Nationalists have launched a fresh assault on Labour over Chancellor Alistair Darling's budget plans.

SNP backbencher Alex Neil challenged Labour to say what services should be cut to meet a requirement for £500 million savings demanded by the Treasury.

Mr Neil said: "Despite setting up a three year-budget the UK Government's decision to take £500m off the tightest financial settlement ever for a Scottish Government means spending will have to be reduced somewhere.

"So far Labour has been decidedly quiet on what services would face the axe to meet Gordon Brown's debts.The Scottish Government put forward responsible plans and won parliamentary approval to spend Scotland's budget allocation over three years.

"For the UK Government to then come in and take £500m off that three-year deal is a deep disappointment.

"With Labour so eager to accept this budget cut, let them come forward with their plans to axe £500m from Scotland's public budget."

Mr Neil said the cut required was either the equivalent of the entire affordable homes budget, half of Scotland's universities budget or the total cost of smaller allocations to a number of commitments including, schools, climate change and free central heating programmes.

Labour in turn praised Prime Minister Gordon Brown for "saving" the Scottish financial sector and providing help for families and the elderly, while stating the NHS budget had record increases.

Dr Simpson said financial details obtained under Freedom of information laws showed £500m of savings required by health boards over the next three years.

Richard Simpson, Labour's health spokesman, said £154m was to be cut in 2008-09, £160m in 2009-10 and £200m in 2010-11, from frontline services as well as administration functions.

These savings are being made in frontline services as well as in bureaucracy and back-office functions.

Dr Simpson said: "Alex Neil has got his priorities badly wrong and he should apologise. If he really cared about public services he would demand that the SNP reverse its decision to impose cuts of £500m on the NHS.

"Gordon Brown is providing the NHS in England with record spending increases of 6.7% year-on-year. Will the SNP explain why they are refusing to pass this money on to the health service in Scotland?

"When times are hard we need a government that will stand up for the NHS and other public services. Under the SNP we have seen the return of bed blocking, an increase in cancer waiting times and rising numbers of C. diff cases.

"The SNP are a government and they have to start taking some responsibility."

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