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Increased investment 'essential'

Published: 20 Nov 2016 00:01
Part of:
Economy

Finance Secretary calls for growth in wake of Brexit.

The Chancellor must end austerity in light of the weak economic outlook and take steps to boost growth, support business and help the most vulnerable, Finance Secretary Derek Mackay said today.

Writing to the Chancellor ahead of the autumn statement, Mr Mackay called on the Chancellor to commit to a range of economic measures, including:

- continued membership of the EU single market

- a package of support for the North Sea – including improved access to decommissioning tax relief, delivering loan guarantees and stimulating exploration

- a halt to harmful welfare cuts – including reversing both the benefits freeze and the reduction of the benefit cap

- allowing our emergency services to reclaim VAT in line with other countries across the UK to reduce the financial burden they face by £30 million per annum so that the Scottish Government can use this saving to deliver front line services

Mr Mackay said:

“The Chancellor has taken no action to ease the uncertainty felt in the wake of Brexit – it is now more essential than ever that we invest in our economy and stimulate growth.

“I have written to the Chancellor to urge him to end the damaging austerity agenda and set out key measures he should take such as providing support for the North Sea industry, which continues to be impacted by low oil prices, and ensuring continued access to the single market for our businesses and consumers.  

“In stark contrast to the silence and inaction of the UK Government we have taken swift action in the wake of Brexit to support the economy by bringing forward an additional £100 million of capital investment.  We are working hard to secure Scotland’s continued relationship with Europe and have already set out plans for a £500 million Scottish Growth Scheme to support businesses.  

“This government is already facing real terms cuts from the UK Government every year until at least 2019-20 – further reducing funding for our public services and undermining our work to build a fairer country. Our discretionary budget will have been cut by £3.3 billion in real terms, or 10.6%, since 2010-11 and within this, our capital budget will have fallen by £600 million or 15.7% - this is unacceptable.

“The approach towards how we grow our economy could not be more different between our two governments. We set out strong ambitions in our Programme for Government around the NHS, early years, closing the attainment gap and supporting business.  I look forward to publishing the Scottish Draft Budget next month that will support our economy, tackle inequality and provide high quality public services for all.” 

Background

The Scottish Government has set out key commitments in its Programme for Government around the NHS, early years, attainment, policing and support for business - aimed at supporting the economy, tackling inequality and providing high quality public services. http://www.gov.scot/programme2016

A copy of the Cabinet Secretary’s recent letter to the Chancellor is attached for information.