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The Scotsman Politics: Spring Budget 2024 Review
The Scotsman
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06/03/2024
The Scotsman Politics: Spring Budget 2024 Review with Dale Miller and Alexander Brown.
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00:00
(upbeat music)
00:02
- Hello, and welcome to the Scotsman's Politics Show
00:11
where we are reviewing the spring budget.
00:15
Chancellor Jeremy Hunt has stood up.
00:17
He has given us his rundown about the big commitments
00:21
and announcements made by the UK government.
00:24
And I'm here with Westminster correspondent,
00:26
Alexander Brown to take us through everything.
00:28
Alex, there were some key pledges mooted
00:32
in the buildup to this national insurance windfall tax.
00:35
Non-dom status, did we get everything that we expected?
00:38
- We got everything we expected.
00:41
And in fact, there were no rabbits.
00:43
So much of the talk around Westminster had been,
00:46
oh, you know, maybe he'll cut income tax as well.
00:48
Maybe they'll go further.
00:49
And so the government can have an election in May.
00:52
There'll be something, some huge pitch to voters.
00:54
But when you go through the measures
00:56
and the financial package and the size of it,
00:58
in reality, this was smaller than the autumn statement.
01:01
This was not a significant spread of packages.
01:04
It's cutting national insurance.
01:06
Again, the non-dom is a significant U-turn,
01:10
but it's very interesting that when Labour wanted
01:12
to get rid of non-dom status,
01:13
the government said it would cost them 350 million a year.
01:17
Now, the Chancellor is saying it can save
01:19
the government money and it can bring in money
01:23
to the public purse.
01:23
So there weren't any real surprises.
01:26
I think the main takeaway having heard that is,
01:28
a May election is less likely than it maybe was this morning.
01:32
I think the Chancellor has left himself room for,
01:35
and he did hint at the idea of further tax cuts.
01:38
He wants to get to a position where they can have
01:40
more long-term tax cuts of maybe another fiscal statement
01:44
later this year, which suggests an autumn election.
01:46
- So you say no rabbits out of the hats.
01:50
Were there any surprises today?
01:52
Anything that we didn't expect
01:54
that you picked up from the start?
01:57
- No, I mean, I felt quite content actually in our coverage
01:59
and that we had said, I'd said that there would be a wind
02:02
for the windfall tax would be extended
02:04
and the government weren't confirming that,
02:06
but I'd spoken to a few people.
02:07
And then indeed there has been an extension
02:09
of the windfall tax, which raises huge questions
02:12
for the Scottish Tories.
02:14
Douglas Ross, I think has already said
02:16
that he will vote against it.
02:17
And we now know that he made very public condemnation of it
02:21
and made a pitch to the prime minister and to the chancellor
02:24
to the extent that they had to have a meeting
02:26
with the Scottish secretary to discuss it.
02:29
The camera in PMQs cut to him at one point
02:32
where they were talking about where the chancellor said
02:34
he was a champion of Scotch whiskey
02:36
and Douglas Ross did not look pleased at all.
02:40
We also knew that there was very unlikely
02:43
to be a cut in spirit duty and indeed it was frozen.
02:46
Now the government would say,
02:48
oh, this is actually a great news.
02:49
This is a surprise.
02:50
It means people won't be paying more.
02:52
Scotch whiskey association,
02:54
while they welcome not having to pay more,
02:56
are still very unhappy and still say
02:58
that it's a fundamental misunderstanding of their industry
03:01
and has seen the prior thing,
03:03
Scotch whiskey is taxed four times the price of cider.
03:06
So industry is not very happy.
03:08
And I think one thing that's really worth looking at
03:11
is in making these tax cuts
03:13
and making that financial wiggle room to national insurance,
03:16
it's created, I've been, I'm doing the math
03:17
and I'm looking at my notes here.
03:19
Essentially there will have to be cuts
03:20
of 20 billion a year by 2028.
03:24
So the government talked about running a clean estate,
03:28
a tight estate.
03:28
It's not gonna increase funding for the NHS.
03:30
It's just going to do it more intelligently.
03:33
But hearing about these tax cuts
03:35
and knowing that more and more are planned,
03:37
the huge cuts of public services are coming.
03:39
And I mean, the SNP and Labour had both warned
03:41
this is a government that will be cutting
03:43
public services to the bone.
03:44
And while it wasn't framed like that
03:46
and it was framed as streamlining and admin,
03:49
these tax cuts come at a huge cost.
03:51
And I think it's quite telling that we expect Labour
03:53
to be the ones who probably have to manage it
03:56
after they've come in.
03:57
- Now, Alex, just circling around to the alcohol duty
04:00
and the whiskey, I know you'd written on Sunday,
04:04
effectively the Scotch Whiskey Association,
04:06
where after a cut to duty,
04:09
just the fourth time by a chancellor in a century.
04:12
So I can say just holding it
04:15
is not exactly what they wanted.
04:17
You mentioned the election there.
04:18
So, and there was speculation over
04:23
whether it could even be May.
04:24
On the back of this, you're indicating
04:26
that seems pretty unlikely.
04:28
- Yeah, I don't think anyone is especially moved
04:32
by the idea of cutting national insurance.
04:34
I mean, if cutting national insurance by two points
04:37
was enough to improve the polls,
04:38
the Tories would have done much better
04:40
after the autumn statement last year
04:41
when Jeremy Hunt cut national insurance by two pence.
04:46
So it's a further cut.
04:48
It's 900 pounds for the average person
04:50
a year in their pocket.
04:51
I think it saves 27 million people money.
04:55
And that's very helpful,
04:56
but all the polling shows that people don't really,
04:59
it's not about tax for people anymore.
05:00
It's about funding for public services.
05:02
So I'm not necessarily sure repeating the trick is enough.
05:06
And I was speaking to MPs and activists this morning,
05:10
and one of them was saying to me,
05:12
"I think there's gonna be a May election.
05:13
"I think we have to go early
05:14
"because things are not going to get better.
05:17
"And if we do it now,
05:18
"it avoids the aftermath of the local elections
05:21
"and the Blackpool by-election and the mayoral elections,
05:24
"all of which the Tories are expected
05:26
"to take a battering in."
05:28
But the same person also said,
05:29
but also, "I know that's suicide.
05:32
"I know to go for it now is to see a wipeout,
05:35
"but to wait longer could see an even bigger wipeout."
05:38
So there is still mixed feelings about this.
05:40
The head of the Treasury Select Committee,
05:43
a Conservative MP said this morning,
05:45
she was preparing for a May election,
05:47
but that doesn't mean that there's going to be one.
05:50
There seems to be a real mix of moods
05:53
and attitudes on it in Downing Street.
05:55
I spoke to one person who I know
05:57
is categorically ruled out as it's not going to happen.
06:00
Senior government figures today were briefing
06:02
that there is not going to be an early election,
06:04
but we've seen an ambassador told
06:07
they can't attend an event in April,
06:09
and they haven't explained why.
06:11
That suggests they might have to be here for an election.
06:14
So we're all kind of looking at things.
06:17
Everything that MPs tell us now,
06:19
or every slight ambassadorial decision is suddenly going,
06:22
"Does that mean election?"
06:23
And the only one who really knows is Rishi Sunak,
06:26
if he's even decided.
06:27
- Alex, very last question.
06:29
I may know the answer to this,
06:31
but what will the Scottish government think of this budget?
06:34
(Alex laughs)
06:35
- I mean, I imagine even before having seen the budget,
06:38
the Scottish government would think it was very bad,
06:40
but I think we know that under this,
06:42
the Scottish government gets 300 million pounds
06:46
in further consequentials under the Barnett formula,
06:48
but the tax cut costs the government 9 billion.
06:52
So the government is giving 300 million to Scotland,
06:55
but it is taking 9 billion out of the public purse.
06:58
So I know 300 million seems like a lot of money,
07:02
but it doesn't actually go very far
07:03
when we're talking about infrastructure projects
07:05
or regeneration and funding long-term economic plan
07:10
or whatever.
07:10
So I imagine they won't be very happy.
07:12
And I know that we heard from Stephen Flynn
07:14
that he wanted 15 billion more for the NHS,
07:18
and instead they've maintained the current levels of funding.
07:21
So they won't be very happy.
07:24
There's not really any rabbits for them.
07:26
And between the oil and gas,
07:28
though I suppose they maybe have a crossover
07:30
on oil and gas because they also don't support
07:33
an extension of the windfall tax.
07:34
So there's nothing there for them.
07:37
There'll just be more complaints.
07:39
- It'll be interesting, Alex, on the back of this,
07:41
whether they say there's any more money
07:43
to help with the housing situation up here in Scotland,
07:46
which Shona Robison was very clear that any money
07:50
that was up and above expectations
07:52
would be going towards that avenue.
07:54
Alex, thank you very much for joining us.
07:56
You can read all the coverage on the budget at scotsman.com.
08:01
There is a designated area on the site
08:04
specifically for budget coverage,
08:06
but you can also click on the politics tab
08:08
for all the latest.
08:09
Please follow us on Facebook, Instagram, and X,
08:12
and buy a copy of the paper tomorrow.
08:15
Until then.
08:16
(upbeat music)
08:18
(upbeat music)
08:21
you
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