Covid-19 Fiscal Implications

Part of the debate – in the Scottish Parliament on 16th June 2020.

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Photo of Michelle Ballantyne Michelle Ballantyne Conservative

No one doubts that the economic consequences of Covid-19 will take years to recover from. Equally, there is a recognition across the chamber that the UK and Scottish Governments have stepped up and responded financially in a manner that has not been witnessed before. Billions of pounds have flowed to Scotland under the fiscal framework to support individuals and businesses at this critical time, with £3.7 billion now expected to come directly to the Scottish Government through Barnett consequentials. The cabinet secretary is correct that initial announcements are estimates but, so far, throughout the crisis, the figures have been revised upwards and not downwards.

Since the start of the cabinet secretary’s tenure, rather than the start of the pandemic, she has repeatedly called for borrowing powers and a change to the fiscal framework. Last week, I asked the cabinet secretary whether she is saying that she wishes to keep all the current benefits and consequentials and add more borrowing powers on top of that, but I am still waiting for an answer. In the speech that we have just heard, the member pointed out that all taxpayers will have to pay the bill. If we add more borrowing powers, Scottish taxpayers will have to pay more towards the bill. That will not help; it will hinder.