SNP Budget must rebuild Scotland’s economy and public services

The Scottish Conservatives are demanding the SNP deliver a budget to rebuild Scotland’s struggling economy and public services today.

The party wants to see Finance Secretary Kate Forbes use the record funding settlement from the UK Government to put Scotland on the road to recovery from the pandemic – and ignore the anti-business voices of her Scottish Green cabinet colleagues.

The key measures Shadow Finance Secretary Liz Smith is calling for include:

  • A £631 million business support package, comprising a freeze on the poundage rate payable by businesses and a full year of 75% rates relief on the leisure, hospitality, retail, aviation and newspaper sectors
  • To pass on the full £2.1 billion in UK health consequentials to boost an NHS in deep crisis on Humza Yousaf’s watch
  • Increase local government funding by £1.2 billion – its share of the Block Grant rise - to help councils that have endured years of SNP funding cuts
  • £62 million in additional justice funding to tackle Scotland’s rising crime levels
  • £55 million for reinstating the Help to Buy scheme to enable people to get on the property ladder for the first time

The Scottish Conservatives believe this package of measures will boost the economy and ease the pressure on vital services that were already overstretched even before the pandemic.

Scottish Conservative Shadow Cabinet Secretary for Finance and Economy Liz Smith MSP, said: “Scotland’s economy and public services have taken a huge hit during the pandemic, so this budget has to be about recovery.

“The choice for the SNP is stark: stand up for ordinary, hard-working Scots or stand up for their extremist, anti-business Scottish Green coalition partners.

“The SNP have to make the most of the record funding settlement from the UK Chancellor - and the package we’re proposing would do just that.

“Scottish businesses have been devastated by Covid and our extensive rates relief plans would give them the essential breathing space to recover and rebuild.

“Kate Forbes also needs to invest more in Scotland’s crisis-hit NHS by passing on the £2.1billion in UK health consequentials to tackle the huge backlog of patients awaiting treatment.

“Similarly, she must pass on the proportionate share of her increased budget - £1.2 billion - to councils, which have endured years of SNP cutbacks. Local services, such as libraries, leisure centres, bin collections and street lighting, are crying out for investment.

“The SNP have the chance to make a real difference with this budget - they must not squander it.”

 

Notes:

£631 million in rates relief - The SFC estimate that the cost of applying a 100% relief to these premises for 9 months is £558 million in 2021/22. Their latest estimate for freeing the poundage this year was a cost of £63 million. Using a similar proportion of rates income in 2022/23, we estimate that offering 75% relief on leisure, hospitality, retail, aviation and newspaper businesses would cost £567 million and that freezing the poundage rate on all premises would cost £64 million using the latest SFC estimates.

SFC, Scotland’s Economic and Fiscal Forecasts – August 2021, 26 August 2021, p57, link; SFC, Scotland’s Economic and Fiscal Forecasts, 28 January 2021, p56, link.

£2.1 billion for the NHS and social care – Health spending in England is due to increase from £156.4 billion to £178.5 billion, an increase of £22.1 billion. This will lead to health consequentials of £2.1 billion. A significant proportion of this funding is coming from the new Health and Social Care Levy. HMT, Statement of funding policy: Funding the Scottish Government, Welsh Government and Northern Ireland Executive, October 2021, p43+46, link.

£1.2 billion increase in funding for local government - According to the Local Government Finance Circular, funding for Local Government was £11.6 billion of which £259 million was non-recurring Covid funding. The Block Grant from the UK Government to the Scottish Government is due to increase by 10.6% next year. Applying the same increase to local government funding would mean a 10.6% increase in funding next year which would be an additional £1.2 billion distributed to councils.

HMT, Autumn Budget 2021, October 2021, p182-186 link; Scottish Government, Local Government Finance Circular No 1/2021, 1 February 2021, p7, link.

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