Spending Round 2019

Part of the debate – in the House of Commons at 1:43 pm on 4th September 2019.

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Photo of Kirsty Blackman Kirsty Blackman Shadow SNP Spokesperson (Economy), SNP Deputy Leader 1:43 pm, 4th September 2019

I thank the Chancellor for advance sight of the statement.

The gimmicks and gems the Chancellor has presented today are nothing more than an effort to distract us from the crippling crisis that the Government are dragging us into. If that was meant to be a pre-election Budget, if I was a Back-Bench Tory I would be quaking in my boots right now. In less than two months, we could face a no-deal Brexit, unless that threat is removed today by the House of Commons supporting the cross-party Bill to secure an extension. The threat cannot be underestimated. We are standing here facing increased uncertainty due to Brexit. The outlook for our economy and for public finances remains extremely uncertain. The economy has already taken a hit, as we saw GDP contract 0.2% in the second quarter of 2019. As Paul Johnson of the Institute for Fiscal Studies put it in The Guardian,

“Making big fiscal announcements in a period of great economic uncertainty means we will have little idea how sustainable or costly decisions made this week will be. The risks are exacerbated by not having up-to-date forecasts from the OBR.”

While the Chancellor has announced increased spending today, this will not help to end austerity; it will only pause some of the hardship in the short term. Meanwhile, Brexit will bring lasting and long-term damage to our economy, and to our citizens’ livelihoods.

With the economy already faltering, the Chancellor’s predecessor has warned that a disruptive no-deal Brexit could have a £90 billion hit on the Exchequer and suggested there would be no money available. A no-deal Brexit would be devastating for Scotland, with the potential to destroy 100,000 Scottish jobs and cost every person the equivalent of £2,300 a year. Brexit caused UK manufacturing activity to contract in August for the fourth consecutive month to the lowest level since 2012. According to the BBC, sterling fell below $1.20 on 3 September to its lowest since October 2016. The Chancellor pretends his Government are putting people first, when in reality they are putting the cult of leave campaigners and their Brexit obsession before the interests of the economy and citizens.

Yesterday in Scotland the First Minister announced our programme for government, putting tackling climate change, protecting our economy and reducing inequality at the heart of our policy-making agenda. Here we are talking about food and medicine shortages, reducing opportunities for our young people and complete Brexit chaos. For the people of Scotland, this is a tale of two Governments, and only the SNP Scottish Government are acting in our interests.

The IFS is clear that pre-election bribes do not mean an end to austerity—that decade of austerity that cumulatively cut the Scottish block grant by more than £12 billion in real terms, left people having to choose between heating their homes and feeding their children and reduced social security payments for disabled people four times faster than the cuts for others.

If the Tories seriously wanted to make life better for citizens, they would give Scotland its fair share. This means the Chancellor should repay the £140 million of VAT owed to Police Scotland in refunds. We have been arguing for years for the convergence uplift moneys to be returned. There are 50 mentions of it in Hansard, 45 of them from the SNP, and most of the others in response to SNP questions. I am pleased with the pressure that we and our colleagues in the Scottish Government have brought to bear on this Government. It also means that Scotland must get its £3.4 billion share of the DUP’s dirty deal Brexit bung. Will the Chancellor rule out any new confidence and supply agreement with the DUP that would give them more money before we get the £3.4 billion we are owed?

Furthermore, it would appear that the Chancellor will overshoot his Government’s borrowing targets. Will he confirm that, and will he tell the House what borrowing rule changes he will introduce in the Budget? Will he guarantee that Scotland will not lose any of the EU funding it currently receives? The UK Government must, at the very least, match the compensation scheme already put in place by the EU and the Irish Government for the beef and suckler sectors in Ireland.

Finally, the Government must scrap the proposed £30,000 salary limit on foreign nationals entering the UK. Scottish Government analysis has found the average EU citizen in Scotland adds £10,400 to Government revenue and £34,400 to GDP each year. The proposed £30,000 salary limit on foreign nationals to the UK has been shown to be unworkable and should be scrapped. While the Tories balance the books on the backs of the most vulnerable and disadvantaged, the SNP Scottish Government are leading the way to deliver a fairer Scotland.