A ‘missed opportunity’ for meaningful action

Deputy First Minister John Swinney has described the UK Government’s Spring Budget statement as “another missed opportunity” to help households, businesses and public services through the cost of living crisis.

He said Chancellor of the Exchequer Jeremy Hunt had failed to deploy the full range of powers available to him to mitigate the impact of soaring energy prices and high inflation.

While welcoming a number of individual measures such as the extension of the energy price guarantee – and with a typical household’s monthly energy bills set to rise by almost half from March to April – Mr Swinney said substantive actions such as restoring the Universal Credit uplift were notably absent.

He also called for the UK Government to inflation-proof the Scottish Government’s budget so it can better co-ordinate spending across Scotland.

Mr Swinney said:

“This UK Budget is another missed opportunity to take meaningful action to lift families out of poverty, invest in our public services and help businesses so that our economy can grow.

“Instead, the UK Government should have taken more substantive action to increase the Scottish Government’s budget so we can better align spending and deliver for people and organisations right across Scotland.

“While reversal of the planned increase in the energy price guarantee is welcome, with the end of the energy bills support payments, typical household monthly bills will still rise by more than half from March to April, at a time when wholesale energy costs are falling.

“Rising interest rates combined with reduced support means some people are expected to experience a larger fall in living standards this coming year than they have over the last 12 months.

“An uplift on Universal Credit and extending this to legacy benefits would have made a meaningful difference to households struggling to make ends meet.

“The limited additional money for the Scottish Government’s Budget is welcome but will not go far enough and in the long-term our capital funding will fall in real-terms. Without extra funding, we will have to find money from within the Scottish Budget to invest in public services, provide fair pay rises and help people with the cost of living.

“The Scottish Government is doing what it can with its limited powers to ensure people receive the help they need, but the UK Government’s could have done far more to ease the burden affecting so many, demonstrating yet again why Scotland needs the powers of independence.”

Background

In a letter to the Chancellor ahead of the Spring Budget, the Deputy First Minister had urged specific measures to help households, invest in public services and support the economy to grow - including reinstating the uplift to Universal Credit and providing tax incentives for businesses.

Ahead of the UK Budget, the Resolution Foundation estimated that typical incomes among non-pensioner households will fall by 4% in 2023-24 in real terms, compared to 3% in 2022-23.