Scott Arthur
Main Page: Scott Arthur (Labour - Edinburgh South West)Department Debates - View all Scott Arthur's debates with the Scotland Office
(2 days, 20 hours ago)
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Dave Doogan
Yes, the highest—so it is not as if there was some kind of low-taxation holiday spree and the Labour Government came in and put taxes up to compensate for it. Taxes were already the highest that anybody can remember and now they have gone up again by the highest amount in 32 years. It is absolutely eye-watering. The Chancellor’s refusal to step back from cutting the winter fuel payment from around 900,000 pensioners is absolutely—[Interruption.] They are chuntering that the winter fuel payment is devolved.
Dave Doogan
No.
Let us get it on the record that the fuel payment did not use to be devolved and that, at the same time as it was devolved, they went and cut the budget. That is the Labour Government at a UK level for you. So yes, I know it is devolved.
Dave Doogan
No. If the hon. Gentleman can get one of his colleagues to intervene, I will give way to them.
The Government’s decision to raise national insurance was like them showing that they do not know how the real economy works without showing that they do not know how the real economy works. It is a punitive lowering of the floor and increasing of the rate to try to wring out of employers the money required to recover the economy. It is a drag on employment, investment and wage rises. It is absolutely unforgiveable and totally counter to what the Labour party stated, ahead of the election, was its aim: to create a Budget for growth. There will be absolutely no growth as a consequence of that autumn statement. The Government think they will raise over £20 billion but, by the Treasury’s own measure, that figure is down to around £10 billion after they have made all the compensations. It is a massive swage of pain for very little gain in investment.
In moving the motion, the hon. Member for Livingston said that we in the SNP are keen to spend the extra money we will get but not to say how we would raise it. Actually, I will tell him how we would raise it, and our way would be much more cogent than what the Labour Government in Westminster have said they will do. Over and above that, in a Scotland-specific context the hike in duty on Scotch whisky was, in the words of the industry itself, “an indefensible tax grab”. Yet somehow we are expected to believe that everything will be okay because Anas Sarwar is going to speak to the Chancellor about it. The Chancellor will presumably then do what the UK Government always do when Labour in Scotland ask them to do something: absolutely nothing, if not the exact opposite.
The hon. Member for Livingston also talked about energy. He should go up to the north-east of Scotland to talk about energy: we are six months into this Government and there is no evidence whatever of GB Energy making any impact in Scotland. The last time I checked, it had one employee and was based in Manchester. The hon. Member also talked about the investment that would be realised. Somehow, the Acorn project in Scotland —the most deliverable carbon capture, usage and storage project across GB—is still not being funded by the Labour Government, despite their funding a further two CCUS projects in England, in addition to the two already there. Sadly, it is England 4, Scotland 0—it is like a football match.
Harriet Cross (Gordon and Buchan) (Con)
I congratulate the hon. Member for Livingston (Gregor Poynton) on securing this debate, although I find it odd that Scottish MPs have been celebrating the Budget, as if it was the best thing ever to come to Scotland, given that it is nothing short of disastrous for so many of the key sectors that underpin Scotland’s economy, communities and livelihoods.
The Chancellor spoke, and still does, about protecting working people—and, indeed, about growing the economy in order to help working people—yet her decision to increase employers’ national insurance contributions does exactly the opposite. This £25 billion tax grab from businesses impacts on their resilience, growth, investments, hiring decisions and longevity. The scale of this tax rise and the betrayal by Labour, who promised not to raise taxes on working people, including national insurance, is completely unprecedented.
For the avoidance of any doubt, and because I know that Labour seems to struggle with this, business owners are working people, and they employ working people—they are working people who contract working people and supply working people, who then can work elsewhere. This NICs rise is a tax on working people across Scotland and the UK, and there is no credible way that that can be denied. It is also an up-front tax and a tax for having employees. Businesses pay it just for having employees on the books, before they even open their doors. Take weeks like this in Scotland, including in my Gordon and Buchan constituency, where many businesses have not opened because of snow and ice; the bill for this tax is still racking up, despite them not being able to trade.
Of course, the effects of NICs are felt more widely, not just by businesses. Charities, GPs, pharmacies and local authorities are all also impacted. I have met with my local medical practice in Inverurie, and its NICs bill is going up by £75,000. It cannot pass on that cost, and if it reduced services, its funding would be reduced. What do the Labour MPs who are celebrating the Budget suggest that that practice should do? As I have mentioned, Aberdeenshire council now needs to find £13 million to cover the NICs rises, and that is on top of the £40 million black hole it already faced due to north-east councils being so poorly funded by the Scottish Government.
Moving on to other matters, the changes to business property relief and agricultural property relief are cynical, cruel, misguided and absolutely damaging to the key sectors of our economy. Family businesses up and down the country, including in Scotland, are the backbone of our economy. These changes will decimate family businesses, who have been nurturing for generations, who are the centre of their communities and who employ over 14 million people nationwide. The changes to APR, which I have spoken about a lot, demonstrate the Government’s complete disconnect from rural farming and ways of life. We know that the Treasury figures are incomplete. They do not consider farms where only BPR had been claimed. Labour seems to think that all farmers are married, that both spouses will be able to pass on the farm at the same time and that, effectively, it is okay to force farmers into early retirement—for them to have to leave their family home or pay full market rent to stay at the property where they have lived their entire lives.
The Treasury is hiding behind the claim that only 2,000 estates will be affected, but the Country Land and Business Association, the National Farmers Union and the National Farmers Union of Scotland say that the number of farms affected will be more like 70,000. These figures need to be considered. The Chancellor, as we know, is literally making farmers decide between selling their farm, their land, their buildings or their machinery to raise the funds. This will leave farms commercially unavailable or severely damaged, and we are talking about farms in our constituencies across Scotland, including many of those of the Labour Members here.
We have heard others talking about whisky, so I will touch on that just briefly. The Prime Minister stood in a whisky distillery in Scotland and promised to back the Scotch whisky industry to the hilt, but he failed to mention that he was going to increase tax by 3.6%, bringing the tax on a bottle of whisky to over £12 for the first time.
Dr Arthur
The hon. Lady is making heartfelt points, but we are yet again hearing a long list of our money-raising initiatives that the Conservatives opposed while being cheered on by their SNP colleagues. I would be interested to know how the Conservatives would have raised the money needed to get public services in Scotland back on track. An extra £5 billion is going to the Scottish Government to fund services such as the NHS in my constituency and in the hon. Lady’s constituency. Where would her party have found that money?
Harriet Cross
As I said, the Government can give with one hand and take with the other, which is what is happening with NICs; they are taking that money out of councils, so the increase is completely irrelevant. The removal of the ringfence from some budgets has meant that there has been no real-terms increase in the rural affairs budget in Scotland, and that has impacted our farmers—it goes round in circles.
On oil and gas, the changes to the energy profits levy and the removal of the investment allowances in the Budget had an instant impact. Apache announced very soon afterwards that it would pull out of the North sea, citing the onerous impact of the EPL. The Aberdeen and Grampian chamber of commerce warned that 100,000 jobs are at risk, and Offshore Energies UK said that 35,000 jobs tied to specific projects are at risk. Those changes in the Budget have real-life consequences across Scotland, but particularly in Gordon and Buchan, Aberdeenshire, Aberdeen and north-east Scotland.
The Budget shows the Labour Government’s fundamental misunderstanding and undermining of Scotland’s economy and communities. From family farms and businesses to distilleries, our energy sector and the high street, the Government have chosen to burden, rather than support, businesses across Scotland.