Public Spending: Budget 2021

What assessment he has made of the effect of Budget 2021 on public spending in Scotland.

What assessment he has made of the effect of Budget 2021 on public spending in Scotland.

The Budget confirmed an additional £1.2 billion for the Scottish Government in the next financial year. Taken together with the allocation at the last spending review, it means the Scottish Government will receive an additional £3.6 billion of funding in 2021-22 through the Barnett formula, on top of the baseline of £35 billion.

The A1, the east coast main line and the national grid all run through East Lothian, but as this virtual call shows, broadband is as vital as older forms of infrastructure. East Lothian has lower than average download speeds and less gigabyte capacity than many parts of the worst 10% of areas in the UK. Is this a Brexit bonus or the price of the Union? What is the Minister doing to ensure that adequate spending is there to provide the connectivity that East Lothian and Scotland require?

As my right hon. Friend the Secretary of State has mentioned in his answers to previous questions, we have just published the interim report on the Union connectivity review, which emphasises the need for better connectivity across all transport modes between Scotland, England and the rest of the United Kingdom. On the question of broadband speeds, of course the recent pandemic has underlined the importance of having good digital connectivity, and this Government are investing substantially in improving broadband speeds right across the United Kingdom.

Scotland is delivering a pay rise for public sector workers while the UK Government are instituting a real-terms pay cut for their public sector staff. Does the Minister not appreciate that, as well as being unjust and a real failure to recognise the hard work of the public sector, this decision also harms the Scottish Government’s ability to pay our Scottish public sector staff adequately?

I should point out that I am not responsible for public sector pay, either in Scotland or England, but I will relay the hon. Lady’s points to my colleagues who decide these matters. We will want to be as generous as we can be, while also keeping one eye on the overall state of the public finances. We have to keep that under control. As the Chancellor announced last week, if the international financial markets take fright at the state of our public finances, we will end up in a far worse financial position than we are currently in. Of course, if the Scottish Government wish to increase public sector pay more than in England, they have the fiscal powers at their disposal to do so.

The United Kingdom Internal Market Act 2020 grants UK Ministers the ability to provide financial assistance, particularly from the shared prosperity fund, to any person for purposes that are outlined in the Act. However, there is still no detail as to how this will work in practice or what conditions will have to be met to qualify for such funding. Last month, a Scotland Office Minister told the Scottish Affairs Committee that further details on this matter would be provided in the now published Budget, so could the Minister outline those details for us, please?

I point the hon. Lady to the prospectuses for the first stages of the community renewal fund and the levelling-up fund, which were published alongside the Budget last week. This is about real devolution. This is about empowering local communities, local authorities and other stakeholders to come forward with the schemes that they think are best for their local areas, to help bounce back after the coronavirus pandemic and put in place the innovation and investment that will help economies grow and secure the jobs of the future.

That Scotland Office Minister also told the Scottish Affairs Committee that there will be an opportunity to engage with stakeholders on a lot of the concerns that still exist, so could the Minister tell us what those opportunities are? When will they be made available to us?

The work we are doing will build on the very strong relationships that already exist, such as through the city region and growth deal programmes. Shortly after this session, I will be speaking to the Glasgow area policy conference on these matters. When I spoke to them a few weeks ago, the SNP leader of Glasgow City Council told me that they have developed a very effective network with the local authorities in the Greater Glasgow area, with universities and with the private sector, and are putting forward exciting bids for their future growth. It is those community-led, area-led projects that we want to encourage through our different funding streams.

Last week, we finally saw the Chancellor move the cliff edge for the most vulnerable by announcing that the £20-a-week cut to universal credit for millions of families will be moved by just six months. Citizens Advice Scotland has shared that removing the increase will result in nearly 60% of CAB complex debt clients being unable to meet their living costs. What steps is the Minister taking to ensure that the least well-off in Scotland are not impacted by the Chancellor’s constant dither and delay on ensuring that universal credit is high enough to support all people across Scotland and the United Kingdom?

Before I answer the hon. Gentleman’s question, may I, through him, extend my congratulations to Anas Sarwar on his election as leader of the Scottish Labour party? It is a significant moment, and he will be a doughty fighter in the upcoming Holyrood elections.

On universal credit and our route map, although all the indications are that the economy will be back up and running by the end of June, we have taken the prudent step of extending not just universal credit but furlough and some of the other support schemes to the end of September, just in case there is a delay in getting things up and running. The uplift to universal credit was always designed to be temporary, to help families through the pandemic, and the system has worked well. I take this opportunity to pay tribute to all the civil servants who have administered universal credit at a time of unprecedented demand in a very effective way.

The long-term arrangements for social security payments will be determined at the forthcoming spending review in the normal way. Of course, the Scottish Government also have the opportunity to supplement those payments with their own welfare powers.

While the UK Government are extending rates relief for only three months in England, the Scottish Government are doing so for the whole year, helping the retail, hospitality, leisure and aviation sectors. The Scottish Government want to go further still, so will the Minister support Scottish businesses by calling for the full devolution of financial powers to Scotland?

I thank the hon. Gentleman for his question. It is not correct to say that the business rates holiday is only being extended for three months; a period beyond that is specially targeted at businesses in the tourism, hospitality and entertainment sector. In addition, for England substantial restart grants are available, the money for which is Barnettised to the Scottish Government, who are able to spend that as they see fit.