David Mundell: Budget promises are a huge boost for Scotland’s economy

David Mundell, the Secretary of State for Scotland. Picture: John Devlin
David Mundell, the Secretary of State for Scotland. Picture: John Devlin
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The Budget last week delivered for Scotland.

Philip Hammond, the Chancellor, announced landmark measures to support the oil and gas industry.

He backed another vital sector, whisky, by freezing duty on spirits.

He exempted Scotland’s police and fire services from paying VAT – saving them £40 million and fixing a problem created by the Scottish Government.

He committed to the Tay Cities and Stirling and Clackmannanshire city deals we are negotiating and he threw his weight behind a new growth deal, Borderlands.

In addition to all of that, the Scottish Government will see their budget boosted by £2 billion over the next three years as a result of spending announcements south of the Border.

It means their ‘block grant’ – the portion of their funding that comes from Westminster – will increase above inflation between 2015 and 2020.

The package showed the value of having a powerful new block of Scottish MPs who have been prepared to work with the UK government rather than shout from the sidelines.

For the nationalists, it’s always about creating and nursing a grievance.

The last thing they want to see is the UK working for Scotland because it destroys their argument for leaving the UK.

They couldn’t even welcome £1.1 billion in financial transactions that they can now use to unlock investment across Scotland.

Rather than complain, they should seize the opportunity. The Budget exposed how damaging their narrow, negative agenda has been. Far from standing up for Scotland, the nationalists have been holding us back.

The Budget did another thing, too. Raising the threshold for higher rate income tax and abolishing stamp duty for house purchases below £300,000 down south widened the gulf between the tax paid by Scots and people in the rest of the UK.

The gap looks set to widen further when the Scottish Government unveil their budget plans on 14 December. They want to hike income tax on people earning over £24,000.

That would be hugely damaging for Scotland. And with a £2 billion increase in spending power, they need to explain why they still think that is justified.

Devolving income tax has made the Scottish Government much more accountable to the people they serve. Greater transparency of their budget – as called for by Westminster’s cross party Scottish Affairs Committee – is essential.

So to inform the debate about tax and spending choices in Scotland, the Chancellor has also committed to producing a breakdown of the Scottish Government’s block grant.

We’ll see, for example, whether extra spending in England translates into increased support for schools or hospitals here.

And I hope it will make the SNP think again about how they spend money – and how they raise it.

Meanwhile, as the United Kingdom government, we will focus unrelentingly on delivering for Scotland.

The Budget was good for Scotland – but it is not the end of the story. It is just the start.