Sluggish economy may trigger £600m bailout
SCOTLAND is on the brink of an ‘economic shock’ that would trigger emergency borrowing powers.
Holyrood’s funding agreement with Westminster allows for a cash injection of up to £600million a year to boost the economy if Scotland’s growth consistently trails behind the UK.
It is triggered if total gross domestic product (GDP) growth is less than 1 per cent over four quarters and is one percentage point lower than the UK.
Last year, Scotland’s GDP growth was only 0.75 per cent, compared to 1.78 per cent for the UK. The extra funding will be released if figures in July show the trend continued in the final quarter of the 2017-18 financial year.
Scottish Conservative finance spokesman Murdo Fraser said: ‘This clearly highlights the scale of the economic crisis Scotland is currently in.
‘The criteria for a Scotland-specific economic shock has been met. There is no room for excuses from Nicola Sturgeon – this is a shock made in Bute House.
‘The SNP has failed to energise the economy, preferring to write strategies and create quangos rather than deal with the systemic issues Scotland faces.’
A spokesman for Economy Secretary Keith Brown said: ‘The Tories’ claims are wrong – the criteria for Scotland-specific economic shock borrowing have not been met.
‘In any case, it is the Tories’ obsession with an extreme Brexit combined with their unnecessary austerity which is causing real harm to both the Scottish and UK economies.
‘Rather than blame the SNP for a mess of their own making, the Tories should get their own house in order, end their Brexit uncertainty and commit to keeping Scotland in the European single market and customs union.’