Budget Resolutions

Kirsty Blackman Excerpts

Tuesday 30th October 2018 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

It is an honour to speak for the Scottish National party on the second day of the 2018 Budget debate.

Ten years ago last month, Lehman Brothers collapsed. Excessive risk-taking by financial institutions created an international banking crisis, and a global downturn followed. Since then, people and families across the UK have had to pay for the fall-out. There has been a decade of wage stagnation, a decade of cuts and a decade of the most vulnerable in our society being hit the hardest by Tory austerity. Looking forward, we are staring into the abyss that is Brexit. Mark Carney says that Brexit has already cost householders an average of £900, and the Fraser of Allander Institute estimates that leaving the single market and customs union would cost 80,000 Scottish jobs. After a decade of austerity, households cannot afford to lose £900 each, and they certainly cannot afford a Tory Brexit.

The reality is that the people of Scotland are badly served by Westminster. We did not vote for a Tory Government and we did not vote for Brexit. I cannot think of a time in the past when a country has committed such a foreseeable act of economic self-harm. The Chancellor does not believe that we will be better off after Brexit. Even the Prime Minister does not believe that we will be better off after Brexit. We were promised £350 million pounds a week for public services. We will not be bought off with a commemorative 50p coin.

[Sir Edward Davey]

The hon. Lady is making an excellent start to her speech. Does she agree that, after a decade of Lehman austerity, we could be facing a decade of Brexit austerity?

[Kirsty Blackman]

I absolutely agree. An economic catastrophe is coming down the line as a result of Brexit. It does not matter what kind of Brexit there is; any Brexit is bad for the economy. Staying in the EU is the best possible option for the economy. If we cannot stay in the EU, staying in the single market and the customs union is the second best option.

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Further to that point, did my hon. Friend notice in the Red Book that the expected growth that the UK will achieve in the next four to five years equals that of Ireland in only one year? Is that example not a clear signpost to all in Scotland and elsewhere that independence has worked for Ireland and is going to work for Scotland, and that the sooner we get it and the sooner we are clear of this lot, the better?

[Kirsty Blackman]

Absolutely; it is clear that remaining part of the UK is bad for Scotland’s economy. The comparators in the Budget information documents show that the UK economy is growing slower than the EU economy is set to grow in every but one of the next five years.

[Matt Hancock]

May I just ask whether the hon. Lady has ever seen the result of a referendum that she likes?

[Kirsty Blackman]

Do you know what? The reality is that we have argued for a very long time—I have argued for my entire adult life—against the current democratic system, because it does not work for the people of Scotland. We do not get the Governments we vote for and we do not get the result that we voted for in the EU referendum. If the democratic system meant that Scotland’s votes were reflected in reality, we would be in a very different situation today.

On a serious note, every week in our communities and at our surgeries MPs from both sides of the House are faced with the consequences of Westminster’s poor decisions. We see working mothers forced to go to food banks. We see and hear about the Home Office-enforced separation of families. We meet young men struggling with mental health problems who have been sanctioned yet again because they are unable to jump through the unreasonable hoops put in their way by the Department for Work and Pensions. I do not know how anybody, even in this Westminster Government, can believe that their policies are having a positive benefit. The tears and desperation with which we are all faced on a regular basis give the lie to that notion.

The Chancellor has failed adequately to fund our public services in this Budget. He has failed to undo the devastating social security cuts, he has failed to legislate for a real living wage and he has failed to provide adequate support for businesses facing the impending cliff edge of Brexit.

The Budget should have included decisions to help support all those who have been hit by a decade of austerity, and all those who will be hit by the forthcoming Brexit. The roll-out of universal credit should have been halted. A third of working-age households will be entitled to some universal credit. Of those, around a third will be at least £1,000 a year worse off than under the legacy system.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Does my hon. Friend agree that the Government missed an opportunity in the Budget yesterday not only to correct the injustices of universal credit but to compensate councils such as Highland Council that are having to foot a £2.5 million bill out of council tax funds simply for administering this failed and shambolic universal credit roll-out?

[Kirsty Blackman]

Absolutely. The Highland Council area has been particularly badly hit as one of the first areas in which universal credit was rolled out. It is currently rolling out in Aberdeen, and I am hugely concerned about the impact it will have on my constituents. The roll-out needs to be halted, because the issues that happened in the highlands and elsewhere have not been fixed, and they need to be fixed before any further roll-out can occur.

The benefits freeze should have been lifted, the sanctions regime should be scrapped, support for lone parents under the age of 25 must be reintroduced and the WASPI issue must be sorted, with those women being given the money they are owed. I am pleased that the Government have made a commitment to the pensions dashboard, but they now need to legislate to compel companies to comply so that people can access information about the pensions they are owed, and so that they can then get those pensions. That is important, and lots of people have been calling for it.

Workers’ rights are another reserved issue, and the Chancellor should have committed to increasing the minimum wage to the living wage—an amount people can actually live on—by the end of this Parliament. The Office for National Statistics said this week:

“Among the countries of the UK, long-term pay growth has been highest in Scotland… Median pay for full-time workers was 87% higher in Scotland than it was in 1997.”

The Scottish Government are doing all they can, particularly for staff employed in public sector roles, but we need the powers to do more. In Scotland, our Government have focused on uplifting the pay packets of the lowest paid, which is a progressive choice that makes the most positive difference. The UK Government have not chosen to do that.

We have fought long and hard for a single, real living wage rate. The UK Government need to recognise that it does not cost a 24-year-old less to live than it costs a 25-year-old. If the Chancellor will not make the required commitment to a real living wage for all, he should devolve it so that we can.

Statutory paternity leave should be doubled from two to four weeks, giving fathers even more opportunity to bond with their babies. A complete review of parental leave should be undertaken, including consideration of the start date of maternity leave, especially when a baby is born prematurely.

We propose that the Government set up a labour participation committee to consider groups that are currently under-represented or over-represented in certain sectors, and to examine barriers to work for women, disabled people, parents and other marginalised groups.

The Institute of Directors has called for a pot to be set aside so that small and medium-sized enterprises can bid for advice on how to cope with Brexit. The UK Government’s advice thus far has been wholly inadequate, and we have only five months to go until the UK crashes out of the EU.

Businesses need to be able to access finance in order to grow. To do that, they need to have trust in financial institutions and, crucially, financial institutions need to earn that trust. The Chancellor should have committed to setting up a tribunal service so that those affected by business banking fraud—through the Royal Bank of Scotland’s global restructuring group, Lloyds Bank, Halifax Bank of Scotland or others—can seek affordable redress, rather than having to go through a court process that is too expensive to access.

The UK Government must also ensure that current EU funding will continue until the end of the current multi-annual financial framework. Scotland must not be any worse off in respect of the funding allocations that replace those provided from the EU, and any arrangements must fully respect devolution and must be put in place with the consultation and agreement of the Scottish Parliament.

The Chancellor had an opportunity to make a commitment to the oil and gas sector deal, and he failed to do so. Our industry needs the deal to be signed off now, particularly with the impending lack of access to labour and investment following Brexit. I am pleased that he has heeded calls to make a clear statement on the future fiscal regime, because we cannot have unforeseen, sudden tax hikes like those made by previous Chancellors.

The other part of the jigsaw that is missing is a commitment to reducing the harmful climate change effects of the use of fossil fuels. In 2015, the UK Government cancelled their £1 billion carbon capture and storage competition, just six months before it was due to be awarded, after spending £100 million on it. That left Peterhead—a key candidate for support—behind. After three years of research and development, we have missed out on this vital industry of the future. The UK Government need to make an unequivocal commitment to supporting the development of CCS.

[Drew Hendry]

My hon. Friend makes a powerful point about carbon capture, and about the betrayal of the £1 billion project at Peterhead. Does she agree that, if the UK Government are serious about meeting the climate change targets under the Paris agreement, spending £100 million now, when we are behind the pace after abandoning a three-year £1 billion project, is just not good enough?

[Kirsty Blackman]

Absolutely. The potential benefits of CCS are unquestionable and, as my hon. Friend says, we need to get ahead of the curve again. We need the UK Government to commit to putting the money in now. That is especially important because their pulling the plug means there is now a lack of trust among the companies that are developing CCS. The UK Government need to make a clear and unequivocal commitment.

On evolving technologies, Scotland is a global leader in tidal, and the UK Government must work with the Scottish Government on the contract for difference process to support the technology journey from development to commercialisation, which is particularly important for tidal.

On solar power, we have been contacted by so many individuals who are concerned about what is happening to export tariffs for homes, small businesses and community energy projects from next April. The tariff is a vital support that encourages people to invest in solar power, and it must continue.

Lastly, in order to reduce climate change and to increase the use of healthier methods of transport, this Budget was an opportunity to reduce VAT on bikes. Just as we would like to see VAT removed from digital books, reducing VAT on bikes would make them cheaper for all and would be a real statement of intent from the Government on reducing climate change.

[Sir Robert Syms (Poole) (Con)]

Is the hon. Lady not aware that reducing VAT is very difficult while we are a member of the European Union, but it is something that we might be able to do after Brexit?

[Kirsty Blackman]

Actually, reducing VAT is quite possible for a member of the EU. Zero rating things is a problem, but reducing VAT is fine.

The Scottish fire and rescue service and Police Scotland are still owed £175 million of VAT. The UK Government have recognised that the system they had in place was unfair, yet they have refused to pay back the £175 million they owe our two vital life-saving industries. It would be incredibly useful if they could see their way to giving us back that £175 million.

On the subject of the UK Government reallocating funds that should rightly have gone to Scotland, the convergence uplift of £160 million should have been paid to Scottish farmers. The Secretary of State for Environment, Food and Rural Affairs has admitted that the money has been spent elsewhere. We need a commitment that this money will come to Scotland in future years, and we need the previous years’ money to come to Scotland now, so that our farmers can have the cash they have been allocated.

I am pleased that the Budget includes measures to ensure that companies pay their fair share of tax in the digital sphere, but the reality is that this is a consultation and the measures are not going to be in place yet. We also do not have a solid idea of what those measures will be. The Scottish National party would therefore like to propose two measures on digital taxation, and we hope that the Government will take them into account. First, we believe that online retailers should be held liable for tax fraud committed by their suppliers. Sometimes when people order a product from a well-known online retailer it is delivered from China with a customs declaration and a stamp that says “gift”. Large online retailers should be held responsible for ensuring that those who use their platform pay the correct customs duties. We also believe that in order to combat tech firms that avoid corporation tax by registering implausibly low UK profits, the Chancellor should levy corporation tax on an assumed UK share of worldwide profits that is equal to their UK share of worldwide revenue. That could be subject to a dispute tribunal process to ensure fairness. The SNP will submit these suggestions in the consultation process, and we hope that they will be considered seriously.

Scotland’s cities have received city deal funding from both the UK and Scottish Governments. That is welcome, but what is not welcome is the fact that the UK Government have contributed far less to those deals than the Scottish Government. In total, the Tories have failed to match more than £350 million of Scottish Government funding for city deals and growth deals in Glasgow, Aberdeen, Inverness, Stirling and Clackmannanshire, Tay Cities and Edinburgh. We believe that they should match our contribution, and we call on the Chancellor to make that commitment, as well as to fulfill the Chief Secretary to the Treasury’s commitment to provide each part of Scotland with a regional deal.

I come to an ask, for the NHS, that would require only a small financial contribution but would have significant positive benefits. The UK Government could have used this Budget to follow Scotland’s lead on PrEP—pre-exposure prophylaxis. In Scotland, PrEP is available on the NHS, but England has been dragging its heels on making it available. The benefits in terms of the reduction in new cases of HIV are unchallengeable, and it is not fair that those in England cannot currently access the drug on the NHS. That change would not cost a huge amount of money, but it would make a massive difference to people’s lives.

If the UK Government are serious about taking their place on the global stage, they need to reform the immigration system. Countries will be looking for a more flexible immigration policy before signing trade deals with us, and we should start by getting rid of the fees that EU citizens will be expected to pay to acquire settled status. The OBR mentions the ageing population at many points throughout the Blue Book. The UK Government must recognise this challenge, and recognise that we need and want people to come to live and work in our communities. Last year’s Red Book said that a reduction in net migration of 20,000 would reduce GDP by about 0.2% by 2022. The Government need to be honest about the benefits of immigration and be clear that it is good for our country. They need to be clear that, with an ageing population, it is incredibly important that we get people to come to work here, particularly in the care sector and in the NHS. We also need a more flexible working visa policy that gives those who are seeking asylum the right to work, as the current system is dehumanising and unsustainable. Lastly, we should scrap the fees paid that families have to pay to get their children citizenship, which are ridiculously high and are yet another tax on families.

On health spending, the UK Government gave commitment after commitment that they would pass the full Barnett consequentials of the increased health spending on to Scotland, but they have chosen not to do so. They have chosen to short-change Scotland by £50 million. This comes on top of the fact that the Scottish Government’s fiscal resource block grant allocation will be almost £2 billion—or 6.9%—lower in real terms than it was in 2010-11. Despite the addition of consequentials and other non-Barnett allocations in 2019-20 that the Chancellor announced, Scotland’s fiscal resource block grant is still lower in real terms than it was in 2010-11 and at the start of the current spending review in 2015-16.

The Chancellor had the chance to make a real difference. He had political choices to make and at almost every turn he chose the wrong path. Is it any wonder that people do not trust the Tories? This Government need to follow the lead of the Scottish Government, who have put dignity and respect at the heart of decision making, rather than punishing those who are not born rich. The reality is that people in Scotland are faced with a choice of two futures: they can choose to continue to have a Westminster Government, who make political choices that disadvantage those who can least afford it; or they can fight for a fairer Scotland, where our Parliament has the powers and the responsibility to make choices on behalf of our citizens—choices that will make our country fairer, not create further inequality.

[Several hon. Members rose—]