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More pain. When will there be gain?

GEORGE Osborne's axe must be blunt by now.

The Chancellor's latest projected spending cuts, for the year 2015/16, risk having a depressive effect not only on the national psyche but also on the pace of the country's economic recovery. It seems eons ago now that the three UK party leaders, David Cameron, Nick Clegg and Gordon Brown, warned on the General Election hustings of tough times ahead, but the Conservatives predicted then that their tough love would only be necessary for one parliament.

One nasty Eurozone crisis and a lot of bitter arguments over the Government's economic course later, they have been forced to eat their words. Now the Chancellor is announcing an eye-watering £11.5bn of further cuts, while trying to deflect attention and win heartland votes with yet more talk of tougher conditions for benefit claimants.

In England, health and schools budgets are to be protected with other departments sustaining cuts of 6-10% on average, but what of Scotland? The Scottish Government learned yesterday that it must find savings of 2% in real terms in its day-to-day resource budget. At the same time it was announced that its capital spending allocation is being increased by 12.9% to allow it to spend more on infrastructure projects.

There is no disguising the fact that more cuts after so many years of austerity amounts to bad news for Scotland; nevertheless the Scottish Secretary, Michael Moore, was yesterday insisting that the settlement for Scotland's day-to-day budget was "significantly better than the reductions across the rest of the UK" and hailing the capital budget increase.

Those claims were of course met with howls of derision from St Andrew's House, with Finance Secretary John Swinney pointing to a substantial real-terms cut in the Scottish Government's budget.

Voters could be forgiven for having their heads in their hands as they are caught in the statistical crossfire. What is undeniable is that the reduction in the budget announced yesterday is going to affect some services, somewhere in Scotland.

Could the UK Government's latest round of cuts have been averted or lessened had the Chancellor taken heed years ago of those who warned that the depth of austerity was holding back economic growth? Quite possibly. The increase in capital spending could be taken as a tacit admission by Mr Osborne that he needs to finesse Plan A, even if he still shows no appetite to embrace Plan B. It must also be said, however, that there was never going to be a simple, painless route out of the economic doldrums, not for any government.

The Scottish Government has an opportunity to garner support for independence and it has not been slow to try and exploit it. Mr Swinney presented the latest cuts as evidence of the two futures facing Scotland, deriding George Osborne's "disastrous economic agenda" and holding up independence as an escape route from austerity. Whether voters will be convinced that the grass would be greener is a moot point, but the fact that cuts will drag on until after the referendum is uncomfortable for the pro-Union parties, to say the least.

The truth is that if austerity emanating from Westminster continues until the closing years of the decade, it will not bode well for Scotland, whichever way next year's referendum vote goes.

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