Financial Implications for the Next Generation

David Linden Excerpts

Tuesday 4th December 2018 Westminster Hall

[David Linden (Glasgow East) (SNP)]

As always, it is a pleasure to see you in the Chair, Mr Hollobone. I am reliably informed by WhatsApp that Divisions are imminent, so although we have a degree of flexibility, I will try to be mindful of that. I warmly congratulate the hon. Member for South Dorset (Richard Drax) on securing the debate.

I sometimes come to these debates feeling a bit like William Hague. The Order Paper says that the debate is about the financial implications for the next generation, but I realise that I am probably the youngest Member in the Chamber at the moment. I do not want to sound like William Hague by saying, “It’s all right for you: you won’t be here in 40 years’ time,” but in reality, hon. Members will not.

It is somewhat remarkable that the hon. Member for South Dorset managed a good 15 minutes or so without touching on Brexit, because the reality is that Brexit is the biggest financial threat to the next generation. As I will touch on, it will cost each person £1,600 by 2030. I will also touch on what we are doing at home in Scotland to support first-time buyers, and on the recent Sustainable Growth Commission report.

Opportunities for young people, such as the freedom of movement and the ability to study abroad, will be severely limited as a result of Brexit. All those things are helpful in terms of social mobility and increasing people’s spending power. The Scottish Government’s analysis found that, by 2030, GDP would be £9 billion lower under a free trade agreement than if we had stayed in the EU. Of course, that decision was expressed by the people of Scotland, 62% of whom voted to remain in the EU. That £9 billion is the equivalent of £1,600 per person in Scotland. That is deeply disappointing, although we see that in the main Chamber the UK Government are still refusing to admit the true cost of Brexit, with the Treasury analysis not covering the Prime Minister’s deal; it covered no deal, the European Free Trade Association, the European economic area, the situation without a customs union, and Chequers. This is all quite important for the country’s direction of travel in terms of our finances and what we will leave to the next generation.

The Bank of England’s analysis suggests that the Prime Minister’s deal, which is clearly about as popular in this House as a cup of cold sick, will take between 1.25% and 3% from GDP by 2023, with a no-deal Brexit cutting between 7.75% and 10.5%. So the idea that we can have a debate about the financial threat to the next generation and ignore these figures really beggars belief.

I also want to touch on what we are doing in my own country to make sure that we have an economy for future generations. Some of it is about what we are doing to invest in housing. I remain incredibly concerned, almost as an observer down here, about the fact that the UK Government do not necessarily see the need to invest in social housing. There are things that they are doing around stamp duty, but stamp duty limits for £500,000? I do not know a huge number of 27-year-olds who are able to go and lump down £50,000 for their first home. There is some good stuff being done in Scotland, which I commend to the Minister, about what we can do to invest in housing while also ensuring that young people can get on the property ladder.

Finally, I will touch on the issue of the growth commission, whose report was published by Andrew Wilson on behalf of the Scottish Government. That report looks at the finances of an independent Scotland, and what it is absolutely clear about is that an independent Scotland can leave behind the broken economic model of the UK and actually benefit future generations with inclusive, sustainable growth. I will finish with this point: if the approach to spending recommended by the commission had been applied by the Westminster Government over the past decade, the £2.6 billion in real-terms cuts to Scotland would have been completely wiped out.

So I commend the hon. Member for South Dorset for initiating this debate. It is very difficult to have a debate such as this one, about the next generation, when we are quite literally pulling the rug from under their feet by the retrograde step of leaving the European Union and denying them the right to love and live elsewhere, and the opportunity to get on in the world.