Scotland’s housing secretary is urging Rachel Reeves to help “reinvigorate housebuilding” in the Budget.
Mairi McAllan insisted the Scottish Government had already put “strong foundations” in place to “ramp up” the sector – with Holyrood ministers having pledged almost £5 billion for a programme which could deliver up to 36,000 new homes across the country.
But arguing that these plans could be “hampered” by a reduction in Scotland’s capital funding, she called for action from the UK Chancellor.
Ms McAllan made the plea as she travelled to London to meet with key investors and stakeholders to showcase Scotland’s housing sector and encourage more investment ahead of Wednesday's Budget.
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That comes after she announced a government action plan in September, with the housing secretary promising £4.9bn over the next four years
In the wake of that, Ms McAllan said the Scottish Government has “created strong foundations in Scotland to ramp up housebuilding through our housing emergency action plan”.
However, she added: “These plans could be hampered by the UK Government’s planned cuts to our capital funding and in a shortfall in financial transactions, which are a vital tool in delivering homes across Scotland.”
In addition to these measures, she urged the UK Chancellor to consider writing off local authority housing revenue account debt, saying this would “encourage more investment in housing”.
Ms McAllan continued: “Whilst in London I will be demonstrating my ambition to bring more investment to Scotland and increase housing supply.
“I urge the Chancellor to show the same ambition and reinvigorate housebuilding across the UK, with significant benefits to the sector in Scotland.”
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Over the weekend, Scotland’s finance secretary set out her demands to the Chancellor calling for more investment in public services, more support for economic growth, and action on the cost-of-living crisis.
Shona Robison urged the UK Government to take action to lower household energy bills, to ensure that any major taxation choices do not see Scotland losing out on vital funding, and to reform the energy profits levy to support jobs and investment across Scotland’s energy sector.
Her intervention comes amid weeks of briefings and speculation over what may be announced by Ms Reeves and as the Scottish Government looks ahead to unveiling its own financial plans in January.
“The UK Budget process has been chaotic and mired in damaging uncertainty," Ms Robison said.
“Last year, the UK Government increased employer national insurance contributions without any consultation, which led to a funding shortfall of around £400 million for public services in Scotland and acts as a tax on jobs. We cannot see a repeat this year.
“We need to see a change of course from the Chancellor – with investment in public services and infrastructure, which supports industry and jobs and delivers support on the cost-of-living challenges people across Scotland are facing.”
A key Budget announcement by Ms Reeves is expected to be the ending of the two-child benefit cap - a longstanding ask of the Scottish Government.
The decision is expected to cost the UK Government around £3bn a year, but the UK government is expected to argue it will save public money in the long term by tackling poverty and reducing pressure caused by poverty on public services.
The boost to low income families comes amid mounting unease among some Labour backbenchers, who scuppered £5bn of benefit cuts last summer.
Only months ago the Treasury said that a rebellion by Labour MPs over the summer, which forced the government to ditch £5bn of cuts to health and disability benefits, had made it unaffordable to end the two-child benefit cap.
However, Ms Reeves has faced mounting pressure from backbench Labour MPs to end the cap, with Prime Minister Sir Keir Starmer and Bridget Phillipson, the education secretary, among those in government in favour of its abolition.
To meet spending demands, the Chancellor is expected to unveil a “smorgasbord” of tax rises in the Budget after she dropped plans to break Labour’s manifesto and increase the basic rate of income tax for people in England, Wales and Northern Ireland. A different income tax system is applied to taxpayers in Scotland.
Among the measures she is expected to announce on taxpayers across the whole of the UK will be a tax raid on pension contributions, which could be worth as much as £4bn, a gambling tax and a pay-per-mile tax on electric cars.
Paul Johnson, the former head of the Institute for Fiscal Studies think tank, said: “Assuming the two-child limit goes, and following U-turns on winter fuel and disability benefits, we are looking at something in the order of £10bn a year of additional spending in the forecast period relative to what we were expecting at the spring statement.
"At best there is no effort to get welfare spending down and the net effect is an increase because of the decision to scrap the two-child limit.”
On the eve of the Budget, Scotland's trade union body called for the Chancellor to “deliver for workers”.
The Scottish Trades Union Congress (STUC) set out five tax demands ahead of the statement, including actions on wealth taxes, bank profits and a “settling up” tax for those moving wealth and assets abroad.
On Monday it was announced that the Chancellor will unveil up to £14.5m in investment for Grangemouth in the Budget.
Scotland's only oil refinery stopped processing crude oil at Grangemouth in April, after a century of operations.
Scottish Secretary Douglas Alexander said that more details would be confirmed in the Budget on Wednesday, but that the £14.5m would be "targeted towards jobs on the Grangemouth site".
The UK government has been accused of failing to deliver £200m pledged to Grangemouth from the National Wealth Fund.
Mr Alexander told BBC Radio Scotland Breakfast: "I've been working hard with the Treasury to make sure that, while we are working to find a commercial buyer for Grangemouth, we are also unlocking new funds that will be able to provide new jobs and new opportunities on the site."
The UK Government has been contacted for comment on Ms McAllan's requests.
