Meeting of the Parliament 31 January 2018
I have given way once already and I need to make progress. It is on the record and the finance secretary can read it for himself.
Any cuts that are being made and any tax increases are purely the result of SNP choices; they are no one else’s responsibility. When we hear SNP members talk about austerity, let us be clear of the fact, stated by the Fraser of Allander institute, that, in real terms, the discretionary spend of the Scottish Government today is equivalent to what it was in 2006-07—the year in which it took office. Over the 10 years of this SNP Government, there has been no real-terms cut in its discretionary spending. That is an undeniable fact, and it puts into context everything that we hear from the SNP about austerity and cuts.
In many ways, the real story of this budget came not in the statements from the finance secretary but in the publication last month by the Scottish Fiscal Commission of its forecasts for economic growth in Scotland. Those forecasts were deeply worrying, for they predicted that the SNP-run economy in Scotland will fail to match UK growth in each of the next five years. They said that, in 2018, the SNP-run economy in Scotland will grow at half the rate of the UK economy as a whole. Scotland is also projected to have the lowest growth of any major economy—in the European Union, in the G20 or in the Organisation for Economic Co-operation and Development—over the next three years. That failure to match even the average UK economic growth for the period from 2007 to 2022 will amount to a growth gap in Scotland that is worth a staggering £16.5 billion in cash terms.
We need to put growing the economy first: that is the way in which we generate the tax revenues that we need. That is why the message from every business organisation in advance of the budget was the same: do not increase the tax burden. The Federation of Small Businesses, the Scottish Chambers of Commerce, the Confederation of British Industry in Scotland, Scottish Engineering and the Scottish Retail Consortium all warned that taking money out of people’s pockets and reducing consumer spending at a time when we need to kick-start economic growth is not the way to go. Even Business for Scotland, the independence-supporting lobby group, backed that call not to increase income tax.
Now, the SNP used to agree with us. It used to say that it was possible to use tax as a lever to grow the economy and generate additional tax receipts. Alex Salmond and John Swinney used to argue for lower corporation tax. SNP members of Parliament for the north-east—back in the days when there were more than one of them—used to argue for tax cuts for the North Sea oil industry. In 2016, 44 SNP MPs—yes, there used to be 44 of them—called for a reduction in VAT in tourism, which was echoed by Richard Lochhead in February 2017. In 2012, Fiona Hyslop demanded a reduction in VAT on repair and maintenance costs, and was backed by Alex Neil. Nicola Sturgeon, John Swinney and Derek Mackay have all argued for a cut in air passenger duty to boost economic growth—a call that was backed by John Mason in a motion in this Parliament just two weeks ago. The SNP is happy to call for tax cuts when it suits it, but when it actually gets power over taxation it breaks its promises and puts up taxes.
This budget should have been a programme for growth. It should have concentrated on cutting out the waste in the Scottish Government. It spent £132 million on delayed discharges in the NHS, £170 million on agency staff due to poor workforce planning and £180 million on an information technology system for farm payments that does not work. It should have cut out the vanity projects and concentrated on growing the economy. Two weeks ago, in the SNP’s now-notorious party-political broadcast, we were asked, “What has the SNP ever done for us?” It has broken its promise on tax, cut services and ignored the interests of the business community and the Scottish economy.
This is not a budget that is fit for purpose. It is bad for business, bad for the economy, bad for taxpayers, bad for families and bad for services. That is why this Parliament should reject it.
I move amendment S5M-10183.1, to insert at end:
“, but, in so doing, regrets proposals to increase tax for 898,000 basic rate taxpayers, which breaks an SNP 2016 manifesto pledge.”
15:14Motions, questions or amendments mentioned by their reference code.