Autumn Statement 2014: Scotland's NHS 'to get £125m boost'

Scotland's NHS will get a £125 million boost as a result of staying in the UK, while independence could have left the country facing a £12 billion black hole in its budget, a UK Government minister said.

Scottish Secretary Alistair Carmichael said the recent fall in the value of oil means that if Scotland had voted to leave the UK it could have been facing a spending gap about the same size as the entire budget for the health service north of the border.

He was speaking ahead of George Osborne's Autumn Statement, during which the Chancellor is expected to announce more funding for the NHS along with the expected devolution of corporation tax to Northern Ireland, but not to Scotland.

The SNP has called on Mr Osborne to use his statement to pledge early action to implement the recommendations of the Smith Commission on further devolution.

A very different future

The Commission, which was set up by the UK Government immediately after the independence referendum, last week called for Holyrood to get powers to set income tax rates and bands, along with new powers over benefits.

Mr Carmichael claimed the fall in oil prices would have meant "a very different and much more difficult future" if Scotland had voted to leave the UK.

He said Scottish Government plans for independence were based on an oil price of 110 US dollars (£70.30) a barrel, but yesterday that price was just 72 US dollars (£46).

This could have resulted in a near-£12 billion gap in the Scottish budget from 2016 to 2019, according to the Scotland Office.

Mr Carmichael said: "Falling oil prices combined with the Scottish Government's wildly optimistic production figures would have blown a massive hole in the middle of the finances of an independent Scotland.

"Thankfully the people of Scotland shut the door on the independence option and chose a united future with the rest of the UK.

"The benefits of that choice are already clear to see. The Autumn Statement is expected to deliver an extra £125 million for Scotland's NHS. While the latest oil price would have left an independent Scotland missing another £11.8 billion over the next few years, the same as the total annual health budget for Scotland."

One of the most powerful devolved parliaments

Mr Carmichael also said the Smith Commission recommendations meant "the promise of extra powers for the Scottish Parliament is on track".

He said: "We have an all-party agreement on the way forward that will make Holyrood one of the most powerful devolved parliaments in the world.

"The right decision by the people of Scotland in September is already making a world of difference to Scotland's NHS. Our health service is stronger when we share financial risks across the whole of the UK and take more decisions here in Scotland."

But new SNP depute leader Stewart Hosie said the Chancellor must use his Autumn Statement to "explain why he has failed to meet a single one of the economic targets he set himself when the Tories came to power four years ago".

Mr Hosie, the party's Treasury spokesman at Westminster, said: "Despite promising recovery all we have had is austerity from the broken promises Chancellor. In his Budget this spring, he brought us news that debt will not fall until 2016/17 and that he doesn't expect the UK current account to be back in the black until 2017/18.

"He also announced he had failed to keep public sector debt down - at £70 billion, borrowing in 2015/16 forecast to be more than three times his 2010 estimate.

"Time is running out for Mr Osborne. He must use his statement to explain why he has failed to deliver growth - and instead lined the UK up for some £75 billion of further pain at the hands of his austerity agenda."

Undo the Westminster damage

Mr Hosie added: "The Scottish Government is doing all it can to undo the damage of Westminster cuts with the powers we currently have. And it is delivering results, with record rates of employment and two years of continuous economic growth.

"But Westminster is standing in the way of our efforts to tackle economic inequalities in Scotland. While the Smith Commission did not recommend the job creating powers Scotland needs to thrive, implementation of the proposals will help the Scottish Government take further action to undo the damage of austerity.

"For this reason, Mr Osborne must commit to their swift implementation during his statement.

"Next May, the Scottish people will deliver their verdict on Mr Osborne's time as Chancellor. As his austerity agenda continues to inflict pain across the country and his list of broken promises grows longer, Mr Osborne is rapidly running out of time to redeem himself."

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