THE Chancellor must follow up on a pledge to end austerity with “concrete actions” in tomorrow’s Budget, Scotland’s Finance Secretary has said.
Theresa May told the Conservative party conference earlier this month that austerity is over and “people need to know... that their hard work has paid off”.
However, Derek Mackay has called for a “meaningful uplift” in public services funding from the Budget and said the Conservatives must take “concrete actions” to ensure services are protected.
He said yesterday: “The Prime Minister recently announced she would bring an end to austerity and I want to see this delivered within the UK Government’s Budget. This statement must be backed up by concrete actions to provide a meaningful uplift in funding for public services, in addition to the funding increases announced for the NHS being delivered as a true net benefit and not offset by other cuts to the Scottish Budget.”
Mackay has already written to Philip Hammond asking for the rollout of Universal Credit to be postponed.
Mackay added: “In a letter to the Chancellor this month, I asked for the roll-out of Universal Credit to be postponed until the flaws are fixed, a position supported by the Public Accounts Committee this week.
Yet – as we’re promised an end to austerity – the UK Government continues to press ahead with this damaging policy. This year, working Universal Credit claimants in Scotland will lose £164 million, and around £245m by 2021. We have repeatedly called for a halt to the roll-out until it can be proved not to cause further hardship.”
There was a stark warning to the Chancellor from SNP Westminster leader Ian Blackford as he warned that the Tory Government are “pulling the rug out from under future generations”.
Blackford confirmed yesterday that SNP MPs would not vote for a Budget that would make Scotland poorer, citing failed austerity policies and the need to protect the economy from a Brexit shock by remaining in the single market and customs union.
He said: “Ten years ago, the Labour party presided over the UK financial crash which crippled the economy and kick-started a decade of failed austerity. The Conservatives now risk continued economic uncertainty for future generations with their persistent, damaging, ideological austerity and their utterly shambolic handling of Brexit.
“With the Brexit economic bombshell nearing ever closer, the Chancellor’s Budget must give commitments for the UK to remain in the single market and customs union – which is around eight times bigger than the UK market alone. That is the only way to mitigate the very worst of the Brexit shock to our economy. Closing the door on the single market and customs union risks 80,000 Scottish jobs and would rob each person in Scotland of £2300 – no responsible government could follow such a path.
“SNP MPs simply cannot and will not support a Budget that will weaken Scotland’s economy or makes our constituents poorer.”
The Budget will be no easy task for the Chancellor, who is trying to balance the books in the face of massive uncertainty around Brexit.
Analysts have suggested that national insurance rates and possible changes to capital gains tax will be announced tomorrow, with speculation that some self-employed people will no longer be free from some national insurance contributions.
This weekend the Treasury has trailed two announcements to come in the Budget which will affect England-only: A £30 billion investment package in roads, with a further £420m to go to councils south of the Border to fix potholes after a harsh winter followed by a scorching summer. There will also be a financial package for high streets in England, with £1.5bn earmarked to reduce business rates for nearly 500,000 small businesses and improve infrastructure.
Mackay also repeated calls for a refund on VAT charges imposed on Scottish emergency services and for the UK Government not to impose fees on EU citizens applying for settled status.
He said: “Ending the VAT obligation on police and fire services last year was welcome, but we’re a year on and the UK Government has still not paid back £175m it took before scraping the unfair charges.”
Scottish Labour leader Richard Leonard has called on the Chancellor to change the rules on Universal Credit and child tax credits.
In a letter to Hammond he wrote: “It has been widely reported that the forthcoming Budget will finally end the age of austerity that Britain has lived under for eight years now. If that is the case, the Budget must end the two-child cap on tax credits.
“No single policy sums up the immorality of the age of austerity better than the two-child cap. To punish families by limiting how much support they can get by their number of children is simply wrong.”
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