Contribution
It is a pleasure to serve under you as Chair, Ms Vaz. I congratulate the hon. Member for Livingston (Gregor Poynton) on securing this debate on the impact of the UK Budget on Scotland.
I welcome the increase in investment for the NHS and the vital cash boost for Scotland, but with all due respect to the hon. Member for Angus and Perthshire Glens (Dave Doogan), it cannot be underestimated how much we needed it, given the mess and chaos that the SNP Government have created in our public services over the past 17 years. Indeed, they have also created chaos in our ferries, as we heard today that the new Glen Sannox is being removed from service again. I agree with the comments from many Members, particularly my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone), about the problems that we are facing.
While I welcome the money in the Budget, we have heard repeatedly from the Chancellor and other Ministers —no doubt we will hear it again today—that the Government have had to take tough decisions since coming into office. Many of my constituents in Edinburgh West are beginning to say, “Yes, every Government have to make tough decisions, but did this one have to make these decisions?”
Before Christmas I spoke to a number of businesses in Edinburgh West, and many of them were concerned about the negative impact that increases in employer national insurance contributions will have on them. Some are worried that they will have to make cuts to staff; others are trying to avoid putting up prices and passing the tax hikes on to the public. All of them are trying to find ways of making it work, and all of them are struggling. Some 40% of Scots now believe that more small and medium-sized enterprises will close in their communities as a direct result of this Government’s decisions. More than half of Scots believe that prices will have to go up. After the worst cost of living crisis in a decade, that is not what any of them needed.
GPs and many social care providers are saying that they do not know how they are going to cope with the tax changes. Private contractors or operators, who will not be eligible for employment allowance, will have to take on those extra costs directly. Within days of the Budget, several GP practices contacted me and estimated that the changes will cost them more than £10,000 extra in the next year. After 17 years of mismanagement under the SNP and 14 years of the Conservatives, our GPs need support and investment, but everywhere we look in Scotland, the impact of this Budget is not positive.
Another tax change that will have direct consequences for my city of Edinburgh is the Government’s decision to impose VAT on private school fees. It is not just because I do not support taxing education or reducing the choice of parents that I do not agree with the proposal and see it as negative, but because it will have a real impact on both the state and independent school sectors in Edinburgh. Edinburgh has the highest proportion of independently educated children in Scotland, at between 20% and 30% every year.
According to the local Labour authority, 16 schools are expected to reach capacity before the end of this decade. If the predicted percentage of children dropping out of independent education into the state sector is true, the system will be stretched to breaking point. Sadly, introducing the change halfway through the school year is causing issues for many parents. I have already had representations from parents who cannot find places in local schools for the children they have taken out of the independent sector.
I would have liked to touch on other issues, including the impact on the whisky industry—I refer Members to my entry in the Register of Members’ Financial Interests—and the farming industry, which was touched on by the hon. Member for Gordon and Buchan (Harriet Cross). However, it is sufficient to say that Scotland, which is already under pressure from mismanagement by the SNP, is now facing a far-from-positive impact from the new Westminster Government in which it put its faith.