Oral Answers to Questions

Ian Murray Excerpts

Wednesday 1st July 2020 Commons Chamber

[Mr Jack]

The unemployment rate is going up faster than anywhere else in the United Kingdom, and we are proving in Scotland to be slower at reopening our economy—something I regret. It is important that we get our economy reopened as quickly as possible, because that is the best way to save jobs. As I say, we are currently supporting almost 800,000 jobs through the self-employment support scheme and through the job retention scheme. It is important that once we get back to near-normal, our economy bounces back as quickly as possible. The best way to achieve that is to keep money in people’s pockets, and the 80% furlough has done just that.

[Ian Murray (Edinburgh South) (Lab)]

I echo the Secretary of State’s remarks about our heroes in the public services in Glasgow who responded to the stabbings last Friday. I am sure that he, and the whole House, would wish to join me in expressing our deepest sympathy and all our thoughts to the family and friends of the three-year-old boy who was tragically killed yesterday when a car went out of control and mounted the pavement in Morningside Road in my constituency—a very young life taken far too soon.

As lockdown measures are eased, some sectors of the Scottish economy, as we have heard, will take much longer than others to return to some sort of normality, particularly tourism, hospitality and the creative industries. It is vital that both Governments continue to protect jobs and support businesses by extending the current furlough support to those hard-hit sectors. Even now, far too many are falling through the cracks of Government schemes—for example, many freelancers working through pay-as-you-earn contracts. With many taxpayers in this situation going from full income to no income, will the Secretary of State commit to raising in Cabinet the need for Government to support those taxpayers who have received nothing, and for an extended sectoral furlough scheme for Scottish industries?

[Mr Jack]

Let me start by echoing the hon. Gentleman’s remarks about the shocking incident on the pavement in Morningside Road yesterday.

The Chancellor acknowledged right at the beginning that we cannot save every business and we cannot save every job, but there has been a huge rapid response from the United Kingdom Government to covid-19, with unprecedented sums going to Scotland in the form of £3.8 billion for business support and, as I mentioned, the 800,000 jobs that have been supported. I have raised this with the Chancellor and we have talked about how we go through to the next stage. He will be addressing that when he speaks to the House a week today.

[Ian Murray]

I appreciate that answer from the Secretary of State, but there are still too many people who have gone from full income to no income while paying full taxes.

The former SNP finance spokesperson and author of the First Minister’s Growth Commission report has said that Scotland will have the worst performing economy in the developed world post covid. The response by the SNP Finance Minister was to reignite the demand for full fiscal autonomy, which would have the effect of creating a multi-billion-pound black hole in Scotland’s public finances. First, has the Secretary of State undertaken any analysis of the impact that this policy would have on post-covid recovery in Scotland? Secondly, rather than both Governments playing politics, will he work collaboratively with the Scottish Government to seek solutions to the immediate post-covid budget challenges so that we can save as many jobs, businesses and public services as possible?

[Mr Jack]

The Scottish Finance Minister, Kate Forbes, has questioned the Barnett formula and has raised full fiscal autonomy as a preference. I would say to the people of Scotland that, for £100 of spending per head in England, the Barnett formula guarantees £125 per head of spending in Scotland. The Barnett formula has produced the extra £3.8 billion of covid support. Last year, the Barnett formula plugged a £12.6 billion deficit in Scotland’s spending. Along with the furlough scheme, these things would not have been possible under full fiscal autonomy. In fact, had the Scottish Government imposed that on the Scottish people, I would call it full furlough absence.