services in the coming years.
“Shona Robison has failed to offer a single credible proposal that will deliver the economic growth that Scotland so desperately needs.”
Scottish Liberal Democrat economy spokesperson Jamie Greene, said: “The SNP’s economic thinking is late, incompetent and unsustainable.
“There’s next to nothing in here about how to help small and medium sized enterprises which are the backbone of our economy. There is next to nothing on how the government will lower the burden of red tape or make it more attractive for people to start a business.
“There is also nothing about getting people back to work by tackling health and mental health waits. We are spending millions on social security for people who could get back to work if they could get the operation or mental health support that they so badly need.”
David Phillips, associate director of the Institute for Fiscal Studies, said: “The Scottish government cannot borrow to plug these gaps. Some combination of measures to curb spending and boost revenues is required. The fiscal challenge facing Scotland is large and real.”
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