To ask the Scottish Government what assessment it has made of the impact that Brexit is having on Scotland’s economy. (S6O-03552)

Scotland’s economy is continuing to suffer from the effects of the United Kingdom’s exit from the European Union, a decision that the Scottish public were strongly against. The latest modelling by the National Institute of Economic and Social Research finds that the UK economy is currently 2.5 per cent smaller than it would have been as an EU member. It is estimated that that figure will rise to 5.7 per cent by 2035.

Businesses continue to feel the difficulty of new trading arrangements. The latest results from the business insights and conditions survey showed that, of the businesses with 10 or more employees in Scotland that faced challenges with exporting, 38.5 per cent named Brexit as the main cause. That figure rose to more than 40 per cent in sectors such as manufacturing, retail and wholesale.

The National Audit Office has reported that more than £4.7 billion of public money is forecast to be spent on post-Brexit border arrangements, and His Majesty’s Revenue and Customs has estimated that customs declarations could cost UK businesses around £7 billion every year. Can the minister provide any update on what assessment the Scottish Government has made of the continued cost of Brexit to the taxpayer and to businesses—unlike both Labour and the Conservatives, who wish to deny that it is happening?

As outlined, the latest analysis by the NIESR suggests that the UK economy was around 2.5 per cent smaller in 2023 than it would have been under continued EU membership. That means that around £69 billion was wiped from national income in 2023, which equates to £28 billion of tax revenue. In Scotland, that equates to lower public revenues of around £2.3 billion in 2023.

Brexit has also added further fuel to the cost of living crisis. Research by the London School of Economics centre for economic performance suggests that an increase in trade barriers has pushed up average household food costs by £250 since December 2019. Those costs disproportionately impact low-income households, who spend a greater proportion of their income on food.