Economy facing ‘difficult years’, admits Sturgeon
NICOLA Sturgeon has warned that Scotland is facing years of economic gloom.
The First Minister’s warning came as her Economy Secretary demanded more cash from UK ministers to tackle the problem – even though control of the economy is reserved to Holyrood.
It comes ahead of the publication of figures tomorrow which will show whether or not Scotland has officially plunged into recession.
In a newspaper column published yesterday, Miss Sturgeon said ‘the next few years are going to be difficult for our economy’ – and blamed Brexit, despite the rest of the UK’s economy performing better than Scotland’s.
But Scottish Conservatives economy spokesman Dean Lockhart said: ‘It’s extremely rich of Nicola Sturgeon to moan about challenges facing the economy when she has the powers to address it.
‘Scotland stands on the brink of recession while the rest of the UK powers on. That failing clearly lies at the SNP’s door, yet the Nationalists’ only solution is to blame Brexit and demand more money from Westminster.
‘Instead, the Scottish Government should be focused on pro-business measures and keeping taxes low for hard workers and companies.
‘Ministers should also listen to those leading economists who urge them to reverse their policy of making Scotland the highest taxed part of the UK.’
Official figures will show if the economy contracted for a second time in the three months to the end of March – which would mean entering recession for the first time since 2012.
In the final three months of 2016, Scottish gross domestic product (GDP) reduced by 0.2 per cent, compared to 0.7 per cent growth across the UK.
Over the whole of last year, British GDP growth of 1.8 per cent was more than four times faster than the 0.4 per cent growth in Scotland.
Miss Sturgeon said: ‘The next few years are going to be difficult for our economy as we deal with the impact of the UK’s plans to leave the EU but I am determined we will do everything in our power to keep business growing.’
When it set its Budget earlier this year, the Scottish Government opted to freeze the threshold for paying the higher 40p rate of income tax at £43,000, while it increased to £45,000 across the UK.
The decision means that all higher rate taxpayers based in Scotland will pay £400 more this year than those living south of the Border.
Business leaders have warned the decision to force higher taxes on Scots – as well as Miss Sturgeon’s failure to take the threat of a second independence referendum off the table – will cause further damage to the economy.
At the weekend, Highland Spring chief executive Les Montgomery said businesses are ‘fed up’ with talk of an independence referendum. He said: ‘Independence isn’t the job the Scottish Government is supposed to be doing.’
Economy Secretary Keith Brown yesterday met UK ministers to highlight concerns about Scotland missing out on £1billion funding provided to Northern Ireland as part of the Tories’ deal with the DUP.
In a BBC Radio Scotland interview, he conceded that Scotland faces economic challenges – and said more money is needed from the UK Government to address them.
However, all controls over the economy – as well as crucial economic levers such as income tax – are devolved to Scotland.
Asked why he wasn’t talking to UK ministers about why Scotland’s economy lags behind the UK’s and is on the brink of recession, he said: ‘If we were to receive this money there is more we can do in terms of the Scottish economy.
‘And the Conservatives hold most of the main levers in terms of the Scottish economy. Their conduct of the Scottish economy has involved, for example, inflation now at 2.9 per cent, a collapsing pound, £100billion of new debt.’
Mr Brown added: ‘The UK Government’s economic policies are undermining growth in Scotland.’
‘Failing lies at the SNP’s door’