Expenditure and Taxation Levels

Oral Answers to Questions — Scotland – in the House of Commons at 1:50 pm on 20th November 1996.

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Photo of Mr Barry Field Mr Barry Field , Isle of Wight 1:50 pm, 20th November 1996

To ask the Secretary of State for Scotland what recent representations he has received on (a) expenditure and (b) taxation levels in Scotland. [3464]

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I have received a number of representations on expenditure and taxation levels in Scotland.

Photo of Mr Barry Field Mr Barry Field , Isle of Wight

Is it not a fact that the cut in duty has brought a warm cheer to the Scotch whisky industry of Scotland—more than adequate compensation for a cool climate? Is it not also a fact that the Scottish people get an excellent bargain from the Government and the British taxpayer? They have more Members of Parliament per head and more expenditure per head than the people of the Isle of Wight, yet they still mutter and moan into their sporrans. If we had that level of expenditure per head on the Isle of Wight, we would do an island fling.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

It is certainly true that my right hon. and learned Friend the Chancellor of the Exchequer broke with the tradition of 100 years in last year's Budget by cutting the duty on whisky for the first time. I hope that that splendid new tradition will be continued.

My hon. Friend is right to say that Scotland enjoys considerably higher levels of public expenditure. I believe that that is a benefit for the Union. Despite what I am sometimes tempted to think when looking at Opposition Members, I also believe that it is a benefit for Scotland to have proportionately more Members of Parliament. In addition, we enjoy the office of Secretary of State—a Cabinet post that provides an important strong voice for Scotland. All those factors—the higher expenditure level, the representation at Westminster and the role of the Secretary of State—would be destroyed by Labour's plans for a tax-raising Parliament.

Photo of Tommy Graham Tommy Graham , Renfrew West and Inverclyde

Is the Secretary of State aware of the acute crisis in local authorities caused by his Government's savage cuts? Next year, a catastrophic unemployment rate will escalate among local authority workers who provide the services for our people. There will be further cuts in home help and in all local authority services because of the Government. Local government services will once again be decimated.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

I hope that the Minister heard a question. I did not. Perhaps he would respond anyway.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I prepared an answer earlier. I think that the hon. Gentleman's question was about the need for more local authority expenditure. I draw his attention to Glasgow. Last year, I gave Glasgow an additional £15 million in aggregated external finance and was criticised by the hon. Member for Hamilton (Mr. Robertson). We now find that the council is unsure of how many social workers it employs in its social work department. It does not know the number. It has also overspent its budget by £3.5 million. Local authority expenditure in Scotland is 30 per cent. higher than in England. Grant support from central Government is 44 per cent. higher. The problem with local authorities in Scotland is that they are run by the Labour party, not that they are underfunded by the Government.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Will my right hon. Friend confirm that half of the United Kingdom regional aid budget was spent in Scotland last year? If a Scottish Parliament were established, does he believe that that would continue?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I do not believe that it would continue. It is hard enough maintaining that level of expenditure at present, given our voice in the Cabinet, our representation, and our ability to make our case where the decisions on funding would continue to be made even if we had a Scottish Parliament. I do not believe that that level would be sustained, nor do I believe that the additional advantage of the £3.8 billion of expenditure on public services in Scotland, which we enjoy, would continue.

Photo of Alex Salmond Alex Salmond Leader, Scottish National Party

Does the Secretary of State accept that, even using his Department's methodology, and allowing for Scotland's share of UK public borrowing and, of course, our share of our own natural resources, the fiscal surplus of Scotland in the past 17 years amounts to £80 billion, or £16,000 a head for every man, woman and child in the country? Can we arrange a seminar at which those facts could be explained to hon. Members such as the hon. Member for Isle of Wight (Mr. Field), which is seeking independence I understand, so that they can answer this simple question: if they really think that Scotland is subsidised, why are they so anxious to hang on to us?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

Because, unlike the hon. Gentleman, we are Unionists and because we place the interests of our country before narrow nationalism, which would impoverish Scotland and damage our public services. The hon. Gentleman is on to an idea, however. We should have a seminar, and he and the hon. Members for Hamilton (Mr. Robertson) and for Orkney and Shetland (Mr. Wallace) could come along. We could study Scotland's budget and hear where the Opposition parties' priorities would lie. I would be happy to organise that—let us do it next week.

Photo of John McAllion John McAllion , Dundee East

If expenditure levels are so much higher in Scotland, can the Secretary of State explain why the Government recently allocated £25 million to 13 towns in England to pay for the rough sleepers initiative when not a penny was allocated to any town or city in Scotland? That is an absolute disgrace, especially when we remember that surveys north and south of the border have shown that more people are sleeping rough in one small part of Glasgow city centre than in any of the 13 towns to which the Government handed those millions of pounds. Why does the right hon. Gentleman not fight in the Cabinet for Glasgow and other Scottish towns? If he is not prepared to fight, he should go.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

It is absurd for the hon. Gentleman to compare housing expenditure in England and in Scotland. He should look at what is happening in his city and throughout Scotland—levels of expenditure on housing in Scotland are way above those in England. In so far as we have given—

Photo of John McAllion John McAllion , Dundee East

I asked about the rough sleepers initiative.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

Well, we have put the money into creating homes for people to live in, and we have a record of improvement, refurbishment and creating new housing in Scotland to which no Labour Government could hold a candle.