Budget Resolutions and Economic Situation

Ian Blackford Excerpts

Wednesday 3rd March 2021 Commons Chamber

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

I should thank the Chancellor for advance sight of his statement but, of course, much of it—against the usual protocol—has already been leaked to the media. It is perhaps worth stating that what is contained in the Budget should be announced in this House and should not be pre-announced in the media.

The Budget comes at a critical moment—a moment when people right across these islands can have faith that the end of the pandemic is finally in sight. Just as millions of people are now being injected with the hope of the vaccine, this Budget should have injected the economy with the stimulus package that it desperately needs.

The Institute for Public Policy Research advised the Government to “boost...like Biden”, to generate an investment-led recovery. Instead, the Chancellor has produced a Budget that offers people the bare minimum— a Budget that completely fails to take responsibility for the bollocks that they have made of Brexit. Indeed, when we look at the Office for Budget Responsibility forecasts and the years 2023, 2024 and 2025, we see a forecast of 1.7%, 1.6% and 1.7% growth. Where is the ambition? This is a Budget that has a poverty of ambition.

When we contrast the response of the US Administration in that fiscal stimulus of President Biden and put that in a historical context, what we see, over the course of the last decade, is that US GDP growth has been 10% greater than that of the UK, and it is that failure to deliver growth that is imperilling our national finances. It is that lack of ability to deliver growth that holds back tax receipts. It is that lack of ability to deliver growth that constrains the opportunities for people, that holds back the growth in productivity, that holds back the growth in wages, that leaves so many of our people living in poverty.

Between the lines of the statement today, there were also the surest of signals. The conversion of this Prime Minister and this Chancellor to increase public spending was only ever temporary. Today, we have a Tory Chancellor returning to type. He is clearly itching to turn off the state spending taps. This Budget is carefully laying the ground for more Tory austerity, a decade more of Conservative cuts, because the Tories do not regret—[Interruption.] I can see the Chancellor shaking his head, but he had the opportunity today to continue the £20 uplift to universal credit and make it permanent—and not just make that permanent to give some hope for those who depend on universal credit, but to extend it to legacy benefits. What did we get instead? We got a commitment to contain it—to leave it in place—for a further six months. In other words, when the restrictions on lockdown have come off, the £20 uplift to universal credit comes off as well. Where is the compassion and dignity for those who need that support? They will continue to need that support right after we come out of this crisis. That is the Tory party that has reverted to type.

Of course, the Tories do not regret the austerity that they have inflicted over the last decade. They are nostalgic for it. We are told by the Chancellor that there have to be cuts to spending. We are told that there have to be tax increases, but we know that he is deliberately setting out a false choice, because we heard nothing today about the need not just here, but right around the world to create the circumstances for investment-led growth. Where is the agenda that the UK is going to take to the G7 to make sure that we work collectively to deliver a better future for everybody out of this pandemic? Every credible economist knows that to protect and secure the public finances, we must create the circumstances for recovery for growth and that this has to be investment-led.



As we look forward to the months ahead, we need to deliver a vision of a better future and we need leadership to do this. So, for the people of Scotland this Budget comes at a critical moment of choice. Post-Brexit and post-pandemic, Scotland now has a choice of two futures: the long-term damage of Brexit and more Tory austerity cuts, or the opportunity to protect our place in Europe and to build a strong, fair and green recovery with independence. This May, every citizen will cast their democratic decision on who they trust to rebuild our society and our economy in the wake of the pandemic. It will be a clear choice: Scotland’s future in Scotland’s hands, or in the hands of the Tories and this Prime Minister and Chancellor. Let’s just say that we are looking forward to the verdict of the Scottish people.

Let me turn to the immediate priorities that this Budget should have dealt with. I am sorry to say that the Chancellor stood up today and doubled down on exactly the same mistakes that he has been making throughout the pandemic. Temporary extensions and temporary support can only ever mean a temporary reprieve for those millions who have been crippled by uncertainty for months. The Chancellor’s temporary timelines for pandemic financial support completely contradict his own Government’s policy. On the one hand, the UK Government rightly tell people that they will follow data not dates when it comes to public health, but when it comes to financial support, Tory policy is defined by dates, deadlines and cliff edges.

Businesses and workers on furlough needed certainty last March and last autumn, and they need it now. Frankly, Chancellor, to expect businesses that have been closed to make increasing contributions to furlough is simply unacceptable when they do not have the cash flow to pay for it. More temporary extensions and the tapering off of furlough fall well short of what businesses need. The Chancellor should make the commitment that full furlough support at 80% wage support will remain available to businesses as long as restrictions remain in place—no deadlines, no dates, no ifs and no buts. That is one clear commitment that would immediately stabilise support for every struggling sector.

The cut-off date for entry into job retention schemes should also be revised, ensuring that support is available to the growing numbers who have started new jobs since the end of last October. We welcome the VAT cut, but it should have been retained at 5% for much longer, and it should be extended to businesses such as hair and beauty businesses, which also need the support. While we welcome the ongoing support for rates relief, it does not go as far as the Scottish Government have in providing 100% rates relief for the calendar year across the retail, hospitality, leisure and aviation sectors.

One of my biggest criticisms of this Budget is that it completely fails to recognise the sheer scale of the other pandemic our communities are suffering—the poverty pandemic. After a decade of underinvestment and Tory cuts, the last year has deepened the UK’s poverty crisis and widened gaps in inequality. Yes, many have been in a position to save and build up financial deposits during these lockdowns, but Chancellor, millions more are literally struggling to survive. Some 14.2 million UK adults are now categorised as having low financial resilience. That is an increase of 3.5 million since the beginning of the pandemic. Let me take an example from my own constituency. In January 2020, the community food bank in south Skye and Lochalsh delivered 25 food parcels in one month. In December 2020, that same food bank was delivering 200 bags of food per week.

Last year, this Government were forced into providing a £20 uplift for universal credit. It was literally a lifeline for millions. It was needed then, and it is needed now. Six million people are now claiming universal credit—a 98% increase since the pandemic began. Today, this Tory Chancellor is telling those 6 million people not to get too comfortable with that lifeline, and that in a matter of months it will be gone. Where is the compassion, Chancellor? Where is the support for people? Does he really think that this is good enough and that it is acceptable that so many people—so many families and so many children—have been left in poverty? He can avert his eyes and look away because he does not want to know the harsh reality. The Chancellor does not understand what it is like to be poor in Boris Johnson’s Brexit Britain. Chancellor, do the right thing. This should never be temporary; it should be permanent, and let us make sure, out of this Budget, that that policy is changed. Making the £20 universal credit uplift permanent must also extend to legacy benefits. And Chancellor, while you are at it, finally abolish the cruel benefit cap and end the two-child limit.

The Chancellor should also be using this Budget to support those most impacted throughout the pandemic. The Women’s Budget Group found that women were twice as likely to be key workers as men but are far less likely to be eligible for statutory sick pay. It also found that young women were disproportionately likely to work in the sectors that were hardest hit by previous lockdowns. The Chancellor could support these women by finally introducing a real living wage and a liveable sick pay for all.

We know that after a decade of Tory decisions, child poverty has risen to alarming levels. The Joseph Rowntree Foundation and baby bank charity Little Village found that 4.2 million children are living in poverty, including 1.3 million babies and children under the age of five. This is supposed to be a civilised society. It is supposed to be a caring society. The Chancellor has just congratulated himself on his Budget. Chancellor, where is the plan to get these 4.2 million children and their families out of poverty? Where is the plan to get these young children and babies out of poverty? Where is the sense of responsibility from a Government? What we can see is a Chancellor who is not even prepared to engage; he is looking away—and no wonder, because this Chancellor should be embarrassed by what he has done. This Government need to wake up to the scale of the child poverty crisis, and they could start by matching the Scottish Government’s game-changing £10 child payment.

While we are on the subject of fighting poverty, let me say how disappointed I was by the failure of the Labour shadow Chancellor at the weekend to state her party’s clear support for making the universal credit uplift permanent. In the space of a week, Labour told us that its position on wasting billions on Trident nuclear weapons on the Clyde is non-negotiable but cannot even say what its position is on keeping this lifeline for struggling families. We know we are living in strange times when George Galloway pledges his support for the Tories and the Labour party sits on the fence when it comes to Tory cuts. We would nearly feel sorry for the new Scottish Labour leader, severed at the knees by his Westminster bosses before he even gets started.

Not only does this Budget signal the return of Conservative cuts; it also confirms that the Chancellor continues to snub the excluded. In time, when people reflect back on this period, it will be a damning indictment of this Tory Government that they were prepared to coolly ignore 3 million of their own citizens during a pandemic.

[The Prime Minister]

You talk such utter rubbish.

[Ian Blackford]

Well, well, well, Prime Minister—try telling that to the 3 million people who have had no financial support from your Government over the course of the last year. You should be utterly ashamed of the dereliction of responsibility from a Government who are supposed to provide leadership to all their people. So much for putting your arms around all the people of the United Kingdom! Three million people have been ignored and abandoned by a Prime Minister and a Chancellor who could not care less.

[The Exchequer Secretary to the Treasury (Kemi Badenoch)]

Nonsense—all nonsense.

[Ian Blackford]

Well, the hon. Lady should listen to those who have not had financial support.

On the BBC on Sunday, the Chancellor said that his Government had reacted “generously and comprehensively”. Chancellor, tell that to the 3 million freelancers and self-employed who have been left behind without a penny. Not a penny, Prime Minister, of support. A quick search of Hansard shows that the 3 million excluded have been raised in the House around a thousand times since last March. Their plight has been ignored by Ministers on 1,000 occasions in the House and it is a disgrace that the Chancellor has chosen to ignore them today.

I acknowledge and welcome the fact that the newly self-employed have now finally been covered by the scheme, but a whole community of people remains ignored and forgotten by the Chancellor. Yes, 600,000 will now be included, but what about the other 2.4 million who have been discarded, written off and ignored by the Chancellor and the Prime Minister?

The Budget’s failure to stand by and support those who have suffered most during the crisis goes to the very heart of the economic choices made. It should have been the Budget that kickstarted a strong, fair and green recovery. That is precisely why the SNP has been calling for a substantial stimulus package—5% of GDP; at least a £98 billion package of investment, which would give us the opportunity to emerge from the pandemic with investment-led growth. That would follow President Biden’s lead and provide a fiscal stimulus that boosted business, protected jobs and stimulated sustained economic growth. Instead, the Budget falls painfully short of that level of ambition. Instead, the Chancellor wants to drag us back to business as usual, back to the same old failed economics of a decade ago.

There is plenty of evidence that Tory austerity cuts are already making a comeback. In November, the UK spending review set out plans to reduce non-covid-related spending by up to £13 billion a year. There is already a public sector pay freeze, including for those key workers who have protected us through the crisis. That is the thanks from this Government.

There has already been a reduction by Westminster in Scotland’s capital budget. The Tory choice to impose austerity is also holding back opportunities to truly build back better beyond the pandemic. A huge number of those opportunities are in the green economy, whether in energy, housing, transport or waste. I acknowledge the £27 million announced for the energy transition zone in Aberdeen, which matches financial commitments that the Scottish Government made in June 2020, but it still falls well short of the wider £62 million energy transition package from Holyrood. Let us not forget that the North sea oil industry has contributed a massive £350 billion to the Exchequer in the last few decades.

The Tories have reneged on promises to support carbon capture schemes in the past, so the Chancellor will forgive oil and gas sector workers in the north-east of Scotland who have developed a healthy scepticism about Tory promises. Chancellor, to really stimulate the green economy, you need finally to reform contract for difference to deliver support for wave and tidal generation and guarantee that Scottish suppliers will be used.

The Chancellor and the Government need to give Ofgem a strategy objective to support the delivery of net zero. Transitioning to net zero is an economic imperative, but it is also a moral imperative. Last week, the United Nations Secretary-General warned that

“2021 is a make or break year to confront the global climate emergency.”

I genuinely say to all hon. Members that COP26 in Glasgow this November offers the chance to unite around an ambitious agenda to tackle the climate crisis.

It is possible for us to look forward to those opportunities only because of the actions of those who have protected us through the last 12 months. Our NHS has been on the frontline in the fight against covid-19. Our workers have been nothing short of heroes with their efforts to save people’s lives and provide care. If we are truly grateful for those efforts, we must secure the financial future of the NHS by introducing long-term investment and rewarding those who work for it. A good start would be matching the Scottish Government’s £500 thank-you payments and making them free from tax and benefit deductions. That also means matching Scotland’s current per head funding for the NHS, which would deliver an extra £35 billion for the NHS in England and £4 billion for NHS Scotland in Barnett consequentials. That, Chancellor, would be a fitting tribute to the institutions and the people who have bravely led us through the worst days of this pandemic.

This is the second Budget delivered by the Chancellor, and it is also very noticeable how little reference he made to Brexit compared with the first. Brexit is now the mess that the Tories and the Labour party dare not speak of, and it is little wonder why. The bad Brexit deal that the Prime Minister forced through the House in the final days of December is already proving more disastrous than predicted, and Scottish businesses, from fishing to farming, are losing millions of pounds every day as a direct result of red tape. This threatens to get worse, with grace periods and some food exports ending in April. Instead of taking responsibility for the Brexit mess they have made, the Tories have washed their hands and walked away.

The same is true for this Budget, which fails even to recognise that the very survival of thousands of food and drink exporters is now at stake. In December, the EU put in place a compensation package for those countries most affected by Brexit. Ireland alone got €1 billion. Chancellor, where in this Budget is a similar compensation package for Scottish businesses that are losing out every single day? Where in this Budget is a guarantee that the so-called shared prosperity fund will match the loss of EU structural funds? Today’s Budget gives no commitment, no clarity and no compensation. It only adds to the ever-growing list of broken Brexit promises.

Of course, the real agenda behind the Brexit betrayal is now emerging. For a year now the Tories have been in panic, privately planning for an independence referendum that they publicly say will not happen. The purpose of the internal market Bill, the Union unit and, now, the so-called levelling-up fund is crystal clear: they are all an attack on devolution.

The Chancellor is undermining our Parliament and centralising resources and decision making at Westminster. It is a naked power grab to bypass the devolved Parliaments and take control of funding in devolved areas. Oh, the irony: take back control. They are taking back control from our Scottish Parliament. That is not only the opinion of the SNP; it is the verdict of the former First Minister of Wales—[Interruption.] We hear Tory MPs representing Scotland chuntering away. They are supporting this power grab against the people of Scotland and, frankly, they should be ashamed of themselves. They are showing themselves up for what they have always been: the anti-Scottish Tory party.

Carwyn Jones said that the failure to apply Barnett to the new levelling-up fund would

“divert money away from Wales, Scotland and NI and give a greater proportion to England.”

Of course, the Prime Minister has form, because he talked about doing that in days gone by.

These attacks on devolution show what is now fundamentally at stake. As I said at the beginning of this speech, post Brexit and post pandemic, Scotland has a choice of two futures. At the heart of that choice is a simple question: who is best placed to lead Scotland’s recovery and build a better future? Is it Westminster Governments we did not vote for or independent Scottish Governments, of whatever party, chosen by us and with Scotland’s best interests at heart?

As we look ahead, we have every confidence in what is possible if we take our future into our own hands. We have the resources. We have the wealth. We have the talent. As an independent country, we can decide how best to use all those resources, all that wealth and all that talent. We will be the decision makers. We will be able to chart our own course and build our own future. The Tories can try to deny democracy all they like, but the inalienable right to self-determination cannot and will not be subject to a Westminster veto. There is no Boris veto on Scottish independence. We keep faith in the right and the power of the people to bring about democratic change. That choice is in the hands of Scotland’s people. It is they, and they alone, who will now decide that future.

[Madam Deputy Speaker (Dame Eleanor Laing)]

We proceed with a maximum time limit of seven minutes. That does not mean that Members have to take seven minutes; they can take fewer, but no more than seven minutes. I call the Father of the House, Sir Peter Bottomley.