Philip Hammond: Scottish Government to receive additional £350m in spending from budget

Written by Liam Kirkaldy on 8 March 2017 in News

Finance secretary Derek Mackay questions how Brexit could affect Scottish and UK Government plans

Philip Hammond - credit: PA

The Scottish Government will receive an additional £350m in spending from changes brought by the budget, according to chancellor Philip Hammond.

Unveiling his fiscal plans, the chancellor said the increase in funding, brought as a consequence of increased spending at a UK level, would allow Holyrood to “take further steps to strengthen Scotland's economy and make sure that Scottish people, of all background and no matter where they live, feel the benefits of economic growth.”

Alongside support for the oil and gas industry, Hammond said the Scottish Government would receive an extra £260m over the next three years, with its capital budget rising by £90m up until 2021.


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But finance secretary Derek Mackay questioned how Brexit could affect Scottish and UK Government plans.

He said: “The real elephant in the room in this budget was Brexit. There was no mention of the UK government's plans to protect and grow the UK economy as the prime minister gets ready to trigger Article 50.

“This is simply not acceptable. Brexit is a real threat to people across Scotland in so many ways. The chancellor must tell us his plans.”

Hammond pledged to investigate the use of tax incentives to encourage operators to sell oil and gas fields, with a panel of experts set to be established to examine the issue.

Hammond also came under fire over plans to increase National Insurance contributions (NICs) for the self-employed, with the Conservatives having pledged a freeze in the run-up to the election.

The plans will see 2.5 million people paying £240 more per a year in Class Four NICs, raising an extra £2bn for the Treasury by 2022.

Class Four NICs for the self-employed would rise from nine per cent to ten per cent next April and again to 11 per cent in 2019.

But the chancellor faced fierce criticism from Labour leader Jeremy Corbyn, who questioned the decision to cut to corporation tax and inheritance tax, while those on low-incomes continue to struggle.

He said: “This was a Budget of utter complacency about the state of our economy, utter complacency about the crisis facing our public services and complacent about the reality of daily life for millions of people in this country.”

Corbyn added: “Just imagine what it's like to try and plan your life if you don't know what your income is going to be from one week to the other - because that is the reality.”

"There is nothing funny about being one of 900,000 workers on zero hours contract, 55% of them women.

“He could have announced a ban on zero hours contracts, as we are pledged to do, again he failed.

"But zero hours contracts are only the tip of an iceberg. 4.5 million workers in Britain in insecure work, 2.3 million working variable shift patterns, 1.1 million on temporary contracts.”

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