The Economy

Part of the debate – in the House of Commons at 5:51 pm on 8th July 2020.

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Photo of Alistair Carmichael Alistair Carmichael Liberal Democrat Chief Whip, Liberal Democrat Spokesperson (Exiting the European Union), Liberal Democrat Spokesperson (Foreign and Commonwealth Affairs) 5:51 pm, 8th July 2020

I add my voice to those who have pled for more attention and assistance to be given to freelancers. As Richard Fuller said, they are one of the most significant remaining pieces uncared-for sectors in our economy, which requires urgent attention.

Earlier, I welcomed the cut in VAT for the visitor economy. It is disappointing that it is only for six months at the moment. I do not wish to appear ungrateful for that, but the opportunity we have with those six months is that we will have substantial data to know what the effect is. When I was in the Cabinet, we cut the rate of spirits duty by 2p. Despite the Treasury predictions that that would bring in a much lower take for the Treasury, in fact the cutting of the duty brought more revenue at the end of the day. Studies in the past—I confess that I can occasionally be sceptical of studies of this sort—would claim that the take from the visitor economy would be greater with a lower rate of VAT. We will now have the data against which we can measure those claims, and I hope that work will be done in the Treasury.

It seems that the debate is passing on to the next phase, about how we reopen and re-grow our economy. That is difficult in every part of the country, but none more so than the highlands and islands. We need a return to having an economic development force within the highlands and islands with the same vision and purpose that the Highlands and Islands development board had when it was set up by the Wilson Government in 1965. It had access to Government and all the opportunities that could come from the force of the public sector, but added to that, it had the force, vision and experience of business. That was more or less what we got with its successor body, Highlands and Islands Enterprise, but the current Highlands and Islands Enterprise is a sorry shadow of what it used to be.

That issue has been an increasing problem for businesses and economic growth in the highlands and islands for years now, and this is the moment when we have to say, “Enough is enough.” Within the highlands and islands, we need a significant body that has clout and access to Government and can bring the resource of the public sector, but spend it in the way that business and the private sector know is necessary. Without change of that sort, from here and from Edinburgh, we will miss the opportunity to regrow the highlands economy in the way that we know is necessary.