POLITICIANS in Shetland have criticised UK chancellor Rishi Sunak for unveiling a budget which they say fails to address key challenges including poverty, climate change and mitigating the impact of Covid-19 and Brexit.
Headline measures included in the budget included confirmation that the furlough scheme will continue over the summer, while a £20 a week uplift in universal credit have been extended until September.
Corporation tax on profits above £50,000 will increase to 25 per cent in 2023, while tax allowances have been frozen meaning that workers will ultimately pay more income tax.
The UK Government has injected hundreds of billions to help the economy cope with the impact of Covid-19.
But the Office for Budget Responsibility (OBR) issued a damning statement on Wednesday highlighting that one in five Britons contracted the virus, resulting in the fourth highest mortality rate in the world, while a 9.9 per cent decline in GDP over 2020 was the worst among G7 economies.
Northern Isles MP Alistair Carmichael welcomed the extension of furlough but described the overall package as a “standstill” budget.
Tom Wills, the SNP’s Shetland candidate for May’s Scottish Parliament election, said the budget was most notable for what it did not contain – particularly on tackling climate change, reducing poverty and mitigating the damage caused by Brexit.
“I want to see a green new deal. If we are in a climate emergency we need to start acting like it, but we’ve heard nothing from Rishi Sunak on reducing household carbon emissions, nothing on charging points or incentives to encourage uptake of electric cars,” said Wills, who has over a decade of experience in the renewables industry.
“This is our opportunity, as we emerge from Covid-19, to restructure the economy, because if we don’t we’re just going to sink back into the same old ways. We need to be bolder and more ambitious.
“The idea that we don’t have the money to do this is nonsense. If we don’t stimulate the economy and tackle climate change, the long term costs will be so much greater.”
Wills added he was disappointed that the £20-a-week uplift in universal credit has only been extended temporarily for six months and has called again for the increase to be made permanent.
He also wants to see greater support for Shetland’s seafood sector as it grapples with greater bureaucracy and trading restrictions caused by the UK’s departure from the EU in January.
Carmichael said there had been “a lot of hot air and warm words” in the budget but Sunak had “clearly put off the hard decisions for later in the year”.
“If and when tax rises come to repair the damage to government finances, they need to be targeted to those at the top – to big businesses rather than small ones – so that those who are most able will pay their fair share,” the Liberal Democrat MP said.
He welcomed the continuation of a VAT cut to 5 per cent for hospitality and tourism “for the time being” but said he intended to raise with ministers the possibility of a longer term to VAT on tourism.
“This could be a chance to give solid footing for the sector in building back in the years to come,” he said.
Carmichael also welcomed the partial expansion of support for self-employed people “though we should keep in mind that this leaves millions still falling through the cracks” and after a year of the pandemic there is “little excuse left for their inaction”.
He added that Sunak had “presented a lot of half measures” but “you cannot ‘half support’ people in need. Either you want to support people and support recovery fully, or you do not. The Chancellor is again leaving too many people out.”
The Conservatives’ Highlands and Islands list MSP Jamie Halcro-Johnston, however, claimed the budget was “great news for jobs and businesses” in the region.
He highlighted the extension of furlough, alongside a freeze in alcohol duty, and said the opportunities offered by the budget – including £1.2 billion in extra funding – “must not be squandered by lethargic and unimaginative SNP ministers”.
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