Oral Answers to Questions
Debate between Peter Grant and Alan Brown(1 month, 2 weeks ago)
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Peter Grant (Glenrothes) (SNP)
Alan Brown (Kilmarnock and Loudoun) (SNP)
Autumn Statement Resolutions
Debate between Peter Grant and Alan Brown(5 months ago)
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Alan Brown (Kilmarnock and Loudoun) (SNP)
It is a pleasure to follow the hon. Member for Bradford East (Imran Hussain). I hope those on his Front Bench were listening to the contributions from him and some of his fellow Labour Members, because it is important that we talk about plans to remedy things and help the poorest in our society.
This is clearly a zombie Budget from a zombie Government —a Budget so good that, as others have said, the Back Benches on the Government side are practically empty. If it was meant to be a pre-election Budget, it is a pre-election Budget that is not generating any confidence among Conservative Back Benchers, because none of them wants to be here to debate it and try to talk it up.
It is a bold Chancellor who tells us that he is cutting taxes when we still have the highest tax burden in 70 years, with more tax rises on the way, and at the same time living standards continue to fall. Just today, Ofgem has announced that the energy cap will increase again in January—it will still be approximately double what energy costs were two years ago. It is little wonder that the OBR predicts that living standards this year will be 3.5% lower than before the pandemic.
The Chancellor was bold enough to talk about wage growth, but let us look at the detail. The Resolution Foundation confirmed that it will take until 2028 to get overall wages back to 2008 levels—two lost decades of wage growth. At the next general election, it will be the first time ever that household incomes have been lower at the end of a Parliament than they were at the start.
It is clear that the Budget does nothing for the approximately 6.3 million fuel-poor households. Ofgem has confirmed record cumulative energy debts of £2.6 billion, so we are still in the grip of a cost of energy crisis. The Tories tell us that we should be grateful for the energy support package, which cost in the order of £40 billion, but let us look at the example of Norway, which is drawing a further £30 billion from its sovereign wealth fund this year alone. That will not even make a dent in its £1.1 trillion sovereign wealth fund—yes, £1.1 trillion, which makes it the biggest such fund in the world. Energy-rich Scotland still exports six times more oil and gas than it consumes, and yet we are supposed to be grateful that the UK as a whole is planning to slightly reduce its £2.5 trillion debt. All those oil and gas revenues have been frittered away through short-term planning. Norway did not create its fund until the 1990s, so it is a disgrace that we do not have a North sea legacy to fall back on in these hard times.
We are also supposed to be grateful about the 2% cut to national insurance contributions, and that the Tories have—so they claim—reduced inflation from 11.4%, even though they were partly responsible for the high rate because of the disastrous mini-Budget and the impacts of Brexit. It is curious that the Government tell us that they are not responsible for high inflation as it is a global issue, and that high interest rates are set by the wholly independent Bank of England, but now that inflation is falling, we are to believe from the autumn statement that the Government’s actions have brought it down. The Government appear to be responsible for inflation rates only when it is good news and they are going down—that is quite a trick.
Let me return to household energy. It is a scandal that about a fifth of UK households are living in fuel poverty. It is a bigger scandal that energy-rich Scotland has fuel poverty at all, as well as the highest energy bills and some of the highest standing charges just to access the energy grid. Those standing charges mean people cannot afford to heat their homes properly. Indeed, the Joseph Rowntree Foundation estimates that 2 million people are switching off their fridges and freezers intermittently to save on energy costs. This autumn statement will do nothing to help those people—or, if it does, any money that goes into their pockets in January will quickly be removed in April as the tax threshold freeze means more people become liable for income tax. Households are paying on average £800 a year more on energy costs than two years ago, but the warm home discount scheme has increased from £140 to £150 a year. It is plain: the sums do not add up. However, the Government have also reneged on their pledge for a social tariff to help the most vulnerable with their energy costs.
Let us look at the national insurance cut in the round. Although hard-working people, especially those on the eligibility threshold, will of course welcome having to pay less, it is unfortunately no coincidence that the £19 billion package to support the cut will be offset by £19 billion of public spending cuts that are still to be determined. Who is most affected by public spending cuts? Of course, it is the lowest paid and the poorest in our society. Such spending cuts make a further mockery of the Government’s so-called levelling-up agenda. The budget of the Department for Levelling Up, Housing and Communities was halved in the statement, which says everything about levelling-up targets. If the Government introduce a tax cut via emergency legislation, only to pay for it through future departmental cuts, they cannot possibly claim that that is part of responsible Government taking long-term decisions for the economy. It is quite clearly a gimmick to capture headlines.
In Scotland, of course, we are also meant to be grateful for the Barnett consequentials, which have already turned out to be lower than was announced. The Scottish block grant itself is being cut in real terms in the autumn statement. Next year, the grant increases from £35.8 billion to £36.9 billion, but if we compare that increase with headline inflation from September, it is clearly a real-terms budget cut of about 3.5%, or £1.3 billion, for Scotland.
Then there is the capital budget allocated to the Scottish Government, which is being cut outright from £6.2 billion to £5.6 billion in two years’ time. That is not even a real-terms budget cut, but a hugely damaging slashing of the budget, at a time when the Scottish Tories demand that the Scottish Government invest in all sorts of infrastructure projects. I am sure that the Scottish Tories will recognise this conundrum of a cut budget, demand that the capital budget is restored, and recognise the pressures on the Scottish Government, let alone the inflationary pressures on projects that are already under way. [Interruption.] As my hon. Friend the Member for Glenrothes (Peter Grant) points out, no Scottish Tories are even here to talk about the statement.
On infrastructure, we are yet again being let down by the lack of progress on agreeing an electricity cap and floor mechanism for pumped storage hydro. That means further delays to SSE’s Coire Glas scheme and Drax’s Cruachan dam extension. We keep hearing that the Government want to unlock private investment. In pumped storage hydro, private investment in the order of £2 billion to £2.5 billion would be unlocked by agreeing an electricity export mechanism for those schemes. That would create jobs in the highlands of Scotland and, importantly, provide better balance for the grid, reducing bills overall. Why the continued intransigence from the Government on pumped storage hydro?
Despite talk of investment in green energy, the statement and the Green Book do not mention energy storage even once—that is a dereliction of duty. Tidal stream, in which Scotland leads the way, is not mentioned either. Looking at the statement in detail, the so-called £4.5 billion manufacturing investment and the £960 million green growth accelerator do not have corresponding budget lines, so those announcements are clearly recycled announcements, in the finest style of this Government.
As we have heard, the indicative blank cheque for nuclear was mentioned once again. We have the fantasy of small modular reactors, but they are not actually small. First, they exceed the industry definition in terms of generation capacity, and secondly, they are the size of two football pitches, which is not exactly a small footprint. The terminology is designed to make them sound small and cosy when they are anything but.
Let us look at the evidence on the development of these projects. The most advanced SMR project in the world, NuScale in Utah, has just been shelved because capital costs have increased to $9 billion—the equivalent of over £7 billion. That is evidence that SMRs are too expensive to progress, but the UK Government are pretending they can deliver them for about £2 billion per reactor. That makes no sense, especially when nuclear technology is generally more expensive in the UK anyway.
We now come to my hobby-horse: Sizewell C. Despite the cost of Hinkley Point C increasing from £18 billion to £33 billion, the rampant inflation we still have and Sizewell C being built on an area subject to coastal erosion and flood risk, we are told that it will magically provide value for money and be cheaper than Hinkley Point C. It is truly delusional. No pension funds want to invest in Sizewell C, and the Government have the begging bowl out. Despite introducing the regulated asset base model and transferring further risk to bill payers, they are still struggling to raise finance.
It is time that the Government ended this charade. It is bad enough that over £1 billion has already been spent just on design development for Sizewell C. That is £1 billion that could have been spent on energy efficiency measures, infrastructure or even further energy support schemes.
Peter Grant
Is my hon. Friend surprised or disappointed, or is it purely to be expected, that there is not a single word about insulation or energy efficiency measures anywhere in the autumn statement?
Alan Brown
All of the above. It is infuriating. If the Government were to listen, even the energy supply companies want them to invest more in energy efficiency and insulation. Right now, in the ECO4 scheme—energy company obligation 4—the companies cannot even find the requisite number of properties to upgrade. As that goes on, we are losing the supply chain instead of building it up.
If we really want green growth, green jobs and lower energy bills, it is perfectly obvious that more money should be spent on energy efficiency. Ironically, the Government never listen to that, but they should listen to the third sector and the energy companies who praise the Scottish Government for their direct investment in support of energy efficiency programmes. In contrast to the Government’s blank cheque for nuclear, Scottish renewable projects still have to pay the grid charging penalty, making it harder for them to compete in the contract for difference auctions.
This autumn statement means that we still have an incoherent energy policy. It does nothing for Scotland. Hard-working families are still going to suffer, living standards are still falling, and the disabled are now threatened with losing support unless they are forced into jobs not of their choosing. It is not difficult to choose a different path for Scotland—it is a path that other smaller countries in western Europe are already on, so why not Scotland? It is time we took that different route.
Oral Answers to Questions
Debate between Peter Grant and Alan Brown(2 years, 1 month ago)
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Peter Grant (Glenrothes) (SNP)
Alan Brown (Kilmarnock and Loudoun) (SNP)
The Parliamentary Under-Secretary of State for Health and Social Care (Maggie Throup)
In advance of the living with covid announcement on 21 February, ministerial colleagues discussed our living with covid strategy with the devolved Administrations. Officials were also in regular touch to understand the approach being taken by each Administration and any implementation issues.