SCOTLAND CRASHING TO WORST SLUMP IN THE WORLD
SNP adviser’s warning as Sturgeon faces fresh calls to get country back to work
SCOTLAND is facing the worst economic crash of any developed nation in the world, a top SNP adviser has warned. Andrew wilson believes the future looks ‘bleak’ for many families as the coronavirus pandemic creates the worst collapse ever recorded.
scotland’s economy slumped by nearly a quarter in the first two months of the crisis, figures show. This has sparked fears that hundreds of thousands of jobs will be at risk, while businesses across the country are on the brink of closure.
experts believe the downturn will produce unprecedented financial turmoil.
Mr wilson, the snP’s top economic adviser, said: ‘what’s clear to me is the UK is set to be
the worst-performing economy in the developed world, and Scotland is probably going to be a bit worse because of the nature of our sectors and how the virus has behaved north of the Border.
‘This is a long haul back. The prospects are that we need a monumental effort – politicians and governments – to get the measures we need in place to rescue businesses, because the outlook for people, for families, is bleak.’
Nicola Sturgeon is under pressure to get the economy moving when she announces the next steps out of lockdown today.
Mr Wilson, a former Nationalist MSP who wrote the party’s sustainable growth commission report on the economic case for independence, also urged the First Minister to scrap the two-metre social distancing rule.
It follows claims this will lead to mass job losses across the hospitality sector and make it impossible for the majority of bars and restaurants to reopen.
Speaking on BBC Good Morning Scotland, he said: ‘Without those restrictions on social distancing being lifted in due course, businesses will fail on a grand scale.’
Asked if Scotland was opening up too slowly for companies which not survive the coming weeks, Mr Wilson said: ‘The short answer is yes for those businesses, but if you’re the First Minister you’re having to weigh up the whole economy and the whole society.
‘Her view is that if you open up too quick then the pain for those businesses could be deeper and longer in due course if the virus gets out of control. It’s a tough balancing act.’
Total economic output has collapsed at the fastest rate ever recorded in Scotland.
Unemployment has soared by 30,000, while nearly 800,000 other jobs are being propped up by UK Government support schemes.
Monthly figures, published for the first time by the Scottish Government yesterday to show the impact of coronavirus, reveal that GDP plunged by 5 per cent in March and by a further 18.9 per cent in April.
The April figure was the largest monthly fall ever recorded in Scotland, and is marginally lower than the 20.4 per cent decline recorded across the UK as a whole.
Scotland’s tourism sector has been hit harder than any other industry, with an 85 per cent slump in accommodation and food services over March and April.
Retail and wholesale saw a 37 per cent decline as non-essential shops had to shut their doors. Other hard-hit industries included construction, where output fell by 46 per cent over the two months, while the production sector plunged by 23.4 per cent.
Separate data also published yesterday showed GDP slumped by 2.5 per cent in the first quarter of the year – the biggest quarterly decline since records began and higher than the 2 per cent fall across the whole of the UK.
Mairi Spowage, of the Fraser of Allander Institute, said: ‘These are completely unprecedented figures, but we should remember these
‘The outlook for families is bleak’ ‘It is a tough balancing act’
were completely expected given the measures that have been taken to protect public health.’
But she added: ‘We are expecting to see significant rises in the unemployment rate and business insolvencies as businesses find they cannot operate without schemes like the job retention scheme, and given the lower capacity they may have to earn income due to physical distancing measures.’
Scottish Secretary Alister Jack said: ‘Now the Scottish “R value” is holding below one, we must start looking at how to open our econmay omy safely. People need to get back carefully to a more normal way of life, and the Scottish Government should keep an open mind about the measures needed to get Scotland moving again.’
Miss Sturgeon said: ‘At every level and in every way, there is a real commitment to do all that we can to support the economy as it recovers from the unprecedented challenge that it faces.’ Economy Secretary Fiona Hyslop added: ‘It is essential that the Scottish parliament is granted the additional powers it needs to properly manage the response to the crisis as we move towards recovery.
‘It is also the case that the last thing our businesses need is further economic turmoil as a result of a no-deal Brexit.’