Leaders: Osborne’s Irn-Bru Budget mostly sweet for Scotland

Shares in listed drinks firms dropped sharply on the London stock market after the sugar tax announcement. Picture: John Devlin
Shares in listed drinks firms dropped sharply on the London stock market after the sugar tax announcement. Picture: John Devlin
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IN tackling the child obesity crisis, freezing duty on whisky and increasing Barnett cash, the Chancellor gives us reasons to smile

On the face of it this Budget might appear to be just another demonstration of George Osborne’s skill in misdirection. He missed big important targets on debt and welfare but there was a surprising array of shiney new offerings to grab the attention.

Chief among these of course in the sugar tax, where he intends to introduce a levy equivalent to about 18p-24p per litre on soft drinks. AG Barr, maker of Scotland’s favourite fizzy beverage, described the charge as “extremely disappointing”.

The government hopes the tax will help tackle the ever-worsening child obesity epidemic while raising £530 million a year to be spent on primary school sports in England.

And there were warnings of what is to come as Mr Osborne said the economy would grow more slowly over the next five years than had been expected in November.

The Office for Budget Responsibility (OBR) had previously forecast that the economy would grow by 2.4 per cent this year, but is now predicting a rate of 2.0 per cent.

Growth in the next two years has been cut by 0.3 percentage points while 2019 and 2020 are down from 2.3 per cent to 2.1 per cent.

Mr Osborne has missed his targets, but in a world where the spectre of economic instability is once again looming large, Britain looks as well-placed as anywhere in Europe to weather the storm.

That cannot be said for the North Sea’s decimated oil and gas industry. The Chancellor’s announcement that there will be a major overhaul of the North Sea tax regime is to be welcomed.

Mr Osborne said Petroleum Revenue Tax would be “effectively abolished”, after being cut from 50 per cent to 35 per cent last year.

Among further good news for Scotland was the Chancellor’s decision to freeze duty on Scotch whisky and to allocate a further £5m for the new V&A museum being built in Dundee.

Negotiations will also be opened on City Region Deal funding for Edinburgh and South-east Scotland, and for Inverness, for money from both the UK and Scottish governments which would allow the cities to grow their own economies.

And Scotland’s central allocation under the Barnett Formula will increase by £658m over the next four years.

With an EU referendum on the horizon, things could look very different when Mr Osborne comes to give his Autumn Statement later in the year.

Mr Osborne said the OBR had made clear its economic forecasts were based on the assumption the UK would remain in the EU and had warned that “there appears to be a greater consensus that a vote to leave would result in a period of potentially disruptive uncertainty”.

Indeed, uncertainty has been the common theme of each of the eight budgets Mr Osborne has delivered during his time in office. But on the whole, perhaps there is a deal of substance in what might have been taken for distractions.

Fifa may be scoring an own goal

If Scotland boss Gordon Strachan thinks taking his squad to the next World Cup is the hardest job in football, then he need look no further than Gianni Infantino.

The new president of Fifa, the sport’s governing body, has set himself the task of restoring his organisation’s battered reputation following the craven and self-serving tenure of Sepp Blatter.

Yesterday, Fifa went on the offensive, saying it wanted to reclaim “tens of millions of dollars” taken illegally by its members and other organisations. The body accuses corrupt officials who served on its former executive committee of selling their votes in World Cup bidding contests.

Former officials Chuck Blazer, Jack Warner and Jeffrey Webb are among those being sued by Fifa, which has submitted documents to US authorities. In total, 41 individuals and entities have been charged in the United States.

Fifa estimates millions of dollars were diverted from the sport illegally through bribery, kickbacks and corrupt schemes carried out by the defendants.

But while it now seems clear that bribes were taken, one has to wonder if Fifa has embarked on the right course of action. It now faces a series of protracted court battles with very little prospect of getting its money back.

Mr Infantino would be better making a clean break with the past. He might have been wise to listen to those who called for Fifa to be swept aside and replaced with an entirely new organisation.

Instead, he faces an onerous task of convicing the world that the body he is in charge of is capable of running the beautiful game.