Page last updated at 19:06 GMT, Tuesday, 3 February 2009

Deal done to save Scottish budget

Holyrood chamber
The government hopes to pass its budget at Holyrood on Wednesday

The Scottish Government has secured enough support to pass its budget for the coming year, after striking a deal with the Liberal Democrats.

In return for the party's backing, ministers have agreed to take forward a strategy for boosting the economy.

The minority government now hopes its 33bn spending plans can be passed on Wednesday, in the wake of their rejection by MSPs last week.

Tory backing will give the SNP enough votes to pass the Budget Bill.

The agreement was reached after Labour, the Liberal Democrats and the Greens combined to vote down the budget in parliament last week, saying it would fail to help the Scottish economy through the current tough times.

We need to bring into the discussions about public expenditure, input from other political parties
John Swinney
Scottish finance secretary

Ministers agreed to Lib Dem demands to make a submission to the Calman Commission on borrowing powers for the Scottish Parliament.

The SNP has been highly critical of the commission, which is reviewing devolution 10 years on, because it has ruled out looking at independence.

The government also backed Lib Dem calls for a finance sector jobs task force and a review of Scottish public spending.

And ministers made a commitment to commission new school building projects this year, under its Scottish Futures Trust alternative to PPP/PFI funding.

Scottish Finance Secretary John Swinney, who said it was "a bit of a shock" not to get the budget through last week, described the move as an "important development in the politics of the Scottish Parliament".

Cabinet meeting

"There's a big change involved in this agreement, because what we've done is we've accepted we need to bring into the discussions about public expenditure, input from other political parties and with some external input," he told BBC Scotland.

"I think that's in the spirit of a government acting without a majority."

Scottish Liberal Democrat leader Tavish Scott said: "We have a package for the long-term that can help tackle the economic difficulties the country is in.

"It's about building the new schools we need in Scotland, it's about helping local government and it's about making sure we can fund, in new ways, the [new] Forth Road Bridge and make sure no transport projects are under threat."

Meanwhile, ministers said they were looking for the broadest possible support for the budget, and has made offers to Labour, which has demanded 15,600 new apprenticeships over two years, and the Greens, who have asked for a 100m-a-year scheme for free home insulation.

It is thought Labour will be offered a lesser deal.

On Wednesday, MSPs will be asked to approve emergency measures to take all three scrutiny stages of the Budget Bill in a day, culminating in the final, crunch vote at 1700 GMT.

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