Meeting of the Parliament 05 February 2020
Why have a budget debate once when you can have one three, four or five times? I am delighted to be here again to talk about the budget, which will be published tomorrow in the context of unprecedented uncertainty. The UK Government’s decision to defer the UK budget from 6 November to 11 March means that we still do not have the certainty that we would normally have when we publish our budget for the coming year.
We have been forced to publish our budget ahead of the UK Government’s budget in order to provide the clarity that local authorities, third sector organisations and ratepayers expect. Without the UK Government’s tax and spending decisions and the updated fiscal forecasts, we do not have as much clarity on public services as we would like. As the Scottish Government’s budget will come out before the UK Government’s budget, I can only assume that the Tories’ call for no tax divergence is actually targeted at the UK Government, which will have the opportunity to replicate the Scottish Government’s decisions to reduce any such divergence.
As a responsible Government, we have a duty to balance our budget this year, as we have done every previous year. We are well aware of the challenges that the Fraser of Allander institute has set out. It is worth reflecting on the points that have repeatedly been made by the Conservatives about the so-called Boris bonus, because, since 2010, the Scottish Government’s budget—in terms of day-to-day spending—has fallen. That is the reality of UK Government funding over that decade. I do not think that even Murdo Fraser would argue that this year’s potential increase in funding reverses the decade of austerity that the Scottish Government has had to operate in.
By contrast, the Scottish Government has taken action to deliver certainty for our public services. That can be seen in relation to, for example, local government funding, with the finance spokesperson for the Convention of Scottish Local Authorities saying that councils in Tory-run England and Labour-run Wales are “collapsing”, whereas, in Scotland, we see local government working in partnership with the Scottish Government to ensure that the people of Scotland receive the services that they expect.
I will turn to the specifics that have been raised in the amendments and in members’ interventions so far. We recognise that tomorrow is an important day. It is important because it will provide clarity and because it will continue the theme that the Government has been developing over the past few years with regard to ensuring that our partners in local authorities are protected from the austerity that we have been at the receiving end of.
The Cabinet Secretary for Finance, Economy and Fair Work will announce his tax policy proposals in tomorrow’s budget. Of course, I will not be drawn on those today, but we continue to ensure that Scotland is subject to the fairest and most progressive taxes in the UK. In fact, since the Fraser of Allander institute has been consistently quoted in every budget debate, it is worth quoting that, last year, it said:
“We estimate that the Scottish income tax policy raises approximately around £550 million in revenue compared to a policy to set the same tax parameters as in the UK.”
The question for the Conservatives is, where would they have made cuts in order to meet that £550 million shortfall in the past year?