Better public services need to be paid for. Political parties which do not back well-meaning rhetoric with resources cannot be taken seriously.
Many of the policies set out in this manifesto would require no additional money, could be paid for from within existing budgets, or are dependent on resources becoming available in the future from changed budget priorities and from additional money from the annual UK budget settlement. Ihis is true for all of the measures outlined in this manifesto, except for some of those in the education and health chapters.
There is no doubt that if we are to have better education and health services in Scotland, we shall have to find additional resources. Under the present Labour Government in Westminster there is no cash bonanza for public services in Scotland. Spending on Scotland's schools has been cut by over £200 million in real terms since Labour came to power; with cuts in 29 out of 32 education authorities. Total real spending in Scotland in 2001/02 will be little changed from the level in 1994/95, and the real annual increase in the budget for the National Health Service will be about the same as under the Conservatives.
Extra money for health and education
Under our plans for improving standards in education and health, we envisage increasing budgets for these services from the first full budgeting year
For health, we would boost the planned budget by around £80m in 2000/01, and by more than £1OOm per year for each successive year of the first Scottish Parliament.
For education, we would boost the planned budget by around £170m in 2000/01, and by some £170m for each successive year of the first Scottish Parliament until 2003/04.
Finding the funds
In order to find the funds to increase spending on Education and the National Health Service,
Use the period from the Scottish parliamentary elections in May 1999 to the first Scottish Parliament budget in Spring 2000 to scrutinise the total Scottish budget for savings. Aim to achieve additional efficiency and other saving from the total Scottish Budget. The Scottish Executive will be required to urgently carry out an audit to scrutinise all areas of expenditure to cut out wasteful or lower priority spending, including on items such as administration, publicity and advertising and consultants. We will eliminate waste with Gladstonian vigour. We envisage that this alteration of spending priorities would allow us to re-allocate into front-line education and health budgets at least £50m per annum in the first full budget year (2000/01) - representing a modest and cautious one third of one per cent of the total Scottish spending budget. We would increase this figure to £60m per year for future years.
Put pressure on the Government at Westminster to make an early announcement on the size of the allocation from the Government's contingency reserve for the year 2000/01 and for future years. We will press the UK Government to announce allocations from the Contingency Reserve in the November 1999 Pre-Budget Statement. In this way a clear picture of the financial position for 2000/01 would be available well in advance of the first Scottish Parliament budget.
If necessary, use 1 penny of the permitted tax varying powers in the spring 2000 budget. Without additional monies from the UK budget settlement, we anticipate that paying for our plans will require the use of 1p of the variable tax power. But we cannot conclusively take this decision until we know the final budget for 2000/01, including the matter of whether or not the Chancellor is going to allocate extra money. If, and only if, insufficient monies are available from these other revenue sources, we would use the tax varying powers to increase revenues for 2000/01. Provided the UK Government announces the distribution of the contingency reserve in good time - at the time of the November 1999 Pre-Budget Report - then we will expect to make the situation regarding tax varying powers clear by the end of 1999, allowing time for any administrative changes which are necessary. Using 1p or 'one penny' of the tax varying powers would raise over £200m net in the first year and in excess of this amount net for each future year.
Use of tax varying powers
Scottish Liberal Democrats are not afraid of using the tax varying powers of the Scottish Parliament if that proves to be necessary. If we want first class public services, then we must be willing to pay for them. But our fundamental commitment is to better services, not higher taxes. If we can fund the improvements to public services which we seek without recourse to higher taxes, then so much the better
In any case, we do not envisage that the plans which we have set out in the chapters above would require recourse to any more than 1p of the tax varying powers within the period of the first Scottish Parliament.
Community Partnership Trusts
We will seek to invest in capital projects for better hospitals, schools, and house building programmes; water supply infrastructure; and public transport schemes by seeking to establish Community Partnership Trusts to replace the expensive and inefficient Private Finance Initiative agreements. We need a private public partnership which leads to more cost effective public sector investment strategy. We will also seek the appropriate alteration to the current unnecessary restrictive Treasury rules regarding investment. It is vital that the public retain the right to own the assets at the contract period. We will also separate out the maintenance and service contracts and subject them to "Best Value" criteria.