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Politics / Positive step forward or ‘out of touch’? Mixed views on chancellor statement

ORKNEY and Shetland MP Alistair Carmichael has accused the Conservatives of “incompetence and chaos” following tax hikes and cuts to public spending.

Chancellor Jeremy Hunt delivered an autumn statement this morning (Thursday) in a bid to “restore stability to the economy, protect high-quality public services and build long-term prosperity for the United Kingdom”.

The UK Government points to measures like extra £26 billion of support for the cost of living and an increase in the oil and gas windfall tax.

But Carmichael said it is “less of a cost-of-living budget than a ‘cost of Conservative chaos’ budget”.

Isles MP Alistair Carmichael.

“Everyone else is being forced to pay the price for the government’s incompetence over recent months,” the Liberal Democrat said.

“It is not good enough for the Chancellor to act as though the mess created by his colleagues has nothing to do with him.”

Among the measures relevant to island communities was doubling the winter energy support payment for households using heating oil from £100 to £200.

However, Hunt stopped short of imposing a price cap on heating oil as suggested by Carmichael.

The chancellor also confirmed that a windfall tax on the profits of oil and gas firms will increase by ten per cent to 35 per cent, and be extended through to 2028.

A temporary 45 per cent tax on companies that generate electricity will be applied from January.

Meanwhile the national minimum/living wage for people aged 23 and over will increase by nearly 10 per cent to £10.42 an hour from April.

The statement included tens of billions of tax rises and spending cuts as the UK enters a recession.

For example income tax, personal allowance and higher rate thresholds will be frozen for a further two years until April 2028.

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The state pension, benefits and tax credits will rise in line with inflation and additional cost of living payments were announced for the most vulnerable.

But the energy price guarantee which will ‘cap’ average UK energy bills at £2,500, will only stay in place until April – at which point this cap will rise to £3,000.

These figures relate to the average UK household usage, meaning that if you use more than you will pay more.

Highlands and Islands Conservative Jamie Halcro Johnston.

Highlands and Islands Conservative MSP Jamie Halcro Johnston said there were “positive announcements in key issues” that impact his region.

“There is a continued commitment to the levelling-up agenda, with funding to be protected,” he said.

“I have lobbied the prime minister on support for those in off-grid homes, often reliant on oil or LPG for their heating, so I am pleased to see that the Alternative Fuel Payments will be doubled for domestic customers – with additional support for off-grid businesses.

“A £13 billion package of support for business rates payers in England will bring Barnett consequentials for the Scottish Government and it is vital that this money is used to back businesses here in Scotland and protect jobs.

“The chancellor has also increased the levy on profits of energy producers, ensuring that there is recognition that they must play their part during this period.”

While the Tory MSP believed the autumn statement was a “positive step”, Carmichael said it showed an “out of touch government”.

“I am glad at least that the chancellor has committed to maintaining the triple lock for pensioners and an inflation-matching increase on benefits but that is really the least we should expect for the most vulnerable right now,” he added.

“We need a fair deal, including support for people unable to afford skyrocketing mortgage bills and rents and energy costs.

“This could be paid for by reversing tax cuts for banks and a proper windfall tax, instead of imposing years of stealth taxes on ordinary families.”

Deputy Scottish first minster John Swinney said: “Inflation is eating away at the Scottish budget, and due to the lack of additional funding in 2022-23 and the financial restrictions of devolution, we have had no choice but to make savings of more than £1 billion.

“The constant U-turns on tax by the UK Government have made planning for the Scottish Budget more challenging this year. We will take time to consider the implications for Scotland before setting out our own plans as part of the normal budget process.”

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