Wealth and property taxes, not job cuts, are the way forward

Of course, the Scottish Government deepened its own difficulties with its council tax freeze announcement in September. It was a move that reeked of short-term politicking rather than good governance and simply deepened the fiscal hole for Shona Robison to try to climb out of.

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According to the IPPR, the freeze will reach just 60 per cent of working age adults in poverty compared to 95% of those who are not. 50 per cent of pensioners in poverty will benefit from the freeze, compared to 75 per cent of those who are not. Even for those who do benefit, the average gain will be £1 a week, and significantly less for those in lower-value housing.

On top of Tory austerity, this measure meant that Ms Robison needed to find over £1 billion in revenue funding just to stand still. She didn’t, and that’s where the cuts come in.

£200 million was cut from housing in the middle of a homelessness emergency. The inadequate funding for local authorities threatens core services. It’s not just councils. There were cuts to higher and further education and a failure to adequately fund the Fire and Rescue Service. Meanwhile dark warnings of job cuts across the public sector filled no-one with pre-Christmas cheer. The part of the Finance Secretary’s speech that gave me particular concern was when she said: “We recognise that we cannot address the financial challenges before us through tax alone, or by delivering public services in traditional ways. Our approach must be investment and reform. Working in partnership with Scotland’s trade unions, we will take action to ensure our services remain sustainable, improve outcomes, and support the people and communities who need them most.”

I want to be very clear: Scotland’s trade unions won’t countenance any package of "reforms" - worrying terminology which is political speak for cuts - if it harms our public services. We will, as we have successfully and prudently done for years, work with the Scottish Government where we can, to find solutions which benefit working people across Scotland. But be in no doubt we won’t be the fall guys or the patsies for years of chronic underfunding of our public services and no reforms, however necessary Scottish Government ministers say they are, will be signed off in our name if it harms workers and the services they rely on.

There were a few Budget positives for the STUC (Image: PA)

There were a few bright Budget bright spots for those of us who were looking for the Government to signal a different course, and these should not be ignored.

The Government took a more proportionate approach to rebates for business signalling a recognition of the importance of the public sector to growing the economy. Decent infrastructure, services and education are as important for business growth as they are for the rest of us.

Perhaps most importantly, although it has made more of a headline splash than perhaps it merits, is that additional funding will now come through a new 45% advanced rate of income tax on those earning above £75,000. There is also an increase in the top rate of tax, up to 48%, on those earning above £125,140.

This is the part of the column when, unashamedly, I congratulate every single person who supported and, ultimately successfully, lobbied for this part of our well-covered and well-trodden tax proposals.

Our movement, made up of trade unionists, charities, NGOs, progressive think tanks and the rest of civic Scotland has consistently made the case for this. We do commend the Scottish Government for heeding these calls, particularly as so much of the Parliamentary opposition coalesced around impossible calls for more spending but lower taxes.

Of course, the Government did not go far enough. Our full proposals for progressive tax reform could have raised more than the £1 billion the Government needed. It would have involved hard choices, but not as hard as the choices made to cut the support and services I outlined earlier.

There is now a clear dividing line between trade unions, civil society, campaign organisations and progressive think tanks on the one hand, and Government and the wider Parliament on the other. It is based upon our understanding that in the short-term income tax rises are necessary if we want to provide the services and financial support needed by the less well-off. But it is also born of a recognition that widescale tax reform is now an urgent priority.

We are united in a call for an immediate council tax property re-valuation as precursor to the introduction of wealth and property taxes. Meanwhile, the parliament seems content to fiddle while Rome burns.

Read more: Public sector job cuts can be avoided with a new approach to tax

So, what we want for Christmas is for politicians of all hues, all of whom claim to recognise that our local taxation system is broken, and all of whom insist that the potential for raising income taxes for higher earners is at best a limited tool, to do something about it. That means taxing immovable assets and wealth.

If they started now, by the medium term they could be raising an additional £3.7 billion of revenue for the public purse.

Inevitably, much of the next year will be taken up with the desperate need for a change of UK government. The Tories’ projected public sector cuts over the next few years are widely understood to be both ridiculous and unmanageable. Anything would be better, though how much better remains to be seen. We desperately need resource and capital investment across the UK to strengthen our infrastructure and to kickstart a meaningful industrial strategy, publicly directed and owned. A change in strategy at Westminster would certainly be better for Scotland. However, our parliament has the opportunity to show leadership by acting now. We hope it takes it.

Roz Foyer is General Secretary of the STUC