Dundee could gain up to £32 million in investment if the Scottish Government’s call for a £1bn package of reflationary measures to support economic activity in Scotland is successful.
SNP politicians in Dundee have supported the Scottish First Minister’s call to bring forward nearly £1bn of investment from a variety of sources, as well as the speeding up housing investment and bringing forward money from the European Structural Fund.
Dundee’s SNP MSPs Shona Robison and Joe FitzPatrick have welcomed the move to protect jobs, investment and household incomes in the wake of the global financial crisis.
Shona Robison, Dundee East MSP, said: “The SNP Government’s priority is protecting Scotland’s economy and this package of measures will accelerate investment and bring forward spending programmes from within our fixed budget which will help keep the economy moving.
“The package could mean an additional investment of £15.83 million for Dundee East and £16.46 million for Dundee West on a pro-rata basis – which would be very welcome indeed.”
Welcoming the package of measures, Dundee West MSP Joe FitzPatrick said: “The Scottish Government has worked hard to come up with a variety of ways in which the Scottish economy can be strengthened in these difficult times and it is important to look at all possible measures that will help people to cope with the financial pressures.”
Referring to the global crisis, Dundee Councillor Jim Barrie said: “Small independent countries can move quickly and decisively to protect and stimulate their economies and restore confidence. Although Scotland is not Independent, the devolved Government under SNP administration has been able to identify a considerable number of measures that could be taken within the Scottish Government’s devolved responsibilities to give maximum protection to the economy.”
Notes
First Minister Alex Salmond convened the special Economic Cabinet which considered additional options to bring forward investment and support economic activity in Scotland. Additional Resources sought are:* Fossil Fuel Levy surplus, in excess of £120m. This is a Scottish fund currently held by Ofgem for investment in microrenewables, but which accessing would result in the Scottish Government’s budget being reduced by an equivalent amount – unless Treasury restrictions are relaxed.
* The Scottish Government’s £42m underspend, held at
Westminster and which currently can only be sought during the next spending period from 2011.* The Council Tax Benefit mechanism, which has cost
Scotland some £476m since its suspension in August 2004. The mechanism was introduced at the start of devolution because the Treasury feared that devolved administrations’ policies on council tax and rents would cause increased calls on the DWP reserved budget. In the event, instead of resulting in a clawback as the Treasury expected, council tax and rents in Scotland (and Wales) increased at a lower rate than in England, resulting in additional funding being paid to the devolved authorities. It was agreed with the Treasury Chief Secretary in July 2005 that Scotland would receive a one-off payment of £57m. It is estimated that the loss since 2004-05 has been running at some £100m a year.* London Olympics regeneration spending, which should generate £33m of spending per annum over the five years to 2012-13 for
Scotland under the Barnett Formula. The spending is on areas such as regeneration and transport, and there is a strong case argued by all three devolved administrations that this should be ‘Barnetted’ in the normal way.* The Carter Review of Prisons Spending, which should be worth £120m for
Scotland. As a result of the Carter Review of prisons and the overcrowding problem, £1.2 billion of spending on the prison estate in England and Wales was funded out of the Reserve – in the period after the Comprehensive Spending Review. Scotland faces similar overcrowding, and had the funding been allocated in the usual way from the normal budget headings, full Barnett consequentials would have been generated for Scotland.* Police and Fire Fighter pension commutation costs, which should generate some £40m of Barnett consequentials for
Scotland over the Spending Review period (2008-11) as a result of the pension costs being paid south of the Border. This week, the Scottish Government and Scottish local government announced that the costs would be met on a shared basis from Scotland’s fixed budget, although we will continue to press the case for Barnett money.
TOTAL: £963m
