Anas Sarwar has appealed to voters to give Labour five years “to fix the Scottish National party’s mess” as he pledged more homes, tax cuts and a smaller public sector.

The Scottish Labour leader is fighting a last-ditch attempt to reverse a steep slump in support. Recent polls put Sarwar’s party third or even fourth behind the SNP, Reform and the Scottish Greens, dragged down by the UK government’s unpopularity.

He said Labour still had time to claw its way back into contention before the 7 May Holyrood election, claiming voters would see the SNP government of John Swinney as “tired, full of excuses and out of ideas”.

Sarwar said people “could see that quite clearly” during the first televised leaders’ debate on Sunday, as he unveiled Labour’s manifesto in Edinburgh.

“I am confident that the more people see the choice at this election, and the more they come alive to this election campaign, they will choose change on 7 May,” he said.

Sarwar made no reference to Keir Starmer, or UK policies, as he laid out a series of election pledges to provide families with a £3,000 childcare tax break, lift property taxes for first-time buyers and build 52,300 affordable homes, while hiring 2,000 extra teachers to increase literacy and numeracy.

With less than 25 days until the election, the party still hopes to capitalise on polls that also show a large majority of Scottish voters are critical of public services under the SNP, by making Labour the vehicle for that discontent.

“After 20 years of the SNP they have lost their way,” Sarwar told the rally on Monday. “They have been given 20 years. I am asking you to give me five; five years to fix the SNP’s mess. The people who created the mess cannot be the ones to fix it.”

Facing heavy competition for votes on the centre left in Scotland, and seeing the Conservatives tacking to the right as they struggle to compete with Reform UK, Scottish Labour has shifted its economic policies firmly into the centre.

Scottish Labour had previously pressed for a more progressive income tax regime in Scotland, using the country’s devolved tax system. Sarwar said the party now aspired to reduce tax rates, and particularly target middle earners paying significantly higher marginal rates, when Scotland’s finances allowed, as well as cutting business rates.

Labour would cut the country’s quangos by a third, heavily streamline NHS bureaucracy, host a unit in a new Scottish Treasury to cut public sector waste and introduce a board of trade to prioritise private investment, he said.

The party would also build new nuclear power stations, scrapping the SNP’s longstanding ban on the technology, and greatly streamline the planning system to speed up developments, Sarwar added, winning plaudits on Monday from the business lobby group CBI Scotland.

Labour claims its public sector cuts, strengthened investment agencies and greater investment in new technologies, including Scotland’s first NHS appointments app and AI-driven diagnostics in the NHS, will free up hundreds of millions to invest in better schools, hospitals and local services.

The manifesto was given cautious approval by the Institute for Fiscal Studies, which said its “relatively restrained” proposals and lack of expensive, uncosted promises were sensible and less risky than those of Labour’s rivals.

David Phillips, the head of devolved and local government finances at the thinktank, said: “Particularly given the fiscal situation, the lack of big unfunded new commitments is welcome.”

Even so, Labour would need to cut some services because spending increases on core areas were unavoidable.

Despite Sarwar’s confidence, the anti-independence campaign group Scotland in Union published a tactical voting guide that urged Labour, Tory and Liberal Democrat voters to back whichever party stood the best chance of blocking an SNP candidate from winning a local constituency.

Angus Robertson, the SNP’s campaign director, said: “We’ve heard it all before from Labour – but we know exactly what we get with them. Broken promise after broken promise – energy bills up, Grangemouth closed and the winter fuel payment debacle. We already have one disastrous Labour government and we don’t need another one.”