The Unionists fiscal plans raise more issues than answers

Sir Keir Starmer has insisted there will be no income tax, National Insurance or Vat rises under his watch. Backed by his potential Scottish secretary Ian Murray, potential chancellor Rachel Reeves and CEO of branch office Anas Sarwar, all of the above claim there is no money left. If that’s so, where is the money coming from to fulfill their manifesto contracts?

Both major parties claim there is no £18 billion worth of cuts to the public sector, while the Institute for Fiscal Studies, Institute for Government, the Resolution Foundation and the Joseph Rowntree Foundation clearly say there is.

Who is the electorate to believe? Is the electorate better off with the devil we know or the devil we don’t? Is Britain better with another five years of Tory austerity or Labour austerity? And, let’s face it, they have to obtain money for their manifesto plans from somewhere.

Are Labour going be using private finance initiatives in England? Scotland is experienced in this, under the last Labour first minister Jack McConnell. And we are still paying it back.

Is Keir Starmer going to use quanitative easing – a fancy name for the Bank of England to print more money, and with a potential to raise interest rates and the cost of living?

Or is he going to use the example of monetary skills laid out by Gordon Brown in his premiership? That is, sell off what’s left of the gold reserves and dip into the pension pot of another £120bn?

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Keir Starmer, Rachel Reeves and Anas Sarwar state that everything is costed – great, can the electorate see these costings? They appear to be very secretive in this area.

As for Labour’s other great fantasy, GB Energy; how is that going to secure 100,000 jobs when there is no infrastructure, just an investment company that is allegedly going to supply cheap energy? Would it be possible to see a list of potential investors?

If they do decide to do oil licensing, surely this will affect the Treasury’s income as they won’t receive as much in fuel duty, so what will fill that financial hole?

Between the two main parties, they have raised more issues than given answers, straight or otherwise. There is still the issue of the two-child cap and the mitigation of the bedroom tax to iron out, and of course Labour have now said they will review Universal Credit.

See me, I am SNP.

Robert McCaw

Renfrew

IF I were to put an item up for sale on an internet auction site, accept an offer for it, take the buyer’s money and then fail to deliver the item, the buyer would be less than pleased. The SNP are doing just that.

My social media is currently swamped by a recurring SNP advert with a large picture of the First Minister and four pledges, promises, vows even.

One of which is delivering independence for Scotland.

Voting SNP in 2015, 2017 and 2019 delivered lots of SNP MPs but did not deliver independence. You would have to be fairly gullible to think that delivering less SNP MPs in a few days’ time will, as if by magic, deliver our independence.

None of their other three promises/pledges/vows can be achieved by voting SNP. How will the SNP legislate for an essentials guarantee with their remaining MPs in a UK parliament of around 600 Unionists? “Our NHS” is devolved to Holyrood.

It is up to the current SNP Holyrood government to try to look after it. Joining the EU is a pipe dream while the SNP are determined to promote Freeports, have no answer to the obvious questions of a Scotland inside the EU bordering an England outside the EU and would find it almost impossible to meet the EU’s financial entry requirements.

The voters of Scotland are not daft. They can see that these four promises cannot and will not be kept after the fourth of July. Perhaps the deletion of the first promise and its replacement with the words “Only with independence can we” would make a bit more sense and at least begin to be a little more honest.

Dr Iain Evans

Edinburgh

DID you know that every pound the government spends on healthcare generates £4 of economic activity? This is the multiplier effect – a concept articulated by John Maynard Keynes in his 1935 book, The General Theory Of Employment, Interest And Money.

It measures the economic activity resulting from an increase in government spending. If the multiplier is more than one, the additional spending stimulated a larger increase in income than the original amount. Conversely, if it’s less than one, the additional spending caused income to fall.

Suppose the government spends £1 more on a nurse. After tax, the nurse has 67 pence. If that money is saved in a bank, it won’t generate any economic benefit because banks don’t lend out other people’s savings but create the money they lend out of thin air. And because nearly half of people in the UK have £1000 or less in savings and a quarter have less than £200, it’s likely the nurse will spend the extra income.

That spending becomes someone else’s income on which tax will be paid. If the nurse buys something in a store, the owner and staff receive income and pay tax on that income and the nurse pays VAT. Those who supplied the goods to the shop also receive income which they then spend and pay tax on, etc. The cycle continues with the extra government spending becoming smaller as it works its way through the economy.

Two things have happened. First, the nurse’s extra 67p becomes additional income for many more people. Second, it becomes additional tax revenue for the government since it’s taxed at each stage. But has a politician ever admitted that when government spends more, it also collects more in tax?

New spending can pay for itself out of new taxes paid. But it depends on what the government spends money on. It’s the “Guns vs Butter” model, which describes the tradeoffs governments face in deciding to spend on defence versus social programmes.

If it spends more on “butter”, eg, healthcare, then there’s a significant net gain to the economy. Not only are healthcare workers employed, but the nation’s health improves. If, however, it spends more money on guns, eg, defence, the multiplier is 0.6. And if the money goes on nuclear weapons, it’s negative. That’s because there’s no “market” for nuclear weapons – the hope is that they’ll never be used. They’re a “sunk cost” that is lost forever to the productive economy.

Yet that sunk cost is rising globally. Spending on nuclear weapons rose by 13.4% in 2023. The US led with an 18% annual increase. The UK was second at 17.1%. Recently, Rishi Sunak pledged to increase defence spending to 2.5% of GDP (£75 billion over six years), making the UK the second largest defence spender in Nato. Keir Starmer has made the same pledge.

Empirical evidence shows that when governments spend money to meet their people’s needs for health, education, housing, energy, jobs and transport, the multipliers are significantly more than one. This makes intuitive sense but it’s remarkable that the Tories or UK Labour haven’t made the connection that spending on one’s people is the best possible investment they can make.

Instead, the UK Government has slashed public spending, worsening inequality and poverty. Public sector employment has fallen from 22% in 2009 to 18% in 2024. And don’t expect any change under English Labour. Rachel Reeves claims that the private sector is the “lifeblood of economic growth”, Wes Streeting says the NHS needs more privatisation and Kezia Dugdale warns that UK Labour may have to scrap free tuition in Scotland.

It comes down to what kind of society we want in Scotland. If we’re happy remaining under Westminster rule, then by all means, let’s stay in the failing UK. But if we believe we should run our own affairs and invest in our people so that they can have a better life, then we have no choice but to terminate the Union.

Leah Gunn Barrett

Edinburgh

PUTTING independence on the back burner for a generation is an understatement, as Unionist politicians really mean it to be for your lifetime.

A lifetime during which UK governments will continue to use Scotland’s natural resources to bolster its international ambitions and position on the world stage.

It’s galling to see the income from Scotland’s natural assets of oil, gas, wind, tide and water taken by the UK Government to fund its global ambitions while England – which is the only country in the Union totally governed by the UK Government – lags behind the rest of the UK in so many ways.

For too long, UK governments have been bolstering the obscene returns for the players in the casino known as The City, causing such a local income unbalance that it is having to pay out the highest per-capita amounts in the UK from its levelling-up fund to provide affordable housing for the much-lower-paid people who live and work there.

You only have to read the SNP’s list of their 100 achievements to understand how much the people of England are paying for their incompetent governments’ obsessions with keeping a prominent place on the world stage.

If the Tories are annihilated in the election, it will show that the voters in England have at last rebelled against the establishment – but they will go from the frying pan into the fire as long as the Westminster two-party system exists.

Scots have the option now to get behind the SNP who are working towards Scotland becoming a nation again and taking back control over its natural resources so that those living in Scotland get bigger benefits from its natural resources.

On the eve of the referendum, David Cameron asked us to stay and help guide all of the families in the UK along his promised path to a better future. We stayed but the path is still a promise being repeated by the Unionists in the run up to next week’s election.

Now is the time for Scots to lead the people in the other three nations out of a union whose government has become totally divorced from the reality of the needs and aspirations of the peoples of all of its member countries.

John Jamieson

South Queensferry

IN his letter in The National on Friday, June 21, I McGregor refers to Scotland’s long tradition of sovereignty of the people but he goes a step further and states that this sovereign power should be used to determine independence.

It is most refreshing to see someone in Scotland put the idea of peoples’ sovereignty into practical terms and point to the obvious. If the Scottish people are indeed sovereign then the decision on independence is not an issue for negotiation with anyone outside Scotland, it is simply a matter of decision for the Scottish people.

Why is that so difficult for politicians and other to understand? Either the Scottish people are sovereign in Scotland or they are not. If they are – and all the evidence supports this – then they have the ultimate power to determine constitutional law in Scotland. To deny or ignore this is to disrespect Scottish sovereignty and the Scottish people, and which party is prepared to do this?

Andy Anderson

Ardrossan