The economy needs an £80 billion boost to help it out of crisis, Scotland’s finance secretary claimed.
Kate Forbes said the spending spree would finance a VAT cut and move tourism and hospitality to reduced rates. She also wants a 2p cut to employers’ National Insurance contributions to make it easier to hire staff.
The calls are in a new report to the UK Government, which controls most economic powers.
Forbes said: “We are emerging from the biggest economic shock of our lifetimes. It has hit the most vulnerable in our society disproportionately and presents challenges that the Scottish Government does not currently have the powers to meet.”
Forbes made the demands as Prime Minister Boris Johnson prepares for big spending in England.
The Scottish Government report, published today, builds on earlier work including calls for a jobs guarantee scheme. It calls for:
- A National Debt Plan for business and household budgets.
- Priority for economic spending instead of austerity.
- Major investment in low-carbon and other “green” infrastructure.
- More financial powers for Scotland.
Forbes said: “This report recommends bold, practical steps which would provide an immediate boost to our economy, protect existing jobs and deliver new ones. It tackles public debt, employment and proposes measures to further support business. Crucially, it avoids any return to austerity.
“Economic stimulus must be prioritised over deficit reduction until the recovery has fully taken hold.
“Germany has already adopted a similar-size stimulus package, representing four per cent of GDP, and the UK Government needs to be similarly positive, proactive and ambitious.”
Meanwhile, Johnson is preparing for a spending speech on Tuesday. Previewing his aims today, the Prime Minister highlighted a 10-year plan for schools and wider construction, which applies to England.
Labour leader Keir Starner wants an emergency UK Budget from the Chancellor next month, preparing for the end of wage protection and the prospect of mass unemployment.
