Budget: Scotland

Valerie Vaz Excerpts

Tuesday 7th January 2025 Westminster Hall

[Pete Wishart (Perth and Kinross-shire) (SNP)]

Labour colleagues like nothing more than to talk about the Scottish Government—they do it every time they get the opportunity. But does the hon. Gentleman not understand the depth of anger right across Scotland about this Budget, whether it comes from pensioners who are freezing in their homes right now, child poverty campaigners who are disappointed that it will do nothing about the two-child benefit cap, employers who are paying the cost of the national insurance rise, or farmers?

[Valerie Vaz (in the Chair)]

I call Gregor Poynton—

[Pete Wishart]

Is this the reason behind the massive fall in Labour support in Scotland?

[Several hon. Members rose—]

[Valerie Vaz (in the Chair)]

A number of hon. Members wish to speak, and we will have to take the wind-ups at about 3.28 pm.

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[Torcuil Crichton]

Can I ask the hon. Member which taxes the SNP would raise?

[Valerie Vaz (in the Chair)]

Order. I remind the hon. Member for Angus and Perthshire Glens that he has spoken for 10 minutes already. If every other hon. Member takes that amount of time, we will not be able to hear from everybody.

[Dave Doogan]

That is fine, Ms Vaz; I am just closing now. I do not think Members will be speaking for 10 minutes, but that is not my job.

On the progressive income tax regime implemented by the SNP in Scotland, I should say that Labour criticised us when we had the powers and did not use them, and criticised us when we had the powers and did use them. If the UK Government had mirrored our fiscal policy on income tax, they would have raised about £16.5 billion across the United Kingdom. That would not have been reduced to £10 billion because of compensations that they would have had to make, because there would not have been a raise on employer’s national insurance; they would not have had to compensate anybody. They do not want to talk about Brexit, but I do, because it cost the UK £30 billion a year and Scotland £10 billion a year, which would otherwise have been a great increase in the economic output of Scotland and the rest of the UK.

My final point is that the UK Government could scrap nuclear weapons. In four years, the estimated budget has gone up from £44 billion to £100 billion over a 10-year period. An awful lot of investment could be made in Scottish communities with that money, which would boost Scotland even more. We already enjoy the highest number of GPs, nurses, midwives and teachers per head in Scotland; nowhere else in the United Kingdom can touch our level of provision. The Labour party are just going to have to suck that up.

[Valerie Vaz (in the Chair)]

The hon. Member obviously has the title of Mr Scotland. I am afraid I will have to impose a very informal time limit of around four minutes so that everyone is able to get in.

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[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.

[Valerie Vaz (in the Chair)]

We are going to have to go down to an informal three-minute limit to get everyone in.

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[Dave Doogan]

The hon. Gentleman mentions the litany of failures, as he sees them, in Scotland’s NHS. How then does he explain that spending per head is greater than it is the rest of the UK, that the number of doctors per 100,000 people is higher than it is the rest of the UK, that the number of nurses per 100,000—

[Valerie Vaz (in the Chair)]

Order. I call Torcuil Crichton.

[Dave Doogan]

His airlifted constituents—

[Valerie Vaz (in the Chair)]

Order. You have had 10 minutes, Mr Doogan. I am really sorry, but this is unfair to other Members.

[Torcuil Crichton]

I understand the hon. Gentleman’s passionate defence of his own position, but the truth is that, despite higher spending per head in Scotland, that money is inefficiently used on a massive management structure—boards upon boards and quangos upon quangos—that does not put patients first, as evidenced in the Western Isles.

There is no better evidence of these issues than the transport decisions made over my constituents. We have three companies—a Bermuda triangle—running ferry services: CalMac, Caledonian Maritime Assets Ltd and Transport Scotland, with hardly an island representative.

[Torcuil Crichton]

Time is short, my friend, so I must press on.

[Valerie Vaz (in the Chair)]

Order. I must ask you to address the Chair, Mr Crichton.

[Torcuil Crichton]

I am sorry, Ms Vaz.

On ferries, we welcome the very late arrival of the Glen Sannox and soon the Glen Rosa. A minor earthquake welcomed the Glen Sannox through the Sound of Mull as she made her test run. We are glad they are there, but that is only one ferry crisis; there is also the inter-island ferry crisis. The two ferries that connect and hold our Western Isles chain together are limping on, but under the SNP’s replacement scheme they will not be replaced for another decade. Those ferries are meant to have four engines but are running on three. Our road between the isles has also been neglected and run down by the SNP.

I know that time is short, so I will not detain the House much longer. I have mentioned the neglect of rural areas. We see that in rural housing, where we are facing a depopulation crisis and where, from a budget of £25 million for rural housing, only 17 homes have been built in rural Scotland. All this happens because the Scottish Government have a bigger budget. We have no transparency on where that budget is going or how the money is spent. The SNP Government have one year to turn that around. They had better shape up or ship out.

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[Martin Rhodes (Glasgow North) (Lab)]

It is a pleasure to serve under your chairship, Ms Vaz.

The Budget of autumn 2024 marked a significant change—a break from the recent past. For too many years, Scotland and the rest of the UK have suffered from an era of austerity, bouts of ideologically charged fiscal and economic illiteracy, and a failure to invest in the present to deliver for the future. The UK Budget heralded a new era of growth and investment for Scotland. It keeps the promises to Scotland made at the general election: ending the era of austerity, providing billions for public services and prioritising economic growth. As has been highlighted, the Budget delivered the largest funding settlement for Scotland in the history of devolution. In this Budget, we get an end to the flawed, ideologically driven years of austerity—replaced with investment, sound public finance and redistribution. The Budget delivered a pay rise for 200,000 of the lowest paid in Scotland through increases in the national living wage.

A key test of any Budget is how it balances the cost of expenditure with the raising of revenue to cover that expenditure. The significant test is who gains benefits and who covers costs, and how they are balanced. Inevitably, in most Budgets, costs and benefits are spread, but what is key is how the distribution is stacked up. This Budget shows a very clear pattern of redistribution: those with the most bear the greatest costs, and those with the least gain the greatest benefits.

The Budget, together with the Government’s commitment in the new deal for working people and the Employment Rights Bill, indicates a significant and welcome change in direction at the UK level, with direct benefits for Scotland running through it, including investment for economic growth, resources for our public services, an end to austerity and a commitment to redistribution. The Chancellor’s approach—this break from the recent past—needs to be built upon by the Scottish Government; sadly, their recent budget proposals fail to show the leadership required. Despite the record level of funding in the UK Budget for the Scottish Government, the SNP Government have failed to use the opportunity to deliver better outcomes for the people of Scotland in their budget proposals.

I thank my hon. Friend the Member for Livingston (Gregor Poynton) for securing the debate. It is important to have such an opportunity to reflect on the scale and ambition in the UK Budget, turning the page on the recent years of economic ineptitude and missed opportunities and, in their place, securing investment for economic growth, public services and the redistribution of resources. It is a Budget for Scotland and for the rest of the UK.

[Valerie Vaz (in the Chair)]

I call Seamus Logan. Oh, do you not want to speak?

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[Graeme Downie]

I choose not to give way because I am conscious of the time and the others who still wish to speak.

The SNP has fundamentally failed to use the powers of the Scottish Government to grow Scotland’s economy, and has instead presided over low growth and low productivity—areas that this UK Labour Government are now fixing, from which the Scottish Government should be learning lessons. Time and again, they have chosen political division over real progress. The litany of failure is embarrassing and they do not like hearing about it, but here it comes again: millions of pounds of public money wasted on ferries; failed and expensive attempts to fix health and social care; reductions in police numbers; cuts to fire and rescue; longer NHS waiting lists; and higher taxes on working Scots than on people in any other part of the UK. They even robbed Scotland’s offshore wind resources to paper over 17 years of failure. All that lies firmly at the door of the SNP Scottish Government.

Most worryingly, they have failed in fully devolved areas, such as education and skills, to give young people the opportunities and support they need and deserve to fulfil their ambitions and meet their aspirations. The long-term impact of the pandemic on young people is often forgotten, with isolation leading to missed opportunities, lost life experiences and still unknown impacts on mental health. Yet the SNP are telling health boards not to even ask for additional funding, despite the increase in the budget.

SNP excuses must now be at an end. This Labour Government have ended austerity in the UK by delivering the largest Budget settlement in the history of devolution, with an extra £4.9 billion available to spend. It delivers a pay rise for 200,000 of the lowest-paid Scots and ends the injustice of the miners’ pension scheme, giving more moneys to miners in constituencies like mine, with money that will now boost the economies in those areas.

The question for the SNP is: what will they do now that they have run out of excuses? I would hope that they would use the power and funds they have to take action, like finally making good on a promise to build a new health centre in Kincardine that was promised more than 10 years ago in my constituency, or to invest properly in NHS dental services—it is an outrage that there are currently no dentists in my constituency taking on new NHS patients—or to properly fund our police to help to tackle the antisocial behaviour we have seen recently in Dunfermline city centre.

The 2024 UK Budget has delivered for the whole country, and this UK Labour Government are getting on with the job in health, education, transport and the funding of local services, all while the SNP whinge, complain and deflect. It is time for the SNP to take responsibility or get out of the way for a Scottish Labour Government that will get Scotland heading in the right direction once again.

[Valerie Vaz (in the Chair)]

I can get the last two speakers in if they take a minute each.