Chamber
Meeting of the Parliament 07 December 2011
07 Dec 2011 · S4 · Meeting of the Parliament
Item of business
Autumn Budget Statement and the Scottish Economy
The growth rates are very disappointing, but if one looks at the OBR report in full—not just the press release that accompanied it—one sees that, although the prediction for growth in the UK in 2012 is a disappointing 0.7 per cent, the growth prediction for the euro zone for 2012 is 0.5 per cent. The euro zone therefore has a lower predicted growth rate for 2012 than the United Kingdom.
I have only a minute left, but my colleagues Mary Scanlon and Murdo Fraser will talk more about the positive measures that the UK Government has taken in the autumn statement. On credit easing, although the details are awaited, there will be £20 billion of guarantees for bank funding to be made available over two years. That will allow for lower-cost lending to smaller businesses—perhaps a full percentage point lower.
We have also had the cancellation of the August rise in fuel duty and the postponement to August of the January rise. The Institute of Chartered Accountants of Scotland said that that
“will have a direct impact on employability and household spending.”
There will also be £433 million-worth of increases in capital spending over the course of the next three years.
The growth figures were disappointing, but we have to look at the reasons for them and the potential impact once inflation decreases over the next couple of years. There were positive measures in the autumn statement, and it is right that they are put on the record.
I move amendment S4M-01501.1, to leave out from “that the Office” to end and insert:
“and welcomes the numerous measures in it that will help people and businesses across Scotland, including the Chancellor’s commitments to fund an ambitious programme of infrastructure investment that will result in an additional £433 million for Scotland, to implement a package of credit easing measures to protect the flow of credit to smaller and medium-sized businesses, freeze fuel duty, make £50 million available to enable the replacement of the Caledonian Sleeper fleet, introduce the Youth Contract, which it is estimated will create opportunities for tens of thousands of young people in Scotland, including apprenticeships and work experience placements, increase the basic state pension, which will benefit one million older people in Scotland and invest in broadband through an urban broadband fund, which will create 10 super-connected cities in the UK including Edinburgh, and therefore calls on the Scottish Government to amend its draft budget to reconsider cuts in areas that help the economy, scrap the anti-competitive retail levy and demonstrate exactly where it is moving revenue spending to capital spending.”
15:48
I have only a minute left, but my colleagues Mary Scanlon and Murdo Fraser will talk more about the positive measures that the UK Government has taken in the autumn statement. On credit easing, although the details are awaited, there will be £20 billion of guarantees for bank funding to be made available over two years. That will allow for lower-cost lending to smaller businesses—perhaps a full percentage point lower.
We have also had the cancellation of the August rise in fuel duty and the postponement to August of the January rise. The Institute of Chartered Accountants of Scotland said that that
“will have a direct impact on employability and household spending.”
There will also be £433 million-worth of increases in capital spending over the course of the next three years.
The growth figures were disappointing, but we have to look at the reasons for them and the potential impact once inflation decreases over the next couple of years. There were positive measures in the autumn statement, and it is right that they are put on the record.
I move amendment S4M-01501.1, to leave out from “that the Office” to end and insert:
“and welcomes the numerous measures in it that will help people and businesses across Scotland, including the Chancellor’s commitments to fund an ambitious programme of infrastructure investment that will result in an additional £433 million for Scotland, to implement a package of credit easing measures to protect the flow of credit to smaller and medium-sized businesses, freeze fuel duty, make £50 million available to enable the replacement of the Caledonian Sleeper fleet, introduce the Youth Contract, which it is estimated will create opportunities for tens of thousands of young people in Scotland, including apprenticeships and work experience placements, increase the basic state pension, which will benefit one million older people in Scotland and invest in broadband through an urban broadband fund, which will create 10 super-connected cities in the UK including Edinburgh, and therefore calls on the Scottish Government to amend its draft budget to reconsider cuts in areas that help the economy, scrap the anti-competitive retail levy and demonstrate exactly where it is moving revenue spending to capital spending.”
15:48
References in this contribution
Motions, questions or amendments mentioned by their reference code.
In the same item of business
The Deputy Presiding Officer (John Scott)
Con
The next item of business is a debate on motion S4M-01501, in the name of John Swinney, on the United Kingdom Government’s autumn budget statement and the Sc...
The Cabinet Secretary for Finance, Employment and Sustainable Growth (John Swinney)
SNP
I am grateful for the opportunity to open the debate on the autumn budget statement and the wider Scottish economy. It is now more than three years since the...
Mary Scanlon (Highlands and Islands) (Con)
Con
In comparing the United Kingdom with France and Germany, does the cabinet secretary accept that the coalition Government inherited the highest level of debt ...
John Swinney
SNP
I know that Mary Scanlon assiduously follows my speeches in the Parliament. She will not have noticed me in any way shirking from apportioning responsibility...
Richard Baker (North East Scotland) (Lab)
Lab
The cabinet secretary has rightly referred to the revision downwards of growth forecasts. What impact will that have on the Scottish Government’s spending re...
John Swinney
SNP
Mr Baker asks a fair question. I point him to the evidence that I shared with the Economy, Energy and Tourism Committee some weeks ago. In the year of greate...
Gavin Brown (Lothian) (Con)
Con
I apologise for missing the start of the cabinet secretary’s speech.In the switch from revenue to capital quite a large sum—about £150 million—will go into t...
John Swinney
SNP
No. The budget proposals rely on a shift from the revenue columns to the capital columns—that is a straightforward transaction in the budget document.
Gavin Brown
Con
The Forth crossing is not in the revenue budget.
John Swinney
SNP
I point out to Mr Brown that the UK Government has of course reduced our capital budget by 36 per cent, which has been moderated to 32 per cent. In the overa...
Willie Rennie (Mid Scotland and Fife) (LD)
LD
The infrastructure plan is a 20-year plan. The increased funding is provided within the first three years. What has been accelerated as a result of the incre...
John Swinney
SNP
Mr Rennie expects me to take a look at those questions, and we will come back to the Parliament, as we will on the other consequentials, to set out how our p...
Neil Findlay (Lothian) (Lab)
Lab
Will the minister give way?
John Swinney
SNP
I would give way to Mr Findlay if—
The Deputy Presiding Officer
Con
Cabinet secretary, you are in your last minute.
John Swinney
SNP
I apologise to Mr Findlay. I will happily deal with his points during the debate.The autumn statement provided some additional capital consequentials for the...
Richard Baker (North East Scotland) (Lab)
Lab
This is a welcome opportunity to debate the autumn statement and its implications for Scotland. It comes at a critical point for our economy and for the worl...
Jackson Carlaw (West Scotland) (Con)
Con
Is it not a consequence of the coalition Government’s strategy that we have the lowest interest rates in the world? Would not a consequence of the Labour Par...
Richard Baker
Lab
I presume that Mr Carlaw would not have acted to bail out the banks. The UK Government has left us the lowest rates of growth in the world, and it has choked...
Gavin Brown
Con
Will the member acknowledge what the Institute for Fiscal Studies has stated? It said that if Labour’s plans had been implemented, they would“now of course h...
Richard Baker
Lab
No, because the figures that I have show that the UK Government plans £37 billion more borrowing in future years than the amount in Labour’s plans that were ...
Gavin Brown
Con
Will the member give way?
Richard Baker
Lab
I have already given way to Mr Brown. I will try to take an intervention from him later.We understand that there will be limited consequentials in the new pl...
John Swinney
SNP
Will Mr Baker take this opportunity to confirm his understanding of the spending review, which involves a rising trend of capital expenditure in Scotland des...
Richard Baker
Lab
My understanding, from what the cabinet secretary said earlier, is that there will be consequentials later in the spending review cycle involving increased s...
Gavin Brown (Lothian) (Con)
Con
It is worth reflecting on some of the analysis and feedback from economists since last week’s autumn statement. The Economist put it simply, stating that“the...
Stuart McMillan (West Scotland) (SNP)
SNP
Does Gavin Brown agree that it is strange that it takes the OBR 18 months to realise that the strategic deficit is worse than planned? What has it been doing...
Gavin Brown
Con
I find it surprising that the member wishes to criticise the OBR, which has received praise for its work from across the political and economic spectrum and ...
Richard Baker
Lab
What is the cost to our economy from the fact that our growth rates are higher than only those of Greece and Portugal, out of the whole euro zone?
Gavin Brown
Con
The growth rates are very disappointing, but if one looks at the OBR report in full—not just the press release that accompanied it—one sees that, although th...