SNP rediscovers its political confidence with slick budget

The SNP appears to be rediscovering its political confidence after the party’s most disappointing period since taking power at Holyrood.

Over the past few years its independence strategy has failed, the party has tied itself in knots over gender reform, and it has fallen out of love with the Scottish Greens.

There have been three First Ministers during that period and one of them is under police investigation as the Branchform investigation into SNP finances continues.

The party’s concerns have not gone away. Far away from.

It still has major challenges to overcome, not least significant underperformance in key public services such as the NHS.

Even its selection process for Holyrood elections can be a source of bitter infighting.

Yet at the end of the week in which First Minister John Swinney’s government presented a draft Scottish budget, his team sounds more optimistic than at any time in at least two years.

This may seem strange given that the SNP had completely lost control of the narrative in Scottish politics and were comprehensively defeated by Labor in the general election in July.

There has been an understandable tendency to dismantle the party.

For some time it has felt as if Labor was on track to defeat the SNP in the next Holyrood election and devolve power after 19 years in opposition.

Latest opinion poll Raises questions on that analysis.

It appears that Labour’s “change” mantra in the general election is really taking advantage of the public’s appetite and it is entirely possible that they could win.

The point is that a change of government at Holyrood is not inevitable. The SNP will fight and remain a political force.

The budgeting process is a good demonstration of how smart they can be.

In late October, UK Chancellor Rachel Reeves helped put Labor on the front foot in Scotland by announcing a substantial increase in funding for the SNP government this year and next.

As I said at the timeThis opened up political space for Labor to focus on the delivery of better public services in Scotland (under SNP administration since 2007).

With the publication of the draft Scottish budget this week, the SNP has managed to take back some of the political initiative.

It has happily borrowed £1.5bn of extra spending from the UK Treasury this year and an extra £3.4bn next year.

Most of this is spent on paying the NHS, social welfare and public sector wage bills.

However, the SNP has managed to direct some of that cash towards policy priorities that increase political pressure on Labour.

The Scottish Government has promised Partial cut in winter fuel payment For older people who are not getting pension credit.

These cuts were introduced by the UK Government and are being matched by the Scottish Government this winter before new payments are introduced next year.

It has also promised to end the two-child limit on access to benefits in Scotland, which Scottish Labor has previously expressed a desire to achieve.

It is clear that this policy was added very late to the budget statement. Its full cost has not been realized yet. The Scottish Fiscal Commission’s rough estimate is £150m in the first year and has described the policy as a “fiscal risk”.

Scottish Labor leader Anas Sarwar initially dismissed the SNP’s idea as “a policy without money” because the first tranche of payments is not in the 2025/26 budget.

SNP ministers are proposing to make the changes from spring 2026, just before the Holyrood elections.

However, they insist there is £3 million in their budget plans to make the necessary preparations.

They have formally requested assistance from the UK Department for Work and Pensions (DWP) to access the data needed to establish who will be eligible for the extra cash.

They may also require the UK Government to change the law so that any extra money paid in Scotland is not clawed back by any other part of the system.

The DWP has said it will “engage constructively with the Scottish Government where necessary” – which may or may not be an expression of willingness to assist.

On Thursday, Prime Minister Sir Keir Starmer said scrapping the two-child limit was not a “silver bullet” to tackle child poverty and that the policy could not be implemented across the UK.

On Friday, he held private talks with John Swinney in Edinburgh, after which Mr Swinney said the PM had agreed to work with him on the two-child limit.

Having re-established ties with devolved governments since taking power at Westminster, Labour’s commitment to partnership politics is now being tested by the SNP.

At Holyrood, Scottish Labor also faces a budget dilemma. It is entirely entitled to criticize the SNP’s approach to taxation and public spending.

The question is, can Labor not support a Scottish budget that includes winter fuel cash for pensioners and a route to scrapping the two-child limit?

The SNP is not counting on their votes, but if it doesn’t get the votes, it will never tire of reminding voters what Labor has decided not to support.

In that respect, this is a politically savvy budget from John Swinney’s administration.

It also includes policy suggestions from the Greens, Liberal Democrats and the Alba Party, who are more likely allies.

There is no hope of Conservative support. They strongly oppose the SNP’s approach to taxation, whereby higher earners have to pay more than in England to raise additional money for public spending.

All parties know a budget agreement is needed before a key vote in February.

Otherwise there could be chaos in the distribution of public funds to pay the bills and meet the salary increases promised to civil servants.

It is not clear whether any party would want to risk being held responsible or the prospect of an early election at Holyrood.