Budget Resolutions and Economic Situation

Gavin Newlands Excerpts

Tuesday 21st March 2023 Commons Chamber

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

Welcome measures in the Budget include enhanced tax relief rates for some life sciences research and development-focused SMEs, to help incentivise investment in R&D, and the extension of the reduced fuel duty rate has been welcomed by the logistics and haulage industries. Among the not-so-welcome measures is the 10.1% tax hike on Scotch whisky, meaning that on the sale of an average £15.22 bottle, £11.40 will be taken to the Treasury through tax. This is an enormous blow for the spirits industry, significantly reducing its already tight profit margins in a move that the Scotch Whisky Association has noted breaks previous ministerial commitments to review alcohol duty to ensure that the tax system supports Scottish whisky.

In a post-Brexit context, protecting businesses and positioning them in the best possible way is of vital importance when it comes to successful trade deals. We need trade deals that will allow UK industries to prosper and thrive for the benefit of the economy and the public, but that cannot happen if domestic policies are strangling industries. On that note, I welcome the addition of several new sectors to the shortage occupation list, which will help with managing labour shortages in those areas, but reform is still needed to the scheme if it is to be as effective as we need it to be. The hospitality sector, for example, is crying out for support and it needs to be included in the scheme.

For my constituents, though, the cost of living remains the No. 1 concern. The Chancellor’s fiscal policies are still not going far enough to provide households with the support they so desperately need. While he is extending the price cap guarantee, the actual practical financial support is being withdrawn. That means that average households will see a £400 a year increase in their energy costs, which is an increase that many cannot afford. Nationally, around 30% of households could not afford to put the heating on over the winter months; in my constituency it was 45%. Someone who has not lived in poverty and faced these struggles daily cannot truly understand what that means day to day, or what worrying about how they will pay the bills, feed their children and put a roof over their heads does to a person. Statistics cannot paint the picture entirely, but they give a flavour. Nationally, 41% of people said that their mental health had worsened as a result of the cost of living crisis, and in my constituency it was much higher at 55%.

Pensioners, too, were left behind in this Budget. What is essentially a hefty tax cut for a very small number of very wealthy retirees is not enough. Although the state pension is being uprated in line with inflation, it is still not keeping up with living costs. Our main concern, though, is that the Government are considering increasing the state pension age again. Against the backdrop of all this, life expectancy is stagnating, and even falling in deprived communities. We are still waiting for justice for the Women Against State Pension Inequality Campaign, which is a perfect example of why now is not the right time to be making this change, as I hope Ministers will recognise.

We all know there is not an unlimited pot of money to finance everything we would like the Chancellor to announce in an ideal world. However, with living standards so low and with so many households struggling across Scotland and the UK, the Budget could have done more to support the public this Government serve.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

rose—

[Margaret Greenwood (Wirral West) (Lab)]

rose—

--- Later in debate ---

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

Last week should have seen a Budget that embraces the idea that moving to net zero and decarbonising our economy and society is an opportunity to rebalance our economy and recognise that the old platitudes and ideologies no longer work. Instead, we saw the same mistakes, the same retrenchment and the same failures that have dragged the UK ever closer to the bottom of the pile, and the same determination to continue down a path that is disastrous not only for our society but for our planet.

Last week, England’s active travel budget was slashed to the bone. Active Travel England is being neutered before it has even begun. This financial year will see active travel spending in Scotland reach a transformational £30 per person. In contrast, England, outside Greater London, will receive less than £1 per person per year. For those sitting on the Treasury Bench who are not too good at arithmetic, that is 30 times less than in Scotland. The priorities are clear: inertia from the UK Government or investment in our communities by the Scottish Government.

Meanwhile, the UK Government pledged to drop billions into the black hole of nuclear power, surely the least sustainable energy there is. Despite the potential of fuels such as green hydrogen and tidal to reduce our dependence on fossil fuels, alongside the known quantities of hydro and wind, we will see another wave of massively subsidised nuclear power stations, all presumably to be cleaned up by our children and grandchildren. In trying to justify not giving free school meals to those in need, or slashing transport funding outside London, the Tories claim they do not want future generations to pay the price for our financial profligacy, but they are more than happy to bequeath to those same future generations the cost and danger of dealing with our toxic waste.

The Government’s desperation to cling to the past is not limited to energy, as is apparent from their attitude to the railway and the failure of their free-market doctrine, with another six-month extension for Avanti, a train operator that can barely run a train. There are five state-supported rail operators in Scotland, and two of them—ScotRail and London North Eastern Railway—are run by the state for public benefit. One more will join them in June, when the Caledonian sleeper returns to public ownership. Only Avanti and TransPennine Express, two of the worst train operators in these isles, will remain as contracted operators.

If we are serious about sustainable economic growth, we need public transport and transport infrastructure fit for the 21st century, not the 19th century. There has been a sea change in rail in Scotland since devolution, driven by Governments of all political colours, except the Tories, of course. We have seen electrification and decarbonisation right across the country, and Scotland’s rail network will be fully decarbonised by 2035, which is some achievement for a rail network that was ignored by this place for decades. In contrast, the last decade of rail investment south of the border has been a sorry tale of delay, incompetence and hard political ideology, which has meant virtually zero progress on modernising the network anywhere outside the M25.

Public charge points are being rolled out by the UK Government at a glacial pace, in a scheme ironically called Project Rapid, which has seen the Government fall 200,000 short of their 300,000 target by 2030. That target is utterly imperative. Scotland has ordered 11 times more zero-emission buses per head than England. I could go on.

Did we see any new funding or action in the Budget to show any sign that the Chancellor and his colleagues understand the gravity of the situation? Not a sniff. This Budget was another missed opportunity, following the last 13 years of torpor and decline. It shows zero understanding of the fundamental and, to be blunt, existential challenges our society faces. The transition to net zero is a golden opportunity to revitalise communities and our economy. The UK and its failed economic strategy should get out of the way of Scotland’s aspirations to be a net zero nation and a world leader in decarbonisation. It is clearer than ever that those aspirations will be met only through independence.