Business confidence in Scotland rose 13 points to 44% in December
While firms’ optimism in their own trading prospects fell four points to 39%, their optimism in the economy rose 31 points to 49%
Overall UK business confidence dipped three points in November to 41%
Business confidence in Scotland rose 13 points during December to 44%, according to the latest Business Barometer from Bank of Scotland.
While companies in Scotland reported lower confidence in their own business prospects month-on-month, down four points at 39%, their optimism in the economy rose 31 points to 49%. Taken together, this gives a headline confidence reading of 44% (vs. 31% in November).
A net balance of 44% of businesses in the country also expect to increase staff levels over the next year, up 21 points on last month.
Looking ahead to the next six months, Scottish businesses identified their top target areas for growth as introducing new technology (52%), entering new markets (42%) and investing in their team, for example through training (38%).
The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.
National picture
Overall UK business confidence fell two points in December to 39%, although remained above the long-term average of 29%.
While firms’ confidence in the wider economy strengthened five points to 31%, their confidence in their own trading prospects fell eight points to 47%.
London was the most confident UK nation or region in November (53%) for a second month in a row, followed by the North West (50%).
Sector insights
Although confidence fell in the service sector, this was partly offset by rises in manufacturing and retail, with these sectors swapping places in December.
Services fell from 46% to 35% in December – a fall of 11 points. In contrast, manufacturing and retail increased 10 points to 42% and 43% respectively, thereby taking manufacturing and retail above services for the first time in 4 months. Trading prospects for retail rose for the first time in three months, while construction confidence was steady at 41%, equalling last month’s result.
Martyn Kendrick, Scotland director at Bank of Scotland Commercial Banking, said: “It’s encouraging to see Scottish business confidence end the year on the rise, and above the UK average.
“Businesses will be focused on putting their plans for fresh growth into action. We’ll continue to be by their side to support their ambitions.”
Hann-Ju Ho, Senior Economist, Lloyds Commercial Banking, said: “In the last few months overall confidence has fallen incrementally, and in December the trend continued as it fell by 2 points to 39%. While there hasn’t been any significant one-month change, confidence has gradually drifted from the summer’s highs”.
“The key difference in this month’s results is that the fall in confidence is driven by firms’ own trading prospects which have proven to be resilient over the last quarter. There was, however, more positivity regarding the wider economy and, going into 2025, this offers some hope if companies continue to feel confident about the economy.
“Elsewhere, although confidence fell in the services sector, this was partly offset by improvements in manufacturing and retail – which could be a significant for this time of year.”
Paul Kempster, Managing Director for Relationship Management, Lloyds Bank Business & Commercial, said: “The mixed results in trading prospects and economic optimism suggest that while businesses feel they are facing some challenges, there is still some opportunity in regard to the wider economy.
“Although overall confidence dipped this month, we’re still optimistic that firms’ trading prospects will return to the levels seen earlier this year.
“The regional picture is also mixed with significant increases in confidence in Scotland and Northern Ireland, but more acute falls in confidence in the North-East. As we enter the New Year, and businesses across the country consider their plans for 2025, we are committed to helping them to navigate their journey and prosper.”
Chancellor Rachel Reeves and Treasury minister Tulip Siddiq, have opened the 100th banking hub in Darwen, Lancashire.
Banking hubs have been set up in response to bank branch closures, with 350 set to be rolled out by 2029.
High streets up and down UK will be revitalised – helping raise living standards and deliver the Plan for Change
Chancellor of the Exchequer, Rachel Reeves, and Economic Secretary, Tulip Siddiq, have opened the UK’s 100th banking hub in Darwen, Lancashire, which has been set up in response to bank branch closures in the town.
The newly opened banking hub will give customers of the largest high street banks the ability to get cash out, deposit cheques and ensures that local residents have access to face to face banking services.
Kickstarting economic growth is the number one mission for this Government – something cemented in the Plan for Change launched last week, where the Prime Minister redoubled our commitment to raise living standards in every part of the United Kingdom. The roll out of banking hubs will be a significant boost for local people and businesses, helping to revitalise the local high street and raise living standards across the UK.
The opening of the 100th banking hub is a significant landmark on the road to delivering on the government’s manifesto commitment to work with industry to open 350 banking hubs by the end of this parliament.
Rachel Reeves, Chancellor of the Exchequer, said: “Reaching this milestone of 100 banking hubs is a huge step towards making sure that people across the country have access to essential face-to-face banking services.
“High streets are the beating heart of our communities but were neglected for too long under the previous government. We are revitalising our high streets with our target for 350 banking hubs, reforming business rates to make them fairer and clamping down on antisocial behaviour.”
Banking hubs are a collaborative industry initiative, set up in response to bank branch closures onhigh streets across the country.
Instead of one bank owning a branch, the responsibility is shared between the banks. This means that they can share the running costs and all operate in one convenient location.
All customers will benefit from Monday-Friday access to cash and basic banking services via a traditional counter service operated by the Post Office. Community bankers from each of the five banks with the largest number of customers in the area will also come in one day per week to assist their customers with more complex banking issues like debt advice, bereavement services and fraud support.
In the Darwen banking hub, the participating banks are NatWest, Santander, Lloyds, Halifax and Barclays, the banks with the most customers in that location. Opening the banking hub will protect access to cash and banking services for 10,000 local residents and 150 shops within 1 kilometre of Darwen town centre.
The 100th opening is a significant milestone. In September, Economic Secretary secured a historic agreement from industry to deliver on this commitment, with 230 hubs expected to be open by the end of next year, helping to revitalise towns and high streets up and down the country.
Tulip Siddiq, Economic Secretary to the Treasury, added:“We are delighted to see the continued growth of banking hubs, which are playing an essential role in meeting the needs of communities where traditional banking options have declined.
“These hubs are not only vital for residents and businesses, but they also play a key role in revitalising our high streets, bringing footfall back to town centres, and repurposing unused buildings for community benefit.
“The success of these hubs proves that shared banking services can provide a solution that benefits everyone, from residents to local businesses.”
The opening of banking hubs can play an important role in revitalising our high street and repurposing disused buildings in town centres all while providing a vital service to businesses and people in those communities.
Evidence from Brixham in Devon and Rochford in Essex where banking hubs have recently opened has backed this up, research from Cash Access UK the group that run banking hubs shows that almost half of businesses surveyed saying it has increased footfall in the town and 30% of residents saying that they visit the town more regularly and stay for longer because a banking hub has opened in the town.
Gareth Oakley, CEO, Cash Access UK, said:“Access to cash and face-to-face banking services remain vital to millions of people and businesses who rely on it.
“We’re delighted that banking hubs, alongside deposit services are proving to be successful and are making a real difference to communities and high streets up and down the country.”
BiGGAR Economics challenges ‘false narratives’ surrounding Scotland’s self-catering sector now at risk from heavy-handed government regulation
NEW independent analysis from a respected Scottish consultancy reveals the substantial positive economic impact of Scotland’s self-catering industry which was also shown to have a negligible effect on housing.
BiGGAR Economics calculated that short-term lets (STLs) contribute nearly £1bn gross value added (GVA) to the Scottish economy while supporting approximately 30,000 jobs. By accommodating visitors, STLs generate economic activity across Scotland, with the local impacts exceeding residential use, supporting an additional £32,400 GVA per property.
Guests staying in self-catering accommodation, termed ‘secondary lets’ in Scottish STL legislation, also spend more than the average visitor to Scotland, with knock-on gains for related tourist and hospitality businesses. Alongside this huge economic boost, the researchers also highlight that self-catering accounts for less than 1% of the country’s total housing stock.
This challenges the narrative that STLs are fuelling Scotland’s housing crisis, with self-catering at only 0.8% of the country’s housing stock, too low a proportion to have a meaningful impact on local housing markets. Moreover, according to the report, in every local authority area, economically inactive empty homes account for a larger proportion of total dwellings than from secondary lets.
The key headlines include:
STLs are estimated to generate £864m GVA and support 29,324 jobs across Scotland;
Edinburgh and Highland together account for 44% of the total economic impact but the sector’s benefits are dispersed throughout Scotland;
The annual GVA associated with an average owner-occupier/private rented household in Scotland was £14,451, compared to £50,159 for a two-bedroom STL; and
STLs make up a tiny proportion of Scotland’s housing stock, with self-catering accounting for just 0.8%. This is considerably less than the 3.6% that economically inactive empty properties account for.
This study comes as the Scottish Government published an implementation update report on STL licensing which the industry maintains did not adequately address their longstanding concerns. At a local level, councils such as Highland and Edinburgh are also assessing their regulations.
BiGGAR’s new analysis is based on the best available evidence on STLs in Scotland. The findings have been shared with Scottish Government Ministers and officials.
Graeme Blackett, Director of BiGGAR Economics, said:“This report shows that secondary lets make an important contribution to Scottish tourism and economy overall, supporting almost 30,000 Scottish jobs.
“Our research also concluded that it was clear that secondary lets are not a driver of the wider Scottish housing market.
“If short-term let regulations leads to a reduction in the supply of secondary lets, that will have a negative impact on the tourism economy, without delivering any solutions to Scotland’s wider housing challenges.”
Fiona Campbell, CEO of the Association of Scotland’s Self-Caterers, said:“This is yet more compelling evidence that short-term lets aren’t the main contributor of the housing crisis but are instead turbocharging local economies with a near £1bn positive impact while supporting 30,000 jobs.
“The current unbalanced regulatory framework does not reflect this reality and changes are needed before irreversible damage is done.
“Local councils should take heed of the report’s findings when considering their approach to planning policies and control areas to ensure the relatively small number of valuable short-term lets are protected.
“For policymakers, the message couldn’t be clearer: you can’t solve a housing crisis by producing a crisis in Scottish tourism by decimating local businesses that underpin local economies. Attention must shift to the real causes of the housing crisis.”
A range of measures to transform how Scotland attracts and supports capital investment into the country have been unveiled
Deputy First Minister Kate Forbes will take on a cross-government leadership role as the Scottish Government’s ‘Investment Champion’ to deliver a national pipeline of strategic investment opportunities and a seamless, co-ordinated approach to building relationships with investors and developers.
Practical steps being delivered include an Investment Unit to identify and tackle barriers to investment; the creation of a single portal for investment inquiries and another detailing investment opportunities; and a new Cabinet sub-committee to co-ordinate activity.
The Scottish Government will also explore new financing models including how public sector guarantees could be used, a potential Scottish Bond, and public-private partnerships.
Addressing the Investment Association Conference in Edinburgh Ms Forbes said: “Increasing the level of private investment into Scotland’s economy is essential to our ambitions – for growth, for jobs, for reaching net-zero, and for improving our public services. Without investment and the growth it can catalyse, we can achieve none of those goals.
“I will be working to tackle barriers and blockers; and to ensure that the system as a whole works cohesively, effectively, and quickly, to support investors and to deal with issues as and when they arise.
“Scotland has the talent, skills and resources in abundance to be a major player in the energy transition and secure a prosperous and sustainable future. We need to work better, smarter, and quicker to ensure that we can create an investor-friendly environment and seize the many opportunities which lie ahead. ”
New analysis shows how improving employment standards, employee well-being and modernising industrial relations will benefit the economy
TUC General Secretary Paul Nowak gave evidence to MPs as Employment Rights Bill enters committee stage
Making Work Pay agenda is an “urgent national mission” that is “good for workers and good for business”, says union body
New TUC analysis published yesterday (Tuesday) shows that even modest gains from the government’s workers’ rights reforms would benefit the UK economy by over £13bn a year.
The analysis models some of the key benefits of the Employment Rights Bill – identified by the government’s impact assessment of the Bill.
The research shows that even if the Bill just delivers small improvements in areas such as employee wellbeing, industrial relations and labour market participation the economic gains will outweigh any costs.
The analysis looks at the scale of the benefits implementing the Employment Rights Bill could bring across a range of workplace measures:
Workplace stress: Between £490 million and £974 million would be gained by reducing the number of working days lost to stress, depression or anxiety.
Staff well-being: Between £310 million and £930 million a year would be gained from improving staff well-being.
Minimum wage compliance: Between £42 million and £168 million a year would be gained through improving minimum wage compliance.
Strikes: Between £255 million and £510 million a year would be gained through resolving disputes that lead to workers taking action.
Industrial relations: Between £2.7bn and £8.1bn a year would be gained through reduced workplace conflict
Increased labour market participation: Between £1.3bn and £2.6bn a year would be gained through increasing employment for people currently looking after family or home.
The research shows that the cumulative impact of even modest improvements would be £13.3bn a year – and stronger outcomes could generate even greater gains.
The TUC says the analysis confirms the view of the government’s impact assessment that there is “clear, evidence-based benefits of government action through the Bill.”
The impact assessment also warns that “not acting would enable poor working conditions, insecure work, inequalities and broken industrial relations to persist.”
Evidence to MPs
The findings were published as TUC General Secretary Paul Nowak prepared to give evidence to MPs as the Employment Rights Bill enters its committee stage.
Nowak told parliamentarians that improving the quality of work in Britain is an “urgent national mission” that will benefit workers and businesses alike.
Polling published in July revealed huge backing across the political spectrum for boosting workers’ rights.
And polling published in September revealed that an overwhelming majority (75%) of employers support the government’s measures, including nearly seven in 10 (69 per cent) of small businesses.
TUC General Secretary Paul Nowak said: “Far too many working people are trapped in jobs that offer them little or no security. We can’t carry on with this broken status quo.
“Improving the quality of work in this country is an urgent national mission that will bring real economic gains.
“Driving up employment standards, improving employee well-being and increasing labour market participation is good for staff and good for businesses.
“When workers are treated well they are happier, healthier and more productive.
“The Employment Rights Bill is a historic opportunity to make work pay – and to create a level playing field that stops good employers from being undercut by the bad.
“It must be delivered in full.”
Commenting on the impact of the Bill on employers, Paul added: “The TUC stands ready to work with the government and employers. We recognise that businesses and unions will need advice to understand and implement these changes.
“But there is no case for delaying the reforms. People need jobs they can build a decent life on.
“Many of the arguments being used against this legislation are the same ones that were used against introducing the minimum wage – one of the great policy successes of the last 25 years.
“They were wrong then and they are wrong now. When working people thrive so do businesses and the wider economy.”
In the Budget, the Chancellor announced that Retail, Hospitality and Leisure (RHL) businesses would receive 40% rates relief in England next year, following a 75% relief in the current year (write Fraser of Allander Institute’s MAIRI SPOWAGE and JOAO SOUSA).
RHL businesses in Scotland have had no such relief since 2021-22, which (as you can imagine) has led to many businesses saying they are at a disadvantage to their counterparts South of the Border. Given this extension in relief in England, businesses in the RHL sector are likely to be calling on the Scottish Government to follow suit.
Such a decision by the Chancellor does generate Barnett consequentials for the Scottish Government, because the UK Government compensated English councils for the lost revenue. Business rates are devolved to all three devolved nations, and there is no obligation for any of the devolved governments to replicate measures in their jurisdiction.
Last year, we looked at the 75% relief announcement in England and tried to estimate how much it would cost to replicate. This analysis concluded that it was likely to cost considerably more in Scotland to replicate the relief than was provided through Barnett, because:
The business rates system is just differently structured in Scotland; but mainly;
RHL businesses make up a larger share of the property tax base in Scotland.
What about the 40% relief?
As we did last year, we have looked at the data available on the tax base for business rates to try to estimate how much it might cost to replicate the 40% relief in Scotland.
We must emphasise that this is not completely straightforward from the publicly available data. Whilst the Valuation Roll (which lists all properties and their rateable value) is a public document, the extent to which different properties attract reliefs is not on this database, so we have to make some assumptions about the extent to which properties may already be receiving reliefs. Obviously, for example, if a property is already receiving 100% relief (e.g. through the Small Business Bonus Scheme), then they cannot receive any more relief from the 40% measure, even if they are in RHL.
This is important because 100% relief for property is actually quite common: 48% of properties receive this.
Chart 1: Proportion of properties that receive 100% relief, selected property classes
Source: Scottish Government
The second challenge is that there is a cap on the amount of relief that an individual company can receive, which limits the amount of relief paid, but requires a property-by-property analysis (and some assumptions about multi-property companies) to understand the impact this has on the overall cost.
All of these assumptions mean our analysis will not be as accurate as a proper costing by the Scottish Fiscal Commission if the Scottish Government were to introduce this measure (given the additional data they have access to): and our attempt to account for multi-property enterprises is likely to be imperfect which might mean we are underestimating the impact of the cap (so slightly overestimating the cost of a new relief).
Having said all that (sorry for all the caveats), our analysis suggests that it will cost roughly £220m to replicate this relief in Scotland, compared to the £147m that was generated by the decision in England through Barnett.
[For those who are interested, you will note that this is not a linear reduction on our estimate for the 75% relief. This is because of the cap for each company again: companies are more likely to hit the cap with a higher level of relief so it is not as simple as it appears, unfortunately!]
Look out for more analysis
We will be producing Scotland’s Budget Report 2024 on 29 November, which will set the context for the Scottish Budget on 4 December. In the run-up, we will continue to publish blogs with new analysis to add to the discussion!
Chancellor takes radical action to drive economic growth
Biggest pension reforms in decades will merge Local Government Pension Scheme assets and consolidate defined contribution schemes into megafunds
Changes could unlock around £80 billion of investment for infrastructure projects and businesses of the future
Local Government Pension Scheme changes will free up money for local public services in the long-term and secure more than £20 billion for investment in local communities
Pension megafunds will be created as part of the biggest set of pension reforms in decades, unlocking billions of pounds of investment in exciting new businesses and infrastructure and local projects.
After her inaugural Budget that ‘fixed the foundations to deliver stability’, Rachel Reeves will use her first Mansion House speech as Chancellor to announce bold action to tackle the fragmented pensions landscape, deliver investment and drive economic growth – which is the only way to make people better off.
The radical reforms, which will be introduced through a new Pension Schemes Bill next year, will create megafunds through consolidating defined contribution schemes and pooling assets from the 86 separate Local Government Pension Scheme authorities.
These megafunds mirror set-ups in Australia and Canada, where pension funds take advantage of size to invest in assets that have higher growth potential, which could deliver around £80 billion of investment in exciting new businesses and critical infrastructure while boosting defined contribution savers’ pension pots.
Chancellor of the Exchequer, Rachel Reeves said: “Last month’s Budget fixed the foundations to restore economic stability and put our public services on a firmer footing. Now we’re going for growth.
“That starts with the biggest set of reforms to the pensions market in decades to unlock tens of billions of pounds of investment in business and infrastructure, boost people’s savings in retirement and drive economic growth so we can make every part of Britain better off.”
Deputy Prime Minister, Angela Rayner said:“We’ve all seen the fantastic work carried out day in, day out, by our frontline workers and it’s about time their pension started working just as hard by driving investment in their communities.
“This is about harnessing the untapped potential of the pensions belonging to millions of people, and using it as a force for good in boosting our economy.”
Pensions Minister, Emma Reynolds said: “Harnessing the power of this multi-billion-pound industry is a win-win, benefiting future pensioners, and our wider economy.
“These reforms could unlock £80 billion of investment into exciting new businesses and critical infrastructure.”
The UK pension system is one of the largest in the world – with the Local Government Pension Scheme and Defined Contribution market set to manage £1.3 trillion in assets by the end of the decade.
However, our pension landscape is fragmented and lacks the size needed to invest in exciting new businesses or expensive projects like infrastructure.
The government’s analysis – published today in the interim report of the Pensions Investment Review at Mansion House – shows that pension funds begin to return much greater productive investment levels once the size of assets they manage reaches between £25-50 billion.
At this point they are better placed to invest in a wider range of assets, such as exciting new businesses and expensive infrastructure projects. Even larger pensions funds of greater than £50 billion in assets can harness further benefits including the ability to invest directly in large scale projects such as infrastructure at lower cost.
This is supported by evidence from Canada and Australia. Canada’s pension schemes invest around four times more in infrastructure, while Australia pension schemes invest around three times more in infrastructure and 10 times more in private equity, such as businesses, compared to Defined Contribution schemes in the UK.
Benchmarking against domestic and international examples show how consolidation of the Local Government Pension Scheme and defined contribution schemes into megafunds could unlock around £80 billion of investment in productive investments like infrastructure and fast-growing companies.
The government is therefore consulting on proposals to take advantage of pension fund size and improve their governance.
Local Government Pension Scheme
The Local Government Pension Scheme in England and Wales will manage assets worth around £500 billion by 2030. These assets are currently split across 86 different administering authorities, managing assets between £300 million and £30 billion, with local government officials and councillors managing each fund.
Consolidating the assets into a handful of megafunds run by professional fund managers will allow them to invest more in assets like infrastructure, supporting economic growth and local investment on behalf of the 6.7 million public servants – most of whom are low-paid women – whose savings are managed.
These megafunds will need to meet rigorous standards to ensure they deliver for savers, such as needing to be authorised by the Financial Conduct Authority. Governance of the Local Government Pension Scheme will also be overhauled to deliver better value from investment decisions, which independent research suggests could free up money in the long-term to support local public services.
Local economies will be boosted by the changes as each Administering Authority will be required to specify a target for the pool’s investment in their local economy, working in partnership with Local and Mayoral Combined Authorities to identify the best opportunities to support local growth. If each Administering Authority were to set a 5% target, that would secure £20 billion of investment in local communities.
A new independent review process will be established to ensure each of the 86 Administering Authorities is fit for purpose.
Defined contribution schemes
Defined contribution pension schemes are set to manage £800 billion worth of assets by the end of the decade.
There are currently around 60 different multi-employer schemes, each investing savers’ money into one or more funds. The Government will consult on setting a minimum size requirement for these funds to ensure they deliver on their investment potential.
The government will also consult on measures to facilitate this consolidation into megafunds, including legislating to allow fund managers to more easily move savers from underperforming schemes to ones that deliver higher returns for them.
Westminster’sJustice and Home Affairs Committee today publishes a letter to the Minister for Policing, Crime and Fire Prevention, Dame Diana Johnson MP, after conducting an inquiry into shop theft.
The Justice and Home Affairs Committee conducted an inquiry into shop theft. The Committee finds that shop theft is an underreported crime that is not being effectively tackled, leading to a devastating impact on the retail sector and the wider economy.
The Committee heard that there are almost 17 million incidents of shop theft annually, with few leading to an arrest and costing the retail sector almost £2 billion last year.
The nature of the offence has evolved from individualised offending to relentless, large-scale, organised operations accompanied by unprecedented levels of violence. Shop theft is now seen as a lucrative profit-making opportunity which is being exploited by organised criminal networks.
There is a widespread perception that shop theft is not treated seriously by the police. The Committee recognises the need for quicker reporting systems, better data collection and intelligence sharing between police forces across the UK.
The Committee welcomes the work of Pegasus, the new national scheme to tackle organised crime in the retail sector and recommends that existing schemes such as Business Crime Reduction Partnerships (linking police and local businesses) should all be part of a National Standards Accreditation Scheme.
The Committee concludes:
The outdated term “shoplifting” serves to trivialise the severity of the offence and should be phased out.
The Committee supports the plan to repeal the offence of “low-value shoplifting” under section 176 of the Anti-Social Behaviour, Crime and Policing Act, which in practice is decriminalising shop theft where the value of the goods does not exceed £200.
The Committee supports the creation of a standalone offence of assaulting a retail worker.
Improved reporting systems are required to enable retailers to report crime to the police quickly and easily.
The Committee recommends improving mechanisms for police and criminal justice systems to recognise and record when a crime has taken place in a retail setting.
Increased funding to community-based reoffending and rehabilitation initiatives are crucial to help divert prolific drug and alcohol addicted offenders away from further offending.
Public awareness campaigns are needed to target the stolen goods market.
The Committee supports the introduction of regulations and best practice guidance for the use of facial recognition technology by private companies.
Lord Foster of Bath, Chair of the Justice and Home Affairs Committee said: “In March 2024, 443,9953 incidents of shop theft were recorded by police – a 30% increase on the previous year and the highest-ever level since comparable records began over twenty years ago.
“But the figures are “a drop in the ocean” when compared with likely real figures estimated at 17 million with devastating consequences for businesses and families.
“The scale of the shop theft problem within England and Wales is totally unacceptable and action, like that underway in the Pegasus scheme, is vital and urgent.
“There’s no silver bullet. But, if adopted, the recommendations in our report should help tackle the problem and help keep the public and our economy safer.”
Jobs and sectors dependent on sustainable natural world
Scotland’s natural assets contribute more than £40 billion to the economy and support around 260,000 jobs, according to new research.
The Importance of Natural Capital to the Scottish Economy report highlights the vital economic contribution the natural world makes to Scotland and highlights the value of the ecosystems and the services they provide.
Important industries such as agriculture, fishing and aquaculture, forestry, water, food and drink and renewables all rely upon the continued availability of high-quality natural resources.
The research investigates the economic impact of natural capital, which is defined as “the renewable and non-renewable stocks of natural assets, including geology, soil, air, water and plants and animals that combine to yield a flow of benefits to people.”
The Scottish Government conducted the research to provide the most up-to-date reflection of the true value of nature to the Scottish economy, as it is often undervalued or not included in economic assessments.
The study demonstrates the link between the threats to Scotland’s economic performance, and the economic opportunity associated with increasing nature dependent sectors.
The Scottish Government’s National Strategy for Economic Transformation (NSET) makes clear that working with and investing in nature is a top priority of Scotland’s wellbeing economy.
Speaking while visiting Blackthorn Salt in Ayrshire, which produces salt through filtering sea water, Rural Affairs Secretary Mairi Gougeon said: “This research reinforces the vital role of our natural capital in supporting many of our vital industries – a connection that is often under-represented when we look at economic performance.
“Blackthorn Salt is an excellent example of a business that is dependent on natural capital, using sustainable, traditional methods to produce an exceptional products that provides jobs and can be found in kitchens across the country and beyond.
“The twin crises of climate change and nature loss are inextricably linked, nature offers some of the best ways to protect us from the worst impacts of climate change, so it is essential that we work with partners across the public sector and private investors to protect biodiversity and reduce our emissions as we support sustainable businesses utilising our incredible landscapes and ecosystems.”
NatureScot Chief Executive, Francesca Osowska said: “Nature is vital for our quality of life and that of future generations. In Scotland we are fortunate to have rich and varied landscapes and habitats, with individuals and businesses willing to step up to the challenge of stopping nature loss with hard work and investment.
“NatureScot is responding to this urgent need with leadership of vital programmes such as the £250m Peatland ACTION fund, the £65m Nature Restoration Fund and the innovative new Facility for Investment Ready Nature Scotland (FIRNS) which aims to both restore nature and benefit communities. “
Chancellor ‘takes long-term decisions to restore stability, rebuild Britain and protect working people across Scotland’
No change to working people’s payslips as employee national insurance and VAT stay the same, but businesses and the wealthiest asked to pay their fair share.
Record £47.7 billion for the Scottish Government in 2025/26 includes £3.4 billion through the Barnett formula.
Funding for Green Freeports, City and Growth Deals, GB Energy and hydrogen projects to fire up growth and deliver good jobs across Scotland.
The Chancellor has ‘delivered a Budget to fix the foundations to deliver on the promise of change after a decade and a half of stagnation’. She set out plans to rebuild Britain, while ensuring working people across Scotland don’t face higher taxes in their payslips.
The UK Government was handed a challenging inheritance; £22 billion of unfunded in-year spending pressures, debt at its highest since the 1960s, an unrealistic forecast for departmental spending, and stagnating living standards.
This Budget takes ‘difficult decisions’ to restore economic and fiscal stability, so that the UK Government can invest in Scotland’s future and lay the foundations for economic growth across the UK as its number one mission.
The Chancellor announced that the Scottish Government will be provided with a £47.7 billion settlement in 2025/26 – the largest in real terms in the history of devolution. This includes a £3.4 billion top-up through the Barnett formula, with £2.8 billion for day-to-day spending and £610 million for capital investment.
Secretary of State for Scotland Ian Murray said: “This is a historic budget for Scotland that chooses investment over decline and delivers on the promise that there would be no return to austerity.
“It is the largest budget settlement for the Scottish Government in the history of devolution, including an additional £1.5 billion this financial year and an additional £3.4 billion next year through the Barnett formula. That money must reach frontline services, to bring down NHS waiting lists and lift attainment in our schools.
“It will also bring a new era of growth for Scotland and the whole UK, confirming nearly £890 million of direct investment into Freeports, Investment Zones, the Argyll and Bute Growth Deal, and other important local projects across Scotland’s communities, as well as £125 million next year for GB Energy and support for green hydrogen projects in Cromarty and Whitelee.
“The increase in the minimum wage will also mean a pay rise for hundreds of thousands of workers in Scotland, with the biggest increase for young workers ever. This is on top of our employment rights bill which will deliver the biggest upgrade in workers’ rights in a generation. The triple lock means an increase in the state pension by £470 next year, on top of £900 this year for a million Scottish pensioners.
“The budget protects working people in Scotland, delivers more money than ever before for Scottish public services and means an end to the era of austerity.”
Protecting working people and living standards
While fixing the inheritance requires tough decisions, the Chancellor has committed to protecting the living standards of working people. The decisions taken by the Chancellor to rebuild public finances enable the UK Government to deliver on its pledge to not increase National Insurance or VAT on working people in Scotland, meaning they will not see higher taxes in their payslip.
The National Living Wage will increase from £11.44 to £12.21 an hour from April 2025. The 6.7% increase – worth £1,400 a year for a full-time worker – is a significant move towards delivering a genuine living wage.
The National Minimum Wage for 18 to 20-year-olds will also see a record rise from £8.60 to £10 an hour.
Working people will benefit from these increases, with there estimated to be over 100,000 minimum wage workers in Scotland in 2023.
The Chancellor has made the decision to protect working people in Scotland from being dragged into higher tax brackets by confirming that the freeze on National Insurance Contributions thresholds will be lifted from 2028-29 onwards, rising in line with inflation so they can keep more of their hard-earned wages.
The Chancellor is also protecting motorists by freezing fuel duty for one year – a tax cut worth £3 billion, with the temporary 5p cut extended to 22 March 2026. This will benefit an estimated 3.2 million people in Scotland, saving the average car driver £59, vans £126 and Heavy Goods Vehicles £1,079 next year.
To support Scottish pubs and smaller brewers in Scotland, the UK Government is cutting duty on qualifying draught products by 1p, which represent approximately 3 in 5 alcoholic drinks sold in pubs. This measure reduces duty bills by over £70 million a year, cutting duty on an average strength pint in a pub by a penny. The relief available to small producers will be updated to help smaller brewers and cidermakers.
Over 1 million Scottish pensioners will benefit from a 4.1% increase to their new or basic State Pension in April 2025. This is an additional £470 a year for those on the new State Pension and an additional £360 a year for those on the basic State Pension.
Households eligible for Pension Credit will get £465 a year more for single pensioners and up to £710 a year more for couples due to a 4.1% increase in the Pension Credit Standard Minimum Guarantee, benefitting 125,000 pensioners in Scotland.
Around 1.7 million families in Scotland will see their working-age benefits uprated in line with inflation – a £150 gain on average in 2025-26.
Reducing the maximum level of debt repayments that can be deducted from a household’s Universal Credit payment each month from 25% to 15% will benefit a Scottish family by over £420 a year on average.
Rebuilding Britain
This UK Government will not make a return to austerity and will instead boost investment to rebuild Britain and lay the foundations for growth in Scotland. This includes £130 million of targeted funding for the Scottish Government, of which £120 million is in capital investment.
The Budget delivers on the first step to establish Great British Energy by providing £125 million next year to set up the institution at its new home in Aberdeen – helping to develop new clean energy projects in Scotland and across the UK.
The UK Government will deliver £122 million for City and Growth Deals, including the continuation of its contribution to the Argyll and Bute Growth Deal which delivers £25 million of investment in the region over 10 years. This Deal will be supported by a rigorous value for money assessment as part of the review of the business cases for projects within it, to ensure best value is being delivered.
The Budget gives certainty to local leaders and investors, confirming funding for the Investment Zones and Freeports programmes across the UK – including Scotland’s Green Freeports.
The Chancellor committed the UK Government to working closely with the Scottish Government on the Industrial Strategy, 10-year infrastructure strategy and the National Wealth Fund – to ensure the benefits of these are felt UK-wide and as part of the relationship reset between governments. These will mobilise billions of pounds of investment in the UK’s world-leading clean energy and growth industries.
To support economic growth and promote Scottish culture, products and services through diplomatic and trade networks, the UK Government is allocating £750,000 for the Scotland Office in 2025/26 to champion Brand Scotland as was committed in the manifesto.
We are supporting Scotland’s world-renowned Scotch Whisky industry by providing up to £5 million for HMRC to reduce the fees charged by the Spirit Drinks Verification Scheme and by ending mandatory duty stamps for spirits on 1 May 2025.
Two electrolytic hydrogen projects in Scotland have been selected for UK Government revenue support through the first Hydrogen Allocation Round: Cromarty Green Hydrogen Project and Whitelee Green Hydrogen. Both projects will bring in significant international investment and create good quality, local jobs.
An extension of the Innovation Accelerators programme will support the high-potential innovation cluster in the Glasgow City Region.
A corporate tax roadmap will provide businesses with the stability and certainty they need to make long-term investment decisions and support our growth mission. It confirms our competitive offer, with the lowest Corporate Tax rate in the G7 and generous support for investment and innovation.
The UK Government will also proceed with implementing the 45%/40% rates of the theatre, orchestra, museum and galleries tax relief from 1 April 2025 to provide certainty to businesses in Scotland’s thriving cultural sector.
Repairing public finances
The Chancellor has made clear that, whilst protecting working people with measures to reduce the cost of living, there would be difficult decisions required. The Budget will ask businesses and the wealthiest to pay their fair share while making taxes fairer. This will go directly towards fixing the foundations of the UK economy.
The rate of Employers’ National Insurance will increase by 1.2 percentage points, to 15%. The Secondary Threshold – the level at which employers start paying national insurance on each employee’s salary – will reduce from £9,100 per year to £5,000 per year.
The smallest businesses will be protected as the Employment Allowance will increase to £10,500 from £5,000, allowing Scottish firms to employ four National Living Wage workers full time without paying employer national insurance on their wages.
Capital Gains Tax will increase from 10% to 18% for those paying the lower rate, and 20% to 24% for those paying the higher rate.
To encourage entrepreneurs to invest in their businesses Business Asset Disposal Relief (BADR) will remain at 10% this year, before rising to 14% on 6 April 2025 and 18% from 6 April 2026-27.
The lifetime limit of BADR will be maintained at £1 million. The lifetime limit of Investors’ Relief will be reduced from £10 million to £1 million.
The OBR say changes to CGT raise over £2.5 billion a year and the UK will continue to have the lowest CGT rate of any European G7 country.
Inheritance Tax thresholds will be fixed at their current levels for a further two years until April 2030. More than 90% of estates each year will be outside of its scope. From April 2027 inherited pensions will be subject to Inheritance Tax. This removes a distortion which has led to pensions being used as a tax planning vehicle to transfer wealth rather than their original purpose to fund retirement.
From April 2026, agricultural property relief and business property relief will be reformed. The highest rate of relief will continue at 100% for the first £1 million of combined business and agricultural assets, fully protecting the majority of businesses and farms. It will reduce to 50% after the first £1 million. Reforms will affect the wealthiest 2,000 estates each year. Inheritance Tax reforms in total are predicted by the OBR to raise £2 billion to support stability.
From 2026-27 Air Passenger Duty (APD) for short and long-haul flights will increase by 13% to the nearest pound, a partial adjustment to account for previous high inflation. For economy passengers, this means a maximum £2 extra per short haul flight and tickets for children under the age of 16 remain exempt from APD. APD for larger private jets will be increased by a further 50%. Passengers carried on flights leaving from airports in the Scottish Highlands and Islands region are exempt from APD.
The rate of the Energy Profits Levy will increase to 38% from 1 November 2024 and the levy will now expire one year later than planned, on 31 March 2030. The 29% investment allowance will be removed.
To provide long-term certainty and to support a stable energy transition, the UK Government will make no additional changes to tax relief available within the EPL and a consultation will be published in early 2025 on a successor regime that can respond to price shocks. Money raised from changes to the EPL will support the transition to clean energy, enhance energy security and provide sustainable jobs for the future.
The Budget also announced a package of measures that disincentivise activities that cause ill health, by:
Renewing the tobacco duty escalator which increases all tobacco duty rates by RPI+2% plus an above escalator increase to hand rolling tobacco (totalling RPI+12%).
Introducing a new vaping duty at a flat rate of 22p/ml from October 2026, accompanied by a further one-off increase in tobacco duty to maintain financial incentive to choose vaping over smoking.
To help tackle obesity and other harms caused by high sugar intake, the Soft Drinks Industry Levy will increase to account for inflation since it was last updated in 2018, and the duty will rise in line with inflation every year going forward.
The UK Government will also uprate alcohol duty in line with RPI on 1 February 2025, except for most drinks in pubs.
The UK Government has set out the next steps to deliver its tax manifesto commitments in the July Statement. Having consulted on the final policy details where appropriate, this Budget delivers the UK Government’s manifesto commitments to raise revenue to pay for First Steps, with reforms that are underpinned by fairness, and tackle tax avoidance by:
A new residence-based regime will replace the current non-dom regime from April 2025 and will be designed to attract investment and talent to the UK.
Offshore trusts will no longer be able to be used to shelter assets from Inheritance Tax, and there will be transitional arrangement in place for people who have made plans based on current rules.
The planned 50% reduction for foreign income in the first year of the new regime will be removed.
Reforms to the non-dom regime will raise a total of £12.7 billion according to the OBR.
The tax treatment of carried interest will be reformed by first increasing the Capital Gains Tax rates on carried interest to 32% and then, from April 2026, moving to a revised regime – with bespoke rules to reflect the characteristics of the reward.
The Chancellor also ‘doubled down’ on fiscal responsibility through two new fiscal rules that put the public finances on a sustainable path and prioritise investment to support long-term growth, and new principles of stability. Spending Reviews will be held every two years, setting plans for at least three years to ensure public services are always planned and improve value for money.
One major fiscal event per year will give families and businesses stability and certainty on tax and spending changes, while giving the Scottish Government greater clarity for in its own budget-setting. A Fiscal Lock will also ensure no future government can sideline the OBR again.
Budget marks ‘step in right direction’
Scotland’s Finance Secretary responds to Budget
Finance Secretary Shona Robison has welcomed additional funding in the Autumn Budget, but said the Scottish Government will still face “enormous cost pressures” despite the measures.
The Finance Secretary said: “We called for increased investment in public services, infrastructure and tackling poverty. This budget is a step in the right direction, but still leaves us facing enormous cost pressures going forwards. The additional funding for this financial year has already been factored into our spending plans.
“By changing her fiscal rules and increasing investment in infrastructure, the Chancellor has met a core ask of the Scottish Government. But after 14 years of austerity, it’s going to take more than one year to rebuild and recover – we will need to see continued investment over the coming years to reset and reform public services.
“Indeed, there is a risk that by providing more funding for public services while increasing employer national insurance contributions, the UK Government is giving with one hand while taking away with the other.
“We estimate that the employer national insurance change could add up to £500 million in costs for the public sector unless it is fully reimbursed – and there is a danger that we won’t get that certainty until after the Scottish budget process for 2025/26 has concluded.
“With the lingering effects of the cost of living crisis still hitting family finances, it is disappointing that there was no mention of abolishing the two-child limit, which evidence shows would be one of the most cost-effective ways to reduce child poverty. Neither was there mention of funding for the Winter Fuel Payment.
“As ever, the devil is in the detail, and we will now take the time to assess the full implications of today’s statement. I will be announcing further details as part of the Scottish Budget on 4 December.”
Child Poverty Action Group: Chancellor misses golden chance to scrap two child limit
16 000 more children will now be pulled into poverty by time new UK child poverty taskforce reports in spring
“Good news on universal credit deductions, but no bold action on child poverty”
Barnett consequentials must now be prioritised to fund action on child poverty in Scotland
Responding to the UK Chancellor’s Budget, John Dickie, Director of the Child Poverty Action Group (CPAG) in Scotland, said;“The Chancellor brought good news on universal credit deductions, but this was not a Budget of bold action on child poverty. She missed a golden chance to scrap the two-child limit, a policy that will pull 16,000 extra children into poverty by the time the government’s child poverty taskforce reports in spring.
We welcome the new UK government’s ambition on child poverty but this budget played for time, time that children and families can’t afford. The UK spending review next spring will have to deliver much more to make a significant difference for children in poverty.”
Mr Dickie continued: “Here in Scotland and looking ahead to the Scottish budget it is vital that wider Barnett consequentials are now used to fund the action needed to deliver on the First Minister’s number one priority of ending child poverty.
“That must include funding a real terms increase to the Scottish child payment, expanding childcare provision, delivering on free school meal promises and increasing the supply of affordable family housing.”
POVERTY ALLIANCE:
Responding to today’s UK Budget, Poverty Alliance chief executive Peter Kelly said: “People across the UK believe in a nation based on justice and compassion. Today’s Budget was an opportunity for the Chancellor to turn those values into action, and to rebuild trust in government. Despite some welcome changes, there is still some way to go.
“Boosting the minimum wage is welcome, because for decades workers have been getting less and less from our growing economy. This increase will go some way to making up the gap, particularly for younger workers. But we need to remember that today’s Budget will still leave the legal minimum wages far lower than the real Living Wage rate – the only wage rate that is solely based on the cost of living – of £12.60 per hour, or £13.85 per hour in London.
“We know that too many people on Universal Credit find themselves pushed into destitution when they are chased for debt by public bodies, so it’s good that the maximum amount of benefit that can be taken from them has been reduced. But the Chancellor could have gone further, by strengthening our social security with a boost to Universal Credit that would guarantee that households can afford life’s essentials.
“She could have made it clear that every child matters, by scrapping the unjust and ineffective two-child limit, and ditching the unfair benefit cap which stops households getting all the support they are entitled to.
“There was a welcome focus on the importance of our public services to our shared prosperity and wellbeing. But the Chancellor could have done more to use our country’s wealth to tackle poverty and invest in a better society. Even with today’s changes, people who earn money from selling shares and business assets will pay Capital Gains Tax at a lower rate than workers pay in Income Tax. That’s just wrong.
“Freezing fuel duty and keeping the previous cuts in place will cost the Exchequer billions of pounds a year. It’s bad value for money, benefits the wealthiest in society most, and does little to make the transition to the green economy. The money would have been better invested in affordable, accessible, and sustainable public transport for all.
“It’s right that big companies pay their fair share towards building a strong society, but the Chancellor must urgently consider how increases to employer National Insurance will hit charities and community groups.
“The support and advice provided by these organisations is vital for people who have been pushed into poverty, but too many are already struggling through a lack of fair funding, and this NI increase could push many over the edge.
“That would be a disaster for our communities, and leave more low-income households facing destitution and despair.”
TUC: Labour’s investment budget has begun process of “repairing and rebuilding Britain”
Union body says budget is a vital first step towards the growth, jobs and living standards working people desperately need
Commenting on Wednesday’s budget statement from the Chancellor Rachel Reeves, TUC General Secretary Paul Nowak said: “The Chancellor was dealt a terrible hand by the last Conservative government – a toxic legacy of economic chaos, falling living standards and broken public services.
“But with today’s budget the Chancellor has acted decisively to deliver an economy that works for working people.
“The government’s investment plans are a vital first step towards repairing and rebuilding Britain – securing the stronger growth, higher wages and decent public services that the country desperately needs.
“Tax rises will ensure much-needed funds for our NHS, schools and the rest of our crumbling public services, with those who have the broadest shoulders paying a fairer share. The Chancellor was right to prioritise hospitals and classrooms over private jets.
“There is still a lot more work to do to clean up 14 years of Tory mess and economic decline. – including better supporting and strengthening our social security system. But this budget sets us on an urgently needed path towards national renewal.”
Shelter Scotland has responded to the UK budget set out this afternoon by Chancellor Rachel Reeves.
The housing and homelessness charity urged the Scottish Government to commit to investing any new capital funding into delivering the social homes needed to end the housing emergency.
However, it also expressed disappointment at the continuation of the two-child limit and ongoing freeze to Local Housing Allowance.
Shelter Scotland Director, Alison Watson, said:“Having declared a housing emergency it’s clear that the Scottish Government must back words with actions.
“It is vital that any capital funding which becomes available as a result of the Chancellor’s investment plans is in turn used by Scottish Ministers to deliver social homes here, but we also need to see growth in the capital budget over a sustained period to support continued investment.
“Delivering more social homes remains the single most effective way to tackle the housing emergency in Scotland, and only the Scottish Government can decide how much of its budget it commits to that endeavour.
“However, we can’t ignore the role that austerity has played in exacerbating Scotland’s housing emergency.
“The freeze on local housing allowance and the two-child limit has forced thousands into poverty; they will continue to do so as it seems the Chancellor has chosen to keep them in place.”
COSLA:
ONE PARENT FAMILIES SCOTLAND:
Scotch Whisky industry says UK government has broken commitment to ‘back Scotch producers to the hilt’
Chancellor increases discrimination of Scotch Whisky and other spirits in on-trade
The Scotch Whisky Association (SWA) says the Chancellor’s decision to further increase duty on Scotch Whisky has broken the Prime Minister’s commitment to ‘back Scotch producers to the hilt.’
In her first Budget, Chancellor Rachel Reeves announced an RPI inflation increase to alcohol duty, but cut duty on draught products in the on-trade by 1.7%. Scotch Whisky and other spirits are excluded from this tax relief.
The SWA had called on the new Chancellor to take the opportunity to reverse the damage done by the 10.1% increase in August 2023. Instead, the damage done to the industry and to government revenue has been compounded by further increasing the tax burden on the sector, which is already the highest in the G7.
Spirits revenue fell by hundreds of millions of pounds as a result of the 10.1% duty increase last year, and the industry has warned that this further tax hike will not deliver the revenue ministers have been promised but will hurt businesses, the hospitality sector and hard-pressed consumers.
Commenting on the Budget, Chief Executive of the SWA Mark Kent said:“This duty increase on Scotch Whisky is a hammer blow, runs counter to the Prime Minister’s commitment to ‘back Scotch producers to the hilt’ and increases the tax discrimination of Scotland’s national drink.
“On the back of the 10.1% duty increase last year, which led to a reduction in revenue for HM Treasury, this tax hike serves no economic purpose. It will damage the Scotch Whisky industry, the Scottish economy, and undermines Labour’s commitment to promote ‘Brand Scotland’.
“She has also increased the tax discrimination of spirits in the Treasury’s warped duty system, and with 70% of UK spirits produced in Scotland, that will do further damage to a key Scottish sector.
“The disastrous 10.1% duty hike last year has now been compounded. This further tax rise means the lessons have not been learned, and the Chancellor has chosen continuity with her predecessor, not change.
“We urge all MPs who support Scotch Whisky to vote against this duty hike and tax discrimination of Scotland’s national drink.”
Rain Newton-Smith, CBI Chief Executive, said:“The Chancellor had difficult choices to make to deliver stability for the economy and public finances. A more balanced approach to our fiscal rules which prioritises capital investment should help to unlock private sector investment in our infrastructure and net zero transition over the long-term.
“This is a tough Budget for business. While the Corporation Tax Roadmap will help create much needed stability, the hike in National Insurance Contributions alongside other increases to the employer cost base will increase the burden on business and hit the ability to invest and ultimately make it more expensive to hire people or give pay rises.
“Only the private sector can provide the scale of investment required to deliver the government’s growth agenda.
“To achieve this shared mission of growing our economy sustainably, it’s vital that the government doubles down on its partnership with business to unlock the investment that is needed to drive opportunity around the UK.”
FSB: Employment allowance rise welcome from Chancellor in tax-raising Budget
The Federation of Small Businesses responds to the Chancellor’s Budget statement
Responding to the Chancellor’s Budget statement, Policy Chair of the Federation of Small Businesses (FSB), Tina McKenzie, said: “Increasing the employment allowance for small businesses by a record amount is a very welcome move and we’re pleased the Chancellor has heard us loud and clear.
“More than doubling it, from £5,000 to £10,500, will shield the smallest employers from the jobs tax, therefore is a pro-jobs prioritisation in a tough Budget.
“The decision to protect small businesses from an inflationary hike in business rates – by freezing the small business multiplier – will help small firms with premises across all sectors. Meanwhile, extending business rates relief, albeit at a lower level, for small firms in retail, hospitality and leisure will mitigate a potential cliff-edge tax hike for those in some of the toughest sectors.
“The true test of today’s Budget will be whether small businesses can grow and end the economic stagnation the UK has been stuck in.
“Larger small, and medium-sized, businesses will struggle with the rises on employer national insurance on top of the large costs from the Government’s employment law plans. We’ve been very clear in our warning of the difficulty SMEs will be confronted with in meeting all of these changes at once – and the potential impact on jobs, wages and prices.
“The Budget documents include plans for a small business strategy command paper, which is a welcome signal that ministers appreciate the central role that small businesses play in driving growth and we look forward to working with the Government closely on that.
“Investment in infrastructure is key to future growth, and the Chancellor’s announcement of additional funding for rail projects and fixing potholes is therefore encouraging. Many small firms, meanwhile, will be relieved at the decision not to raise fuel duty. The commitment to prioritise small housebuilders when it comes to housing investment is also welcome.
“Building a business involves a significant element of risk and personal, as well as financial, investment. But for the economy to grow, we need more people to be incentivised to take that leap and, in turn, create jobs, opportunities and prosperity in all communities across the country.
“The right decision has been taken to retain entrepreneurs’ relief (now branded Business Asset Disposal Relief) up to £1million, which is something we have campaigned hard for. Although the level of relief will gradually reduce over time, resulting in more tax being paid in the future on business sales, we’re pleased to see a differential has been kept.
“Against a challenging backdrop, today’s Budget shows a clear direction in business policy now for the whole of this Parliament to target support at small businesses, rather than big corporates – prioritising everyday entrepreneurs working in local communities in all parts of the country.”
UK Budget fails “3 Key Tests for Scotland”, say Alba Party
Scottish Government must now fund universal entitlement to pensioners winter fuel payment
“To gain pass marks the new UK Labour Government had three key tests to meet in Scotland: it had to reverse its plan to cut the universal winter fuel payment; it had to save Grangemouth; and it had to fund a plan to save North Sea Oil and Gas jobs – on all three counts Labour has failed Scotland.”
This was said today by Acting Alba Party leader Kenny MacAskill reacting to Chancellor Rachel Reeves’ budget.
Alba Party say that the UK Government had three key tests to meet to deliver for Scotland. Former First Minister Alex Salmond helped launch a campaign to save the winter fuel payment last month.
Close to one million pensioners in Scotland are set to lose out on between £200-£300 this winter. Acting Alba Party leader Kenny MacAskill has been a leading voice in the campaign to save the Grangemouth Oil Refinery from closure.
Mr MacAskill has today hit out at the UK Government after Labour promised in the General Election to save Scotland’s only refinery that is set for closure next year but has failed to provide funding to save the refinery in today’s budget.
MacAskill has now called on the Scottish Government to use extra Barnett consequential funding to fully mitigate the cut to the winter fuel payment.
Alba Party have also hit out as successive UK Government’s have promised investment in Carbon Capture Technology in the North East of Scotland. Alba say the technology is vital to secure the future of the North Sea Oil and Gas industry and to help Scotland play its part in protecting the environment. Today’s UK Budget confirmed £22billion of investment in carbon capture projects in England – but snubbed the Acorn project on the Buchan coast.
Commenting Acting Alba Party leader Kenny MacAskill said: ““Today’s UK Budget is a continuity budget that proves that regardless of whether we have a UK Tory Government or a UK Labour Government, Scotland will always lose.
“To gain pass marks the new UK Labour Government had three key tests to meet in Scotland: it had to reverse its plan to cut the universal winter fuel payment; it had to save Grangemouth; and it had to fund a plan to save North Sea Oil and Gas jobs – on all three counts Labour has failed Scotland.
“ Close to a million Scottish pensioners are to be kept in the cold this winter, the UK Government has chosen to stand by and allow Scotland’s key industrial asset to close, and Labour have betrayed the North East of Scotland.
“ Nothing for Scotland’s pensioners, nothing for Grangemouth and nothing for Carbon Capture and the North Sea. It is now vital that the Scottish Government steps up to the plate and uses any additional funding consequentials it receives to fully mitigate the cut to the winter fuel payment.”
Budget is a ‘Missed Opportunity’
The budget is a missed opportunity to bring about the transformative change this country needs, said Westminster’s group of independent MPs.
A statement from the Independent Alliance:
LOCAL GOVERNMENT INFORMATION UNIT:
Dr Jonathan Carr-West, Chief Executive, LGIU, said: “The Chancellor billed this as an historically consequential budget of hard choices. That’s certainly true in many areas with £40bn of tax rises announced and significant changes to the government’s debt rules.
“For local government, however, it is a budget of choices deferred. It could have been worse – there’s an additional £1.3bn in funding including money for social care and additional funding for housing and special educational needs: the very areas that are driving many councils to bankruptcy.
“But this extra funding is not even half the gap that councils currently face.
“The longer-tem change that the sector desperately needs is all deferred for now. We are waiting on the Local Government Finance Settlement, on the Devolution White Paper and on a broader redistribution of funding through a multi-year settlement from 2026-27.
“There were some welcome highlights: retaining 100% of right to buy receipts and integrated settlements for Greater Manchester and the West Midlands and possibly for other places in future.
“Is this a start? Yes. Is it enough? Not by a long shot. At least not yet. There’s a positive direction of travel set out, but there’s a long way to go and the pressure on council finances means there’s a real risk that some councils will not be able to hang on long enough to get there.”
