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Volume 746: debated on Wednesday 6 March 2024

The Secretary of State was asked—

Financial Settlement for Scotland

Last weekend Scotland once again showed the world that we can host fantastic sporting events, with the World Athletics Indoor Championships held in Glasgow. I offer my congratulations to everyone involved, and especially to medal winners Jemma Reekie from Ayrshire and Josh Kerr from Edinburgh, who was the first Scottish man to win a gold medal in those championships in over 30 years. I also congratulate the Scottish rugby team who, thanks to their recent victory over England, have now won the Calcutta cup four times in a row. It would have been five in a row, but covid got in the way. [Laughter.]

Contrary to what we hear from the Scottish National party, the Scottish Government are well-funded. This UK Government have provided a record block grant, averaging £41 billion a year, with an additional £2.4 billion across the last three fiscal events. Scotland also continues to benefit from the Barnett formula, under which the Scottish Government receive around 25% more funding per person than equivalent spending across the United Kingdom.

Will the Secretary of State explain how his Government’s £1,600 million cut to Scotland’s capital budget over the next three years will impact the provision of infrastructure, including roads, hospitals, schools, new homes, digital connectivity, and the economic growth we need to escape the recession into which the Tories have dragged us?

It is nice to see that the hon. Lady and her colleagues have turned up for work today, even if that is in defiance of the deputy Leader of the SNP, who thought they should not bother coming. Let me be clear on resource spending and the capital budget: the Scottish Government are able to divert their resource spending for capital infrastructure investments; and they can also borrow to enhance capital investments if they so choose.

The Secretary of State is correct that the block grant from the UK Conservative Government to Scotland is the highest it has ever been. Despite that, just last week the SNP/Green Government pushed through their “tax and axe” budget in Scotland. Does my right hon. Friend agree that the nationalists have got the wrong priorities for Scotland by cutting services while increasing income tax rates for anyone earning more than £28,867?

I agree with my hon. Friend, and I add further that the Scottish Government’s six tax bands, as opposed to the UK Government’s three tax bands, are really holding Scotland back.

While the SNP and the Tories argue about the financial settlement between the two Governments, they do agree on two things: first, that working people should pay the price of this economic mess, by raising tax to sky-high levels; and secondly, at least until today, that oil and gas giants earning record profits should not face a proper windfall tax, although it now seems as if the SNP might be the only people holding out on that position. Who does the Secretary of State support—the Scottish Tory leader who is standing up in Holyrood today attacking an extension of the windfall tax, or the Chancellor who we understand is about to announce exactly that?

My position has always been clear: I believe that the energy profits levy on the excess profits caused by Putin’s illegal war in Ukraine was the right thing for the Government to do, to give support to people in the cost of living crisis.

It started so well, and I agree with the Secretary of State about the Calcutta cup—I was there to witness an historic occasion—and about the World Athletics Indoor Championships in Glasgow. I played rugby with Jemma Reekie’s cousin for many years, and I send my congratulations to them. However, everything from that point on, from both sides of the House, has been absolute nonsense.

At a time when many Scots are struggling to pay their energy or shopping bills due to the rapid inflation that the Secretary of State’s Government have presided over, and with inflation in the public sector running even higher, his Government have cut the Scottish Government’s funding in real terms again. Commons Library research shows that the Scottish block grant will be at its lowest level of UK Government spending since the start of devolution. As the Secretary of State counts down the weeks to his departure, is he proud of his legacy?

That is an easy one to answer, Mr Speaker, as I am very proud of my legacy. Rather like winning four Calcutta cups, I have won in court with the Scottish Government four times, and there are any number of things I would like to list for my legacy. Importantly, the Scottish Government receive a record block of £41 billion, and record Barnett consequentials on top of that. Spending in Scotland is 25% higher per person than the UK average, so that equates to an extra £8.5 billion.

I had no idea we should all just be very grateful for the largesse of the Secretary of State, but does that largesse extend to capital funding? Capital funding to the Scottish Parliament has not just been cut, but slashed by 10% on his watch. That money could have been used to invest in hospitals, schools and infrastructure, and it is about to be frittered away by the Chancellor on a sickening pre-election bribe that precisely no one will buy. Will he finally accept that it is his Government’s “bust or bust” austerity that is driving public services to the edge, and does he support tax cuts at a time when even Tory voters know that increased public investment is required?

This is nonsense. Austerity is not a thing under this Government—not a thing at all. [Laughter.] No, absolutely not. Departmental spending—this is the point that the SNP does not acknowledge—throughout this Parliament has grown by 3.2% on average. That is the simple truth.

International Relations

2. What discussions he has had with (a) the Scottish Government and (b) Cabinet colleagues on the Scottish Government’s international relations policy. (901747)

I have had frequent and recent discussions with the Foreign Secretary on the Scottish Government’s international relations policy. Foreign affairs are reserved to the United Kingdom Government. We have been clear to the Scottish Government that they must respect that.

First, may I associate myself with the Secretary of State’s comments about the Scottish victory in the Calcutta cup?

Does the right hon. Gentleman share my concern that these recent forays into international relations by the SNP are not only inappropriate, because it is a reserved matter, but potentially damaging, both to important relationships between Scotland’s two Governments and, critically, to UK foreign policy at a time when international tensions are at a height we have not seen since the cold war?

I agree with the hon. Lady. It is important that the United Kingdom Government speak with one voice and the United Kingdom is seen to speak with one voice on foreign affairs. I note that Angus Robertson has produced another independence document this week on foreign affairs and defence, and there is a lot of nonsense in there. The Scottish Government want to join the NATO nuclear alliance, but they want to get rid of the nuclear deterrent. They want to join the EU, but not the euro. They want to have a Scottish spy agency—some are referring to it as the sleekit service, with agents heading across Europe in their bulletproof motorhomes. It is all nonsense, and a complete waste of taxpayers’ money.

Promoting Trade with Northern Ireland

3. Whether he has had recent discussions with Cabinet colleagues on promoting trade between Scotland and Northern Ireland. (901748)

I am pleased to say that I have had discussions with the Secretary of State for Northern Ireland about maximising trade links, now that the Northern Ireland Executive have been restored. What is more, the UK Government have committed to establishing the East-West Council, which will identify opportunities for deepening connections between Northern Ireland and the rest of the United Kingdom, including the scope for extending the Northern Ireland investment zone benefits to Stranraer and Cairnryan.

Will the Minister ensure that business bodies in Scotland are fully aware of, for example, the new Intertrade UK body so that business can prosper between Northern Ireland and Scotland? Importantly, will he ensure that people can see the improvement in business trade flows between Scotland and Northern Ireland in six months’ time, as compared with six months ago?

As set out in the Command Paper, the UK Government are working to establish Intertrade UK, which will fulfil our pledge to grow the economy by ensuring that businesses large and small can make the most of the east-west trading opportunities. Implementing the Windsor framework and the Command Paper are the Government’s priorities, and we will provide an update in close time.

Cost of Living

We prioritised bringing inflation down, which is the key to reducing cost of living pressures. We delivered on the Prime Minister’s promise by more than halving it. In addition, the UK Government supported households with a package worth £104 billion—or, on average, £3,700 per household across the United Kingdom, including in Scotland.

Families in my homeland are reeling from the cost of living crisis, as both the Tory UK Government and the SNP Scottish Government have jointly loaded them with the highest tax burden in 70 years. Does the Minister agree that it is time both Governments stopped going round in circles, left the dance and cleared the floor for Labour Governments to sort out their sorry mess?

I do not agree with the hon. Gentleman’s conclusions. Thanks to this Government, 2.4 million workers in Scotland benefited from £340 back in their pockets thanks to the national insurance cuts in January. However, I do agree with him in not agreeing with the SNP Government’s approach to tax, making Scotland the highest-taxed part of the United Kingdom.

Scottish rail fares are set to rise by 8.7% next month. This eye-watering fare hike will hit Scots hard during a cost of living crisis and push Scotland’s rail service into a spiral of decline. Does the Minister agree that we need affordable fares to help people through the cost of living crisis and encourage more people to travel by train?

I certainly agree that we should do all we can to encourage people to travel by train. The Scottish Government’s approach to ScotRail might discourage that. I am happy to meet the hon. Member to discuss that further.

Recent findings from the Trussell Trust have revealed that 32% of people claiming universal credit in Scotland have fallen into debt because they could not pay essential bills. Does the Minister agree that the people of Scotland and the people of Britain should not be made to pay for SNP and Tory failures?

In 2021-22, there were 1.7 million fewer people in absolute poverty after housing costs than there were in 2009-10, including 400,000 fewer children. This Government are certainly taking lots of action to address poverty, and particularly in-work poverty. But I agree that making Scotland the highest-taxed part of the UK does not help with that.

Does the Minister agree that putting up taxes as the SNP is doing at present will do nothing to help with the cost of living? Does he further agree that if it continues on that trajectory, more and more Scots will want to leave and come to places such as Carlisle, where of course they will be very welcome?

Due to the SNP’s tax rises in Scotland, anyone earning more than £28,867 will pay more income tax than those living in England. From my own experience representing a Borders constituency, I see increasing evidence of people choosing to live south of the border rather than in the high-tax Scottish jurisdiction. In my discussions with science, technology, engineering and maths businesses, I find that they are finding it increasingly difficult to recruit in Scotland because of the aggressive high-tax policies of the SNP.

Regardless of what the Chancellor announces today, we are in the highest tax-raising Parliament in history, which is a consequence of the Minister’s Government’s failure over 14 years. Ordinary hard-working Scots did not cause this economic crisis—the Government did—but they are being made to pay for it. There have been 25 Tory tax rises since the last election, and the average family is much worse off as a result. Does the Minister agree with the Institute for Fiscal Studies that even after today’s Budget the overall tax burden on working people will still reach record levels?

Clearly, I will not speculate on what the Chancellor will announce shortly. I remind the hon. Gentleman that 2.4 million workers in Scotland have benefited from £340 going back into their pockets thanks to the changes to national insurance that have already been announced.

In relation to the hon. Member’s wider points about the tax burden, we should not forget the huge interventions that the Government made to support workers, families, communities and businesses during the pandemic. As a consequence, we are having to repay that, but that saved jobs and many businesses from going under during the covid pandemic.

Regardless of what the Chancellor says today, working people will still be paying a much higher tax burden at the end of this Parliament, and it will reach record levels. Shockingly, the tax burden in Scotland is even higher. Anyone in Scotland earning more than £29,000 a year will pay more income tax after the SNP voted for yet another tax rise on working people. That means we are in the absurd position in Scotland of the SNP raising taxes on nurses and teachers while opposing Labour’s plan for an extended windfall tax on the oil and gas giants. We even hear that the leader of the Scottish Conservatives threatened to resign last night on potentially another U-turn from the Chancellor on the windfall tax. Does the Minister accept that the best thing to happen now would be for this circus to be brought for an end and for the Prime Minister to call the election?

As I said, I will not speculate on the contents of the Budget. But when the election comes, Scotland’s voters will have a clear choice: a party who will stand up for Scotland’s place in a strong United Kingdom, or the Scottish National party, who wants another referendum. I am unclear what the Labour party has to offer.

Farm-gate Prices

6. Whether he has had recent discussions with Cabinet colleagues on farm-gate prices for farmers and crofters in Scotland. (901751)

We want all farmers to get a fair price for their products. The Government have committed to tackling contractual unfairness in the agrifood supply chain. We will use the powers in the Agriculture Act 2020 whenever necessary. At the National Farmers Union conference, the Prime Minister announced that the UK Farm to Fork summit will be an annual event. That will help to strengthen joint working by Government and external partners to support a prosperous agrifood sector.

The Minister should be aware that his colleagues in the Department for Environment, Food and Rural Affairs have recently concluded a consultation on contractual relationships in the fresh produce industry. At a time when 23% of dairy farmers doubt that they will continue in business into 2025, will he impress on his colleagues in DEFRA and the Department for Business and Trade that urgent action is needed in relation to that consultation?

As the son of a Borders farmer, I completely understand the invaluable work that farmers and crofters do to put food on tables across Scotland and the United Kingdom. This Government will continue to support the agriculture and food production sector. Scotland Office Ministers regularly attend the inter-ministerial group for environment, food and rural affairs, along with representatives from the devolved Administrations. This group oversees how changes to price, supply and trade affect our markets. We will continue to take whatever action is necessary support that important sector.

Allegations of Impropriety in Public Life

7. What assessment he has made of the potential implications of allegations of impropriety in public life for his Department's work on strengthening the Union. (901752)

Our Union is strong. [Interruption.] Yes, it is. Scotland’s contribution to our United Kingdom is beyond doubt, and this Government’s commitment to Scotland is without question. From freeports and investment zones to the record block grant and £1.5 billion for the 12 city and region growth deals, we deliver for Scotland.

SNP MPs have been disengaged from Westminster for years. Does the Secretary of State agree that it is a disgrace that its deputy leader has said that its MPs will not engage should the party win seats at the next general election? Does he also agree that Members elected to this House should turn up and do their job?

Three years ago, on 16 March 2021, we had a debate in this House on precisely the subject of this question. At the time, I was concerned that Nicola Sturgeon’s Government were covering up interference in the complaints process against the First Minister. Since then, in defiance of the Information Commissioner and of a court order, they have continued to cover up. Will the Cabinet Secretary look at whether the ministerial code and the civil service code have been broken?

My right hon. Friend should write to the Cabinet Secretary and ask him to do that very thing.

Marine Energy Sector Support

8. What recent discussions he has had with Cabinet colleagues on the adequacy of support for the marine energy sector in Scotland. [R] (901753)

The Government are firmly committed to supporting Scotland’s marine energy sector to grow. Around 80% of tidal stream contracts awarded through contracts for difference in the last two rounds will be deployed in Scotland. In addition, Horizon Europe selected two Scottish-based UK tidal stream developers to deliver projects in Orkney. They will lead construction on two £17 million projects, funded by the UK Government’s financial guarantee.

The Minister knows that successive Energy Ministers have hugely helped the development of the marine energy sector in Scotland, as elsewhere in the United Kingdom. Does my hon. Friend agree that there is an opportunity in the next round of the renewables auction to allow for wave technologies alongside tidal stream technologies? Will he encourage the Scottish Government to speed up approvals of sites to get great green energy projects started as soon as possible in Scotland, as elsewhere?

I am grateful for that important question. The Government are undertaking analysis of the technology pipeline available for contracts for difference auction round 6 against our legal obligation to ensure that the auction round is competitive. We are considering the appropriate parameters for all technologies, including tidal stream and wave energy. The final parameters will be published in the budget notice this month, ahead of the auction round opening.

The Seastar tidal farm off the coast of Orkney is set to be the largest tidal energy farm anywhere in the world, and it was supported by EU funding through the European Marine Energy Centre. This comes after Edinburgh University’s report found that the UK Government could save hundreds of millions of pounds by bringing forward the development of tidal by years, if it worked more closely with its EU partners. It is clear that the EU’s role in this in Europe and around Scotland is very important, so if Scotland is better together with anyone, is it not better together with the EU and its investment in tidal?

What a load of nonsense. Scotland is much better served by being part of the United Kingdom, and we will continue to support all renewable energy sectors, including tidal.

Cross-border NHS Provision: Waiting Times

10. Whether he has had recent discussions with (a) Cabinet colleagues and (b) the Scottish Government on waiting times for cross-border NHS provision. (901755)

The Government recognise the invaluable job that all NHS workers do; I see that every day of the week in my constituency in the Scottish Borders. That is why the Secretary of State for Health and Social Care has written to the Scottish Government about working together to reduce patient waiting times. We continue to be open to exploring that further.

I have a lady constituent who suffers from a rare and dangerous condition called subglottic stenosis. Only one clinic has the expertise to treat the condition, and it is in London, yet our local health board is refusing to refer her. It says that it can offer another treatment, but it is thought to be less safe and possibly not very effective. What steps are the Government taking to ensure that patients, regardless of which side of the border they live on, get the best possible treatment?

I am regularly reminded, particularly as an MP for the Borders, of the need for healthcare to benefit people on either side of the border, particularly through cross-border working with the NHS. Local people in the Borders often get treatment faster and more easily because of that. Sadly, the hon. Member has highlighted a real problem with Scotland’s NHS, thanks to the mismanagement by the SNP Government in Edinburgh, particularly in rural health services. He has identified a very distressing case for his constituent and I am very happy to write to the Scottish Government, along with him, to raise the case with them.

Food Exports

Scotland Office Ministers have banged the drum tirelessly to promote the Scottish food and drink industry overseas, including on trade missions in Europe, India, the United States of America and Vietnam. In Vietnam, sales of Scotch whisky have increased fourfold and are still growing. I was delighted to discuss what more can be done to improve trade links and market access with the Vietnamese Government during my recent visit.

Scotland’s farming and fish sector produces some of the finest produce in the world. Will the Secretary of State do all he can to promote the sale of Scottish smoked salmon abroad as a premium product known the world over?

I think I heard “smoked salmon”, but this is not just about smoked salmon. The most recent figures show that Scotland’s world-leading food and drink sector accounted for 29% of all UK food and drink exports. To help the sector to continue to flourish, the Government have secured trade agreements with 71 non-EU countries and the EU. Total UK trade with those partners is worth £808 billion.

Some of Scotland’s food export companies have been prevented from trading with Northern Ireland. The InterTrade UK body has been set up as a result of discussions that have taken place. What are the Minister and his Department doing to ensure that the companies that have stopped trading with Northern Ireland are encouraged to start doing so again?

In the UK Command Paper, we said that we are setting up the East-West Council, which will work to bring about the solutions.

Departure from the EU: Impact on Scotland

The UK Government are working tirelessly to maximise opportunities following our departure from the European Union. Scotland continues to punch above its weight, both in exports of goods and services and in foreign direct investment, and I am delighted to be able to say that trade is now well above pre-Brexit levels.

Scotland has been hammered by Westminster’s imposition of a hard Brexit, with the Scottish salmon industry alone suffering an additional £12 million of Brexit red tape costs. Across every sector of Scotland’s economy, Brexit has added red tape costs, limited access to vital workers and limited markets. Is the Secretary of State proud of his legacy, which includes a deliberate and avoidable undermining of Scotland’s economy?

As the right hon. Gentleman will appreciate, our departure from the EU has allowed us to forge new relationships. Consequently, Scotland’s exports are performing well—they are up by 13%.

Will my right hon. Friend join me in welcoming the completion of fisheries negotiations with the Faroe Islands, which have resulted in 2,200 tonnes of fishing quota, mostly for the Scottish fleet? Does he agree that since the UK became an independent coastal state, the Scottish fleet and those who negotiate on its behalf, including SNP Scottish Government Ministers and their officials, have a far stronger voice in these annual negotiations than if the SNP had its way and we went back into the EU common fisheries policy?

My hon. Friend is a great champion of the fishing industry, and I completely agree with him.

We now come to Prime Minister’s questions. We are joined today in the Gallery by the Speaker of the Supreme Council of the Kyrgyz Republic.