Draft Budget 2018-19

– in the Scottish Parliament on 21st December 2017.

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Photo of Murdo Fraser Murdo Fraser Conservative

3. To ask the Scottish Government how its draft budget will grow the Scottish economy. (S5O-01606)

Photo of Derek Mackay Derek Mackay Scottish National Party

The draft budget delivers more than £4 billion of infrastructure, a 64 per cent uplift in the economy, jobs and fair work portfolio, a new £150 million building Scotland fund, procurement for a £600 million investment in our R100 programme, £2.4 billion in our enterprise and skills bodies and the most attractive system of business rates in the United Kingdom. Those major investments will underpin our focus on innovation, infrastructure and investment, internationalisation and inclusive growth.

Photo of Murdo Fraser Murdo Fraser Conservative

I thank the cabinet secretary for his response and take the opportunity to wish him a very happy Christmas.

In the Finance and Constitution Committee meeting yesterday, we heard evidence from the Scottish Fiscal Commission about its forecast for Scottish economic growth over the next four years, which lags far behind the rest of the UK, as the cabinet secretary will know. Perhaps more worryingly, the forecast for productivity in Scotland also lags far behind the rest of the UK. What specific measures in the cabinet secretary’s draft budget will deliver improvements in productivity?

Photo of Derek Mackay Derek Mackay Scottish National Party

I wish Murdo Fraser a very merry Christmas, and a happy new year when it comes, as well. I think that that is the nicest thing that he has ever said to me in the chamber. It is nice to see the festive season having its effect even on Murdo Fraser.

I do not have enough time in general questions to cover the whole range of actions that will make a difference to economic growth, but I am convinced that the investments that we are putting in place in creating the right competitive environment for businesses, supporting innovation and internationalisation, addressing skills issues and supporting businesses to upskill, grow and take advantage of digital potential will ensure that our economy performs more strongly. Of course the SFC forecasts are absolutely critical to Government, but a range of other forecasts were far more positive about Scotland’s economic prospects.

Photo of Patrick Harvie Patrick Harvie Green

The cabinet secretary mentions the range of non-domestic rates reliefs that he has in place. Is it not the case that there is a lack of evidence about the effectiveness of that rather blunt approach and that we would be rather better off focusing such initiatives on those businesses that achieve some of the social and economic priorities of the Scottish Government, whether that be paying the real living wage, investing in skills or meeting the business pledge priorities?

Photo of Derek Mackay Derek Mackay Scottish National Party

I will be specific on one aspect of that. The Government has committed to undertake a review of the small business bonus scheme in order to ensure that we can maximise its economic and social benefits.

I think that it is true to say that the scheme has been a lifeline to our businesses and it has supported many communities, but we want to make sure that we can do even more with the reliefs and the financial support that we provide to our business community.