Public Finances (Impact of Recession)

– in the Scottish Parliament at on 29 February 2024.

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Photo of Jackie Dunbar Jackie Dunbar Scottish National Party

6. To ask the Scottish Government, in the light of recent Office for National Statistics data, what assessment it has made of the impact on Scotland’s public finances of the United Kingdom entering a recession in 2023. (S6O-03147)

Photo of Tom Arthur Tom Arthur Scottish National Party

The news that the UK has entered a recession represents the latest failure of the UK Government. That will compound the economic challenges that households, businesses and we in the Scottish Government are facing.

Last week, I wrote to the Chief Secretary to the Treasury, and copied in the chancellor, to urge her to provide additional investment in public infrastructure and services in the forthcoming budget. However, at the moment, the reality is that our UK Government capital funding is set to fall by almost 10 per cent in real terms between 2023-24 and 2027-28, which will make it impossible to provide the investment that is needed to underpin future sustainable economic growth.

Photo of Jackie Dunbar Jackie Dunbar Scottish National Party

It is clear that economically illiterate Westminster policies, including Brexit, austerity cuts and cutting labour force migration in key industries, have set the UK on the path to long-term decline. It is vital that future action is taken to support families who are facing financial pressures at this difficult time. We know that most of the powers to tackle poverty and the cost of living remain reserved. Will the minister update me on the Scottish Government’s engagement with the UK Government on the steps that the UK Government should take in the upcoming UK budget to support families who are facing pressures?

Photo of Tom Arthur Tom Arthur Scottish National Party

Last week, the Deputy First Minister wrote to urge the chancellor to provide further targeted support for people who are struggling. That must include an essentials guarantee, which would provide the most basic of necessities and benefit 8.8 million families. We have again called for the abolition of the two-child limit, the benefit cap, the young parent penalty in universal credit and the bedroom tax. We are doing what we can to mitigate the effect of those damaging policies, but we cannot mitigate everything. The chancellor needs to take action to support vulnerable families in his budget next week.