Treasury Spending: Grants to Devolved Institutions

Debate between Kirsty Blackman and Chris Elmore

Tuesday 3rd July 2018 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

I thank the Backbench Business Committee for agreeing to schedule this debate, and I thank my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald) for making the application and all the Members from across the House who agreed to back it. My hon. Friend is unwell today, which is why I am here in his place; I hope that Members understand.

As the House would expect, I shall mainly focus my comments on the Scottish context, but I wish first to touch on the other devolved institutions. My Welsh colleagues have often expressed their concerns about how the Barnett formula applies to Wales. The issue was further compounded by the recent cancelling of the Swansea tidal lagoon project, which would have generated significant income for Wales. The reality is that Wales has been badly served by the UK Government.

On Northern Ireland, the main estimates include £410 million arising from the confidence and supply agreement. The SNP has stressed on numerous occasions how shocking it is that the Prime Minister has entered into this grubby deal, giving huge amounts of cash to Northern Ireland just to keep herself and her Government in power. But the biggest problem about the whole deal—apart from the fact that the Tories, with whom we fundamentally disagree, are being propped up by the Democratic Unionist party, with which we have even more fundamental disagreements—is that the money does not generate Barnett consequentials. If Northern Ireland is receiving £1 billion, Scotland should receive £2.9 billion and Wales £1.6 billion. Given that Scotland’s discretionary budget has been cut by 8.1%, or by £2.6 billion, between 2010-11 and 2019-20, I hope that the UK Government will understand why the people of Scotland and of Wales are so deeply unimpressed by their behaviour.

[Chris Elmore (Ogmore) (Lab)]

In addition to the provision of the DUP bung, Wales has lost £1.2 billion, or 7%, since 2010, so we are talking about a 7% real- terms cut. Despite that and despite the myths peddled by the Government, health and social care spending in Wales is still higher per head of population than in England. Does the hon. Lady agree that we should talk in facts and that the real-terms cuts happening in Wales and Scotland are having a real impact on people’s lives?

[Kirsty Blackman]

I agree. What we should be doing in this debate, and what I will try to do in this debate, is to lay out what the real-terms cuts actually are. We cannot have constant fudge from the UK Government, whether on the Wales budget or on the Scotland budget. We need to be accurate about how much is being cut from these budgets.

Scotland’s fiscal resource budget has seen a cut of 9.1% over this period, and our total fiscal budget will be cut by 8.4% in real terms. The UK Government have been talking about the Barnett consequentials that are coming to Scotland, but the reality is that most of that money is financial transactions money. Financial transactions cannot be spent on normal day-to-day spending. They cannot be spent on resources for our NHS, for example, because they have to be paid back. This is not real money that the Scottish Government can spend.

We are also seeing a £230 million resource cut in 2018-19, but despite that, the SNP Government at Holyrood continue to protect public services and to invest in measures to unlock innovation and drive increased productivity. On policing, unlike the UK Government, we have not cut the numbers of police. At this point, I would like to congratulate the new Scottish Justice Minister, Humza Yousaf. It is possible that Donald Trump will visit Scotland. I am certainly not a big fan of Donald Trump coming to Scotland, but I am pleased that Humza Yousaf has managed to convince the UK Treasury—I thank the Minister for doing this—to provide an extra £5 million to cover the cost of rolling out the red carpet. I do not want Donald Trump to come here anyway, but he has had the hand of welcome extended to him by the Prime Minister, so it is completely reasonable that the UK Government should cover this cost.