Budget Resolutions and Economic Situation

Patrick Grady Excerpts

Monday 21st March 2016 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

We were told earlier by the hon. Member for Telford (Lucy Allan) that this was a Budget for Telford. Well, it is certainly not a Budget for disabled people, young people or low-income families. It is not a Budget for businesses either. A Budget that projects a systematic reduction in funding for the Department for Business, Innovation and Skills cannot be good for businesses.

I am aware that I have a very short time, but I want to briefly mention city deals. The Aberdeen city deal, with £125 million from the UK Government, was announced earlier this year. That is roughly a third of what Manchester got per head, so I suggest that the UK Treasury is not particularly for Aberdeen either.

It has been suggested that the lifetime ISA, which was mentioned earlier, will be helpful for families, but the technicalities mean that it will not be helpful for anybody not looking either to buy a home or to support themselves in their retirement. For example, the money could not be withdrawn to support a couple who have just started having children.

As a Member for Aberdeen, I might be expected to talk about oil and gas, and we welcome the changes made, such as the effective abolition of the petroleum revenue tax and the halving of the supplementary charge, but there are still major issues for the oil and gas sector in relation to banking. It is difficult for companies to find finance at the moment. I am talking not about large infrastructure projects, for which there is the opportunity for loan guarantees, but about day-to-day business. Given the oil price just now, it is really tough for companies, and they are struggling to find finance. Some of the banks, although they are saying nice words to parliamentarians, are not actually lending to oil companies. They are pretty much saying, “Nah,” to supply chain companies, for example, which are the companies we need to be supporting just now.

I welcome the measures on decommissioning, but the UK Government will have to shell out about 62% of the cost of decommissioning oil rigs, so the longer it can be pushed out, the better for the UK Treasury, and this would be a benefit. It is very important that the UK, as one of the first fields to reach maturity, learns fast and becomes good at exporting that expertise. We need to support that.

[Patrick Grady (Glasgow North) (SNP)]

My hon. Friend commented on the lack of time available. Does that not speak to the wider concerns expressed several times, not just about the budgetary process but about the estimates process in the House? Does she agree that this is an urgent matter for the Procedure Committee to consider?

[Kirsty Blackman]

I thank my hon. Friend, who is a member of the Procedure Committee, for bringing that up, because it plays nicely into my next point, which is about how the Budget process works. We have had very little time for speeches today.

The Budget and the documentation we are provided with contain a total lack of clarity about Barnett consequentials in relation to the budget lines. For example, there are budget lines around cathedrals and cultural investment but no clarity, even in the statement of funding policy, about whether those things will generate Barnett consequentials and, if so, what the percentage of comparability is. It is very difficult for MPs to scrutinise these matters. The Tax Law Review Committee said:

“the House of Commons has neither the time nor the expertise nor, apparently, the inclination to undertake any systematic or effective examination of whatever tax rules the government of the day places before it for its approval”.

That is partly because of the complexity of the tax rules. Obviously, tax is levied on individuals personally, and then tax reliefs and benefits are provided to families, so it is quite a complex thing to work out. MPs lack the time—we have hardly any time to discuss it today—and the information to scrutinise the Budget effectively. This process needs to be improved as a matter of urgency.