Meeting of the Parliament 24 September 2024
The budget on 30 October will be a significant event. It will be the first budget of the new Labour Government after 14 years of Tory economic mismanagement, and it will be historically significant too, as Rachel Reeves will be the first female Chancellor of the Exchequer to announce a budget. The fourth of December will also be an important date—indeed, arguably the most important date in the Scottish parliamentary calendar—as it will be when Shona Robison gives her budget statement. However, that will be far less unique, in that it will be the SNP Government’s 17th budget in a row. Perhaps the key difference between the two Governments is that it is the Scottish Parliament’s job to hold the Scottish Government to account on the latter, not to grandstand on the former.
The phrase “I will take no lectures” is frequently heard in the chamber. I do not think that I am alone in thinking that it is overused, but what else are we meant to say to the SNP Government when it tries to tell anyone how to manage the public’s finances? The SNP Government needs to get its own house in order before telling anyone else what to do. The reality is that people in Scotland are paying more and getting less under the Scottish Government. Working people in Scotland who are earning only £29,000 are paying more in income tax than their counterparts in the rest of the UK.
Similar to the Tories, the Scottish Government has wasted billions of pounds of Scottish taxpayers’ money since it came to power, because of its incompetence—and that is before we get to the pet projects and the gimmicks—and public services are getting weaker as a result.
The SNP, under John Swinney, Kate Forbes and Shona Robinson, has spent budget after budget failing to focus on growing the economy, never mind delivering it, and we are now paying the price for that failure. According to the Office for National Statistics, since 2014, GDP per head in Scotland has grown by only 4.3 per cent, compared with the rest of the UK, where it has grown by 6 per cent. That means that Scotland’s growth rate is only just more than two-thirds of the UK’s growth rate during the last decade. That has consequences for our economy, living standards and the Scottish Government’s budget. Those consequences have been laid out by the Scottish Fiscal Commission, which said that if the Scottish economy had simply matched the economic performance of the rest of the UK since income tax was devolved in 2016, the Scottish budget would be significantly better off.
Professor Graeme Roy of the commission told the Finance and Public Administration Committee that
“because of relatively slower growth in the Scottish economy since income tax was devolved ... We estimate that the economic performance gap means that the net position in 2022-23 was around £624 million lower than it would have been had Scottish economic performance matched that of the rest of the UK.”—[Official Report, Finance and Public Administration Committee, 3 September 2024; c 3]
That leads, for example, to the SNP making decisions to abandon policies such as free school meals for all primary aged children and to reintroduce peak fares—things that it does not want to talk about today.
Let us not forget that, less than 12 weeks ago, the people of Scotland gave their verdict on the Tories and the SNP when they supported the election of the new UK Labour Government and 37 Scottish Labour MPs. If the SNP wishes to spend time discussing the UK budget, that is of course its prerogative, but it is for its nine MPs at Westminster—that is what is left of them—to take that forward.
Scottish Labour MPs and the new UK Labour Government have been clear that their number 1 priority is economic growth. For nearly three years, the SNP-Green Scottish Government could not even agree on the concept of economic growth, let alone deliver it in any way that could be seen as a priority. Meanwhile, the new UK Labour Government is focused on fixing the foundations to create such growth, so that we can raise living standards for everyone and rebuild public finances to enable us to invest in public services. That will be the budget priority.
As Daniel Johnson mentioned, yesterday, the Chancellor of the Exchequer was clear that there will be no return to austerity—although we should not underestimate the legacy that the Tories have left the new UK Government. Murdo Fraser mentioned borrowing. It is now more than double what it was before the pandemic, and overall debt is now nearly 100 per cent of GDP, which represents the highest level since the 1960s. Before the election, the previous Conservative Government did not factor in the impact of a series of new challenging pressures on the public finances. Spending commitments were made without funding being put behind them. As Mr Johnson said, wrong assumptions were made about this year’s public sector pay award. Therefore difficult decisions might need to be made. Politics is about choices, but this budget is an opportunity to start to turn the page on years of economic mismanagement and for the new Government to deliver on our manifesto commitments.
The new Labour Government’s top priority is economic growth. Key to achieving that will be fixing the foundations of the economy. The UK Government might have changed, but it is clear that the SNP’s approach remains the same: to blame someone else for its own failures, mismanagement and incompetence. This debate has been another attempt to distract from those failures.
As I said earlier, too often in the chamber we hear the phrase “I will take no lectures.” The one phrase that we never hear from either the SNP or the Tories, though, is “Mea culpa.” Perhaps we should hear that more often when we discuss the current state of our public finances.
16:07