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The dog that didn't whimper

Brian Taylor | 14:45 UK time, Thursday, 8 January 2009

Money, money, money.

During first minister's questions, we learned that interest rates have been cut again to their lowest level since the Bank of England was founded in 1694 - by a Scot, one William Paterson.

It was fitting, therefore, that the exchanges with the first minister were mostly concerned with cash or, more precisely, capital.

Both Iain Gray and Annabel Goldie voiced deep disquiet with the Scottish Government's handling of the proposal to fund a new Forth crossing.

Mr Gray was notably persistent. However, the best soundbite belonged to Miss Goldie who opined that Alex Salmond was more concerned with "burning bridges" with Westminster than building such structures in Scotland.

Mr Salmond initially appeared to struggle just a fraction - or, at least, in comparison with his customary sangfroid.

He very soon rallied, though, and offered rebuttal if not quite refutation to the opposition attacks.


You'll recall the background here. The Scottish Government wants the Treasury to release more money for capital investment in the next few years to build the bridge - on the understanding that Scotland would get less over a 20 year period.

No dice, says the Treasury. That's borrowing money now from budgets which don't yet exist.

Opposition leaders said Mr Salmond should have known his plan was a non-starter.

Further, they asserted that his government should not have announced this plan at Holyrood without establishing the Treasury view.

There began the Salmond fight-back. Firstly, he stressed that the bridge would be built by traditional procurement means.

What was in question was whether that cost could be spread - or whether it was all to be accounted for in a few years, thereby putting "substantial" pressure on other capital projects.

Secondly, he said PPP/PFI was now a non-starter because new accounting rules mean such projects count as public spending.

Confident performance

Mr Salmond said PPP/PFI would now mean that the whole cost of the bridge, some £2bn, would be accounted for in a single fiscal year: that is, more than half the annual Scottish capital budget of £3.5bn.

Scotland would then repay the PPP cost over decades.

Thirdly, he challenged his rivals to say how they would propose to pay for the bridge.

In particular, he tackled Labour over whether they would absolutely rule out toll charges.

It was, ultimately, a confident performance. However, it still leaves the question of the dog that didn't bark - or even whimper: the Scottish Futures Trust.

As Iain Gray pointed out, the SFT had played no role in the bridge scheme, despite advance billing.

Still with money, more re the controversy over the Scottish Budget for next year.

There were further talks behind the scenes today. For example, I understand the Greens have been sounded out again about their potential support for the Budget.

Doing a deal

Their price is quite specific - and rather substantial. They want a £100m project to enhance home insulation on an area basis: that is, universal rather than by individual applicant.

SNP plus Greens plus Tories would add up to a majority. If the Greens can be persuaded.

If and when the Tories advance a detailed shopping list of their own - and if and when a deal can be done with them.

They insist they're ready to vote "No" or "Yes". Don't think they'll abstain.

John Swinney, the finance secretary, only needs to cut these particular deals - if Labour and the Liberal Democrats vote No to the budget.

Last year, they ended up abstaining. Right now, it looks as if both those parties are talking themselves into a "No" vote.

The Lib Dems want income tax cuts (vetoed by Swinney, J.).

knowing grin

Labour wants its package on the economy adopted en masse by the SNP. John Swinney might well be up for deals on individual measures - but I suspect he would regard the wider Labour demand as being, in effect, a surrender of control.

Stand by for a game of political poker. The stakes? Nothing much: just £33bn of public spending and the future of the Scottish Government.

Still think the Budget will get through, though.


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