Question to the Scotland Office:

To ask the Secretary of State for Scotland, with reference to page 49 of Scotland’s Economic and Fiscal Forecasts, published by the Scottish Fiscal Commission in December 2021, what assessment his Department has made of the reason for the increase in PAYE employees between February 2020 and October 2021 being substantially lower in Scotland than other regions and nations of the UK.

The UK and Scottish economies have proven remarkably resilient during the pandemic, and whilst the pandemic is not over, it proves the UK Government’s Plan for Jobs is working, with latest labour market data showing unemployment is down and the numbers of people on the payroll across Scotland above pre-pandemic levels.

The specific performance of Scotland relative to the rest of the UK in the PAYE data is complex. North Eastern Scotland significantly underperforms on this indicator and this is likely to be as a result of its industrial mix and reliance on the oil and gas sector as the Commission suggests. The Commission’s analysis that the labour market impact of the recent upturn in oil prices is probably not reflected in this data release either is one with which the Scotland Office would agree. Moreover, the North East of Scotland’s PAYE data probably dampens Scottish PAYE activity relative to the UK average and, therefore, this is likely to overstate the level of difference between Scotland and the other regions and nations of the UK.