Tag: finance

Scotland’s revenues grow by £3 billion

DEFECIT CONTINUES TO FALL 

Scotland’s notional deficit is falling faster than the UK’s, with onshore revenues increasing by 5.1% to reach £61.3 billion in 2018-19 as a result of continued economic growth.

According to the Government Expenditure and Revenue Scotland (GERS) figures published yesterday, Scotland benefitted from a £3 billion increase in onshore revenues in the last year – the fastest growth since 2010-11 as the overall notional deficit fell by £1.1 billion to 7.0% of GDP, down from 8%, in 2018-19.

The reduction in the notional deficit is the result of revenues growing at a faster rate than expenditure.

Commenting on the latest figures during a visit to manufacturing company Armadilla Ltd in Bonnyrigg, Finance Secretary Derek Mackay said: “With record tax revenues, strong economic growth and near record low unemployment, Scotland’s economy and public finances are strong. Today’s figures show overall revenue in Scotland reached £62.7 billion – exceeding £60 billion for the first time – reflecting the strength of our economy.

“Our notional deficit has fallen while public spending has increased thanks to our efforts to grow the onshore economy and the strong performance of taxes in Scotland. The Scottish Government’s choices on taxation are helping to create a more progressive tax system.

“This strong performance from Scotland’s economy is at risk as a result of the UK Government’s EU exit plans, and in particular a ‘no deal’ Brexit, which poses a severe threat to jobs, investment and living standards

“A ‘no deal’ Brexit could reduce revenues in Scotland by around £2.5 billion a year, holding Scotland back and demonstrating why people in Scotland increasingly recognise the importance of making our own decisions.

“These figures reflect Scotland’s position as part of the UK. The Scottish Government believes we could unlock our full potential with independence, allowing us to take the best decisions for Scotland.

“As we have always said, Scotland has a strong, and growing, economy and our future will be far brighter as an independent member of the EU.”

Westminster puts a different slant on the latest figures, of course. Commenting on the Scottish Government’s GERS figures for 2018-19, Scottish Secretary Alister Jack said: “Today’s GERS figures show clearly how Scotland benefits from being part of a strong UK with every man, woman and child in Scotland receiving a ‘Union dividend’ of nearly £2,000 a year.

“These Scottish Government figures also show there would be a £12.6 billion black hole at the centre of an independent Scotland’s finances. Real questions need to be asked about the First Minister’s stewardship of the country’s economy.

“With Scotland’s deficit now more than six times greater than the UK average, the Scottish Government needs to take action.

“Scotland remains the highest taxed part of the UK. This is harming our economy and should be a huge concern to us all.

“The UK Government is investing in Scotland to deliver jobs, opportunities and sustainable growth, including £1.4 billion for city and growth deals. We are working hard to support businesses and bring further opportunities as we leave the EU on 31 October.”

The UK Government notes:

  1. Using the Scottish Government’s own data, public spending in Scotland was nearly £1,661 per head higher than that of the UK average. In other words, in 2018-19 it was 13.6% higher than the UK average. Over the last five years, this gap has been on an upward trend from £1,182 or 10.2% in 2014-15 and £1,661 or 13.6% in the latest full financial year.
  2. Scotland’s tax contributions, at £11,531, continue to be around £307 per head less than the UK average, at £11,838.
  3. Scotland’s deficit [or borrowing] was nearly £1,968 per person larger than the UK average in 2018-19.
  4. Scotland contributed 8.0% of UK tax and received 9.3% of UK spending in 2018-19 (Scotland’s population share was 8.2% in 2018-19), demonstrating how Scotland receives secure and stable levels of spending irrespective of the volatile tax revenues from the North Sea.
  5. Whilst Scotland’s share of UK total revenue has marginally increased over the last year, it is generally on a downward trend. Since its peak at 9.7% in 2008-09, Scotland’s contribution to UK revenues has been on a downward trend in subsequent years and is currently at 8.0% of the UK total. This is marginally up from 7.9% the year before.
  6. Total North Sea revenues fell slightly from £1.30 billion in 2017-18 to £1.24 billion in 2018/19. This is up from a low of minus £85 million in 2015-16 and down from a peak in 2008-09 of £10.6 billion.
  7. Scotland’s net fiscal balance as a share of GDP was –7.0%, compared to –1.1% for the UK overall. This decreased from –8.1% in 2017-18, compared to the UK overall, which came down from –2.0%. In absolute terms, Scotland’s deficit was £12.6 billion in 2018-19, down from £13.8 billion in 2017-18 (incl. North Sea revenues).
  8. While Scotland’s overall fiscal position improved in 2018-19, Scotland’s deficit as a share of its economy is over 6 times higher than that of the UK.

You pays your money, you takes your choice. Make your own mind up:

The full statistical publication is available at http://www.gov.scot/gers

 

Money Talk Team benefits thousands of families

Free advice service helps low income households save more than £6 million.

Low-income families who seek free financial advice from the Money Talk Team are on average now £1,850 better off.

The service offers one-stop, personalised advice on dealing with debt and ways to reduce household bills.

With around 450,000 cases of unclaimed benefits in Scotland, it also helps low-income families identify what financial support might be available. The service is supported by Scottish Government funding of £3.3 million over two years.

In the last nine months, the Money Talk Team has helped a total of 3,198 people be better off by more than £6 million – meaning households benefit by more than £1,850 on average. A total of nearly 8,000 people have accessed the service.

Launching a national advertising campaign to raise awareness of the Money Talk Team, Communities Secretary Aileen Campbell said: “The Money Talk Team is making a huge difference to the thousands of families that have already taken advantage of this free service.

“The friendly, experienced advisers talk callers through the options available, letting them know exactly what they are entitled to and helping them save money.

“But there are still too many families out there not getting what they should be.

“If you’re a parent struggling to pay the bills at the end of the month, you’re not alone. It doesn’t matter if you’re in or out of work, one call to the free phoneline is all it takes to get some advice that could be a massive help to your household.”

Money Talk Team is the new name for Financial Health Check, which started in 2018 and is delivered by Citizens Advice Scotland. It can be accessed through their free helpline on 0800 085 7145 or by visiting a local Citizens Advice Bureau.

Bad news for Scottish drivers as car insurance prices accelerate

– The average price of car insurance in Scotland increased by £32 (5%) in 12 months with motorists now paying £646, on average –

  • Central Scotland sees the steepest increase, with car insurance costs climbing by £43 (7%) year-on-year.
  • Car insurance prices in the Scottish regions see the steepest increase in more than 12 months.
  • Scottish drivers are as little as £34 away from paying the most expensive car insurance prices on record for their region.
  • Further research finds two in five (43%) drivers saw their renewal price increase by £42, on average, as one in four (26%) are confused about why the cost of their car insurance is increasing.
  • Confused.com urges drivers to shop around as the average price of car insurance in the UK increased £37 (5%) year-on-year to £789.

 

It’s bad news for drivers in Scotland as the cost of car insurance in the region increased by more than £30 in 12 months. Continue reading Bad news for Scottish drivers as car insurance prices accelerate

Holyrood committee asks: can business finance support be improved?

Holyrood’s Economy, Energy and Fair Work Committee is looking for a wide range of views from businesses that have received ‘Regional Selective Assistance’ (RSA) or other financial support from Scottish Enterprise or Highlands and Islands Enterprise over the past ten years.

RSA is Scotland’s main national scheme of financial assistance to industry and has existed since 1970. It is managed and delivered by Scottish Enterprise and offers discretionary grants with the aim of creating and safeguarding jobs.

The Committee is also looking to hear from businesses who have been unsuccessful in their application to RSA or have received financial assistance from another body.

Committee Convener, Gordon Lindhurst MSP (above) said: “Over the last ten years over 960 projects have received £337 million of RSA investment. This has represented a significant attempt to address regional disparities across Scotland.

“The Committee wants to gain an understanding of impact these grants have had and whether grant support could be improved, and I urge businesses who have engaged with this scheme to tell us about their experiences.”

The outcome from this exercise is expected to feed into the upcoming Scottish Government budget plans and policy development.

The key areas that the Committee hopes to find answers to are:

  • Does RSA, and other grants, represent good value for money?
  • Could the £18 million to £34 million spent each year on RSA be better used supporting Scotland’s businesses in other ways?
  • To what extent does Regional Selective Assistance support the Scottish Government’s economic goals, as set out in its Economic Strategy and National Performance Framework?
  • How do RSA, and other grants, contribute to “inclusive economic growth”?
  • How do the enterprise agencies measure the impact of RSA? Views on how RSA and other financial support packages are evaluated by Scottish Enterprise and Highlands and Islands Enterprise.
  • How well do RSA and other grants interact with other SE and HIE interventions?
  • Views on the eligibility criteria, application and approval process;
  • Should RSA change, and if so, how?
  • What due diligence and accountability processes are followed by the enterprise agencies?
  • What progress has been made towards introducing more conditionality? Whether more conditionality should be applied to RSA funding in addition to that announced over the past year.
  • How successful is the claw-back process when investments fail?

Businesses are encouraged to complete a short questionnaire which aims to capture the experiences and views of successful, and unsuccessful, recipients of RSA and other grants. The questionnaire can be found here

Alternatively, you can respond to the call for views which can be found here

The deadline for submitting views is Friday 16th August 2019.

Letters: Brainwashed Britain?

Dear Editor

The banking organisations, through incompetence, nearly made the country bankrupt but the debt was passed on to the people to shoulder. They had to accept a lot of unemployment, higher prices in the shops, frozen wages and severe cuts to public and social services.

To avoid any resistance, the authorities launched a campaign of diversion and blame. Everyone can remember how different sections of society were blamed in turn: the unemployed for not working, the disabled for being on benefits – all were targets to be blamed.

This went on for many years and people had taken enough of austerity; there was a growing mood for change, calling for the authorities to take the banking industry into public ownership and impose tighter controls over financial institutions.

This fast-growing popular demand was greatly feared by the political elite. It took them quite a while to develop an idea to divert these demands, but after eight years they were successful. It was a continuation of the blame game, but this time not blaming our own people but any and all those coming from Europe – and the idea of a Referendum was born. They concentrated on three main issues: Control, Laws and Migration.

  1. Since the referendum we have lost thousands of people wh o formerly worked in our social services and the NHS: these services are now struggling to keep going.
  2. Most laws from the EU have been beneficial, adding to workers’ rights and conditions of employment. EU laws also protect the environment. The UK Parliament as a law-making body remains in control.
  3. This is the most mentioned issue. For whom are the demanding control? The British people have already said they wanted the banks to be publicly owned and demanded tighter controls on financial institutions. Control is such a loose word that can be manipulated by individuals for the benefit of the few.

The promoters of the referendum conducted a continuous campaign of national ‘brainwashing’. Putting relentless pressure on people is not a new idea, as a look back at recent history will confirm.

But unfortunately nearly 50% of the population were aware of the implications of a break with Europe that is our biggest trader of imports and exports, and closest.

A. Delahoy,

Silverknowes Gardens

Capital Coalition set to vote through £207 million tram extension

Edinburgh’s ruling SNP – Labour Capital Coalition is set to give the green light to a controversial £207 million tram line extension today – despite an ongoing  inquiry into the capital’s original trams debacle. Continue reading Capital Coalition set to vote through £207 million tram extension

Holyrood backs Scottish Budget

MSPs back £42.5 billion budget

The Scottish Parliament has approved the 2019-20 Scottish Budget which provides £42.5 billion of investment in Scotland’s public services and economy. Scottish Greens support for the SNP budget ensured the budget was passed.

Finance Secretary Derek Mackay said the budget provides essential funding for health and care services, education, local government and economic investment, while ensuring that 55% of income taxpayers in Scotland pay less tax than those earning the same income in the rest of the UK.

The passage of the Budget comes on the same day as the Scottish Government’s Chief Economist published a report showing that a ‘No Deal’ Brexit would lead to a major dislocation to the Scottish economy, with the potential for national Gross Domestic Product (GDP) to fall by up to 7% and up to 100,000 jobs put at risk.

Mr Mackay said: “The passage of the budget provides £42.5 billion of investment in our public services and economy delivering for the people of Scotland today, whilst building for our future. This is a budget that ensures stability, sustainability and economic stimulus.

“Scotland’s economy continues to grow and unemployment is at the lowest on record but our prosperity is being put at risk by the increasing Brexit uncertainty, and in particular the ‘No Deal’ scenario.

“Today’s Chief Economist report shows that a ‘No Deal’ Brexit would be expected to push the Scottish economy into recession during 2019, with the potential for the economy to contract by between 2.5% and 7% by the end of 2019.

“Such an economic slowdown would risk a rise in unemployment from its current record low, with up to 100,000 more people in Scotland made unemployed.

“This would be an economic shock on the scale of the 2008 financial crisis, and this cannot be allowed to happen.

“We will continue to call on the UK Government to immediately rule out the possibility of a ‘No Deal’ Brexit and extend the Article 50 process. As a responsible government we are also continuing – and indeed intensifying – our work to prepare for all outcomes as best we can. However, while we will do everything we can to prepare, we will not be able to mitigate all of the impacts of the UK Government’s Brexit approach.

“This budget safeguards Scotland as best we can, using all the powers and resources at our disposal with a clear focus on our priorities as a nation.”

You can read the ‘No Deal’ Brexit – Economic Implications for Scotland’ paper here.

The 2019-20 Scottish Budget headlines:

  • Provides more than £180 million in raising attainment in schools, including £120 million through the Pupil Equity Fund to close the attainment gap
  • Continues to deliver a progressive income tax system
  • Includes a public sector pay deal that continues the journey of restoring pay levels and provides an above inflation pay uplift of 3% for those earning up to £36,500
  • Provides the most generous package of business rates reliefs in the UK, and ensures more than 90% of properties in Scotland will be charged a lower tax rate than other parts of the UK
  • Allocates more than £600 million for colleges and maintains investment at more than £1 billion for universities
  • Increases direct investment in mental health by £27 million, taking overall funding to £1.1 billion, including improving mental health services for young people, and providing support in schools, colleges and universities
  • Increases investment in Health and Social Care Partnerships to more than £9 billion for delivery of primary and community health services
  • Delivers new and improved social security benefits based on dignity and respect
  • Provides local government with a real terms increase in both revenue and capital funding, and a real terms increase in total overall support, through a £11.2 billion settlement
  • Prioritises £500 million to expand funded early learning and childcare, supporting the recruitment and training of staff and investment in building, refurbishment and extension of around 750 nurseries and family centres
  • Includes initial funding of £130 million towards the establishment of a Scottish National Investment Bank
  • Protects the police resource budget in real terms
  • Provides more than £20 million for zero waste, supporting the transition towards a more resource-efficient, circular economy, including design and implementation of a deposit return scheme
  • Allocates £80 million for Active Travel to help build an Active Nation
  • Invests more than £825 million, as part of our total investment in excess of £3 billion to deliver 50,000 affordable homes over the course of the Parliament
  • Continues to invest in the £50 million Ending Homelessness Together fund
  • Provides more than £70 million in 2019-20 to drive forward sustainable and inclusive growth in the rural economy

 

 

 Capital Coalition votes through £33 MILLION cuts package

Ray of hope for projects hammered by Health & Social Care grant cuts

Up to 200 council jobs in the Capital will go as the SNP-Labour administration passed a controversial austerity budget which sees £33 million of cuts to vital public services across the city.  Continue reading  Capital Coalition votes through £33 MILLION cuts package