Fiscal stimulus for Scotland amid more economic warnings over Brexit fallout
Nicola Sturgeon expected to announce fiscal stimulus package for Scotland to stabilise economy
Nicola Sturgeon - credit Holyrood/David Anderson
First Minister Nicola Sturgeon will today announce she will bring forward planned investments in Scotland’s infrastructure in an attempt to boost the country’s economy in the wake of the EU referendum result.
Sturgeon is also expected to call for the UK Government to provide a boost for the Scottish economy, despite new UK chancellor Philip Hammond ruling out an emergency budget.
The Bank of England’s post Brexit plans have also stumbled, after it failed to buy enough government bonds for its stimulus programme.
The UK vote to leave the European Union has created uncertainty, Sturgeon is expected to say.
"The UK government has not yet taken a single meaningful step to alleviate that uncertainty, so the Scottish government is taking early action to boost confidence, stimulate economic activity and reassure business.”
She will add: "The UK government also needs to act urgently and create a UK-wide stimulus package, including enabling the Scottish government to do more to accelerate capital spending."
The move comes as economic thinktank the Institute for Fiscal Studies (IFS) warned the UK could lose the equivalent of 4 per cent of economic output if it failed to secure a new trade deal with the EU before it leaves.
Scottish secretary David Mundell is in Glasgow today to discuss a “Team UK” approach to Brexit negotiations with key figures from business and industry.
"My task is to ensure that Scottish voices and interests are at the centre of the negotiations to come, and that is why this engagement is so important,” he said.
IFS research associate Ian Mitchell added: "From an economic point of view we still face some very big choices indeed in terms of our future relationship with the EU.
"There is all the difference in the world between 'access to' and 'membership of' the single market. Membership is likely to offer significant economic benefits, particularly for trade in services."
Meanwhile the UK’s trade deficit with the rest of the world increased by £900m in June, according to the Office for National Statistics, as imports reached a record high level of £48.9bn.
The ONS also indicated that Britain’s trade deficit with the European Union has widened by £400m over the last three months.
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