Assume that Labour and the SNP collectively hold enough seats to form a majority.
If Labour can make the assumption that the SNP will, of their own accord, choose not to bring down a Labour government then do they lose anything by not having a formal confidence and supply arrangement? Given the blame that would be heaped upon the SNP if their action or inaction were to bring about a Tory government, Labour can draw a fairly safe conclusion that the SNP will vote in exactly the way they would if a formal C&S agreement were in place (i.e. they will vote for Labour's Queen's speech and help pass its budgets). This could be understood as a kind of tacit agreement based on the bargaining position and self-interest of both parties.
Am I misunderstanding something?