ALTHOUGH it feels like an age ago, it was only October when Theresa May announced that austerity was supposedly over. At the UK Budget, only a few weeks later, “austerity is over” became austerity “is coming to an end”. Only time will tell whether even this watered-down pledge will become a mirage.

Indeed, it remains to be seen whether it will survive the chaos of Brexit given that we have no idea what the UK public finances will look like in a few months’ time, never mind a few years.

Derek MacKay therefore has a tough job today when he stands up to deliver his draft tax and spending plans for 2019/20.

Over the last couple of budgets the Scottish Government has rightly used its tax powers already, meaning that we have more public funding to spend than we would otherwise have. Nonetheless, due to UK Government spending decisions, Scotland’s Budget still looks very tight, both now and into the future.

While the NHS will see much needed increases in funding, stemming from increases in the rest of the UK, other non-protected budgets in Scotland can expect to remain under significant pressure. Indeed, these budgets – which fund things like social work, colleges, schools, and prisons – may still face cuts. So for these vital services at least, without further action, austerity may not be over. But while ending austerity is incredibly important, and can’t come soon enough, it’s actually quite a low bar.

Here in Scotland we have set ourselves higher ambitions. The Scottish Government’s priorities, and often those of the Scottish Parliament, are not just about stopping the damage to our public services that we’ve seen across the UK for most of the last decade. Instead, we have ambitions to do better, eradicating child poverty, narrowing the attainment gap in schools, delivering fair access in our universities, and creating a more inclusive economy.

However, the scale of these ambitions will need to be matched by a similar scale of action. To end austerity we might need increases in tax revenue over the next few years. To meet these higher ambitions we almost certainly will.

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So what can Derek MacKay do?

Most importantly, he can try to drive more inclusive economic growth to narrow inequalities, boost pay and profits, and increase tax revenue. But in the short-term levels of public funding will be determined by Scotland’s tax levels.

IPPR Scotland has examined some of the options available through changes to income tax in Scotland. We looked at where the higher rate tax threshold is set in Scotland – the point at which the top 15% of earners in Scotland currently begin to pay a higher rate of tax.

We found that matching the UK Government’s tax cut for higher earners here in Scotland would be hugely expensive, costing over £1 billion over the next four years alone. Each year this would see spending in non-protected departments reduced by 2% – something we can’t afford after years of austerity.

However, we also found that by freezing the higher rate threshold in cash terms, we could actually raise £90 million next year and up to £210m by 2022/23. Because of increases in other tax bands this would still mean that tax payers pay less next year compared to this, in cash terms. And it would also still see over half of Scottish tax payers pay less than their counterparts in the rest of the UK.

So what could investing these additional funds mean in reality? It could mean 2200 more teachers in our schools, or 2800 more nurses next year. Meanwhile, looking ahead to 2022/23, it could mean an additional 5200 teachers or 6500 nurses each year.

Similarly, if these funds were invested in anti-poverty measures, on top of the £125m that the Scottish Government rightly already invests, we could take an additional 40,000 children out of poverty by 2021/22.

These kinds of investments would be far more ambitious than merely ending spending cuts. They would be a sign that Scotland is rebuilding after almost a decade of austerity. Unlike the UK Government, not jam tomorrow, but action today.

Ultimately, the best way to measure whether a decision is radical is whether it makes a radical difference to people’s lives. If we are to do more than simply ending the damage of the last decade of austerity in Scotland, we will need radical action to deliver radical impact each and every year, so that we can begin to deliver against the high ambitions we’ve set ourselves.

Russell Gunson is director of IPPR Scotland