Budget Resolutions and Economic Situation

Patricia Gibson Excerpts

Thursday 17th March 2016 Commons Chamber

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

George Osborne’s Budget yesterday was nothing more than an attempt to—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. The hon. Lady has to say “the Chancellor of the Exchequer” or “the right hon. Gentleman”.

[Patricia Gibson]

The Chancellor’s Budget yesterday was nothing more than an attempt to confirm that austerity is king for this Government. Ideology has blocked the path of any attempt to ease the burden on the backs of the less well-off. Even setting aside the cuts to welfare and capital spending, the OBR estimates that between 2009-10 and 2019-20 Westminster funding for day-to-day public services is forecast to fall by the equivalent of about £1,800 per head. Chillingly, the Institute for Fiscal Studies predicts that the scale of the cuts to departmental budgets and local government will reduce the role of the state to a point where it will have “changed beyond recognition”, with £3.5 billion of new cuts in this Budget. That is an additional £3.5 billion of cuts for 2019-20 that will once again hit unprotected Departments. The Chancellor of the Exchequer has not specified where that money will come from, either. Scotland faces a £1.5 billion cut in its funding for public services, which means that between 2010-11 and 2019-20 Scotland’s fiscal departmental expenditure limit budget has been reduced by an eye-watering 12.5% in real terms.

I listened earlier to this Government lauding their support for young people, but we have already witnessed the slashing of student maintenance grants for some of the poorest students and their being converted into loans. Housing benefit for unemployed 18 to 21-year-olds has been scrapped, which will create enormous hardship for young people. Student fees will continue to rise. Student nurses will no longer receive grants, but loans instead. All calls for the reintroduction of the post-study work visa in Scotland have gone unheeded.

Of course we welcome the support for the oil and gas industry—as far as it goes—but what is really required is a strategic review of the whole tax regime for oil and gas. The SNP called for a such a review ahead of the Budget, but again that went unheeded. The freeze on fuel duty is to be welcomed. This is a victory for small businesses and rural communities such as Arran in my constituency, and it will also be welcomed by families with stretched budgets across the UK.

More than anything, this Budget bolsters and consolidates inequality across the United Kingdom. Increasing the personal tax allowance is a very expensive approach and it badly targets help for the low paid. That is the view of the Child Poverty Action Group, and the Government should take note. It is not a social justice measure when 85% of the £2 billion that the Treasury spends goes to the top half and a third goes to the top 10%. For every £1,000 by which the personal tax allowance goes up, basic tax rate payers gain £200, but universal credit rules will claw back 65% of that gain from the low paid, leaving them gaining only a maximum of £70 a year. Child poverty campaigners have concluded that this Budget sets the next generation up to be the poorest for decades. Yet there is still money—between £15 billion and £100 billion—to be found to renew Trident. Disability rights groups have warned that these changes will be a devastating blow to disabled people. This is a Budget of missed opportunities.