A forthcoming Labour administration is set to empower the Scottish Office with a £150m resource to tackle poverty directly.

Scottish Secretary, Ian Murray, who is expected to lead the office, will be entrusted with the levelling up funding to allocate to councils independently of SNP government approval.

He stated: “Labour will diminish poverty by augmenting our economy and ensuring that employment is rewarded. This funding will facilitate job creation across the country and present opportunities throughout Scotland, particularly in disadvantaged communities that have been overlooked by both the Tories and the SNP for too long.”

The Levelling up fund, which is currently under the responsibility of Michael Gove’s governmental department, was established following the UK’s departure from the EU.

Since 2021, numerous projects across the UK have been awarded billions of pounds, with the second round amounting to £177m for Scotland.

However, today’s Labour manifesto, launched by leader Keir Starmer, will advocate for a significant overhaul of the system.

Over £150m will be directly allocated to the Scotland Office for distribution across Glasgow and throughout Scotland. Thereby transforming the Scotland Office into a fully-fledged spending department with substantial fiscal strength.

The funding will specifically focus on deprived areas, with an emphasis on reducing poverty, creating employment opportunities, and stimulating economic growth.

Labour MP Ian Murray
Labour MP Ian Murray
(Image: Lesley Martin/PA Wire)

Murray, who holds prominent position in Starmer’s shadow cabinet, is broadly expected to become Scottish Secretary following the election. He will authorise the allocation of the funding if appointed to the lead team.

In speaking to the Record, he noted: “If Labour is bestowed with the honor of forming the next UK Government, we will accelerate the functioning of the Scotland Office, giving it a mandate to generate jobs and stimulate growth. It will deliver the change Scotland requires.”

“That involves promoting Scotland’s world-class produce, products, and services globally, to amplify exports and drive investment. Scotland is a phenomenal country, and we aim to market our nation to the world.”

“We will ensure that the government delivers for Scotland – such as launching GB Energy, with its headquarters located in Scotland, creating approximately 69,000 jobs, reducing bills, and guaranteeing our energy security for years to come.”

Furthermore, The Scotland Office will manage investment in Scotland to generate jobs, facilitate economic growth, and decrease poverty throughout Scotland.”

Scepticism exists among SNP figures around the functioning of the levelling up funds in recent years.

They suspect the so-called “slush fund” has been targeted towards Tory-held constituencies with the aim of benefiting incumbent MPs’ likelihoods of re-election.

Nationalists also contend that this funding should be overseen by Holyrood, rather than Westminster.

Moreover, the manifesto will reassert previous commitments to eliminate the non-dom tax status, introduce VAT on private school fees, establish GB Energy, and enhance workers’ rights.

Speaking ahead of its launch, Starmer reiterated that economic growth was a prime priority for his party.

He affirmed: “Some argue that how you grow the economy is not a central question – that it’s not about how you create wealth, but how you tax it, how you spend it, how you slice the cake and that’s all that is of importance.

“To make our stance crystal clear – this manifesto fundamentally rejects this contention because it centres around transforming the nature of the jobs market, changing the infrastructure that supports investment into our economy, reforming planning and unlocking the potential of several projects. These steps alone have far-reaching implications for our long-term growth potential.”

If we could grow the economy on a scale similar to the last Labour Government, we could realise an additional £70bn worth of investment for public services.”

“Wealth creation is our number one priority. Growth is our core business – it’s the objective and the method of national renewal. The mandate we seek from Britain at this election is for economic growth.”

Green MSP Ross Greer said: "Additional funding for Scotland is unequivocally necessary to compensate for 14 years of Tory budget cuts. However, the allocation of these funds should be decided by Scotland’s elected Parliament and Government, not by Westminster.

"Levelling Up funding has been disproportionately designated to constituencies held by Tory MPs rather than the economically deprived communities in dire need. This partial approach can’t be replicated under a Starmer administration.”

If the Labour Party’s priorities focus on combating poverty and creating jobs, they could achieve considerably more by abandoning their commitment to adhere to the Tories’ overarching spending plans.

"Scotland direly needs investment, not constrictive cuts to essential public services coupled with minor targeted spending initiatives.”