Covid: If Chancellor Rishi Sunak cuts economic support too soon, it would risk disaster at Scottish elections – John McLellan

The recent spat between the UK and Scottish governments, in which Cabinet Officer minister Michael Gove accused First Minister Nicola Sturgeon of trying to undermine Brexit negotiations, revealed the Scottish government received an extra £1.2bn in the 2019 budget, including money to help prepare for EU departure, and will receive a further £19.5m.

Chancellor Rishi Sunak delivers his autumn spending review in the Commons on Wednesday (Picture: PRU/AFP via Getty Images)

Last weekend, Chancellor Rishi Sunak pointed out that the Scottish government was receiving an additional £8.2bn of Covid emergency funding, with new measures pushing up the receipt from the £7.2bn extra identified by the Scottish Parliament Information Centre last month, and yesterday total emergency spending in Scotland hit £9.5bn.

With so much cash available so quickly, perhaps it’s understandable that, according to Strathclyde University’s Fraser of Allander Institute (FoAI), the Scottish government could still have around £1bn of unallocated funds to spend, but it does put Scottish government demands for more borrowing powers into a political rather than practical context.

There are no shortages of businesses, institutions and investment programmes desperate for cash, like the Edinburgh tram which threatens to empty Edinburgh Council’s reserves, so the Scottish Government challenge is to spend it wisely.

But such spending can’t go on and, as FoAI points out, when and how to stop will be hard to judge, especially in tourism and hospitality which, even with vaccines on the horizon, will not be off their knees before Summer.

With the Scottish elections in May, withdrawing employment support too soon could still be politically as well as economically disastrous.

John McLellan is a Conservative councillor for Craigentinny/Duddingston

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