Covid lockdown: Why is SNP government holding back billions of pounds that could help businesses now? – Ian Murray MP

Ever since the start of the pandemic, anxious businesses across the capital have been in touch with me about the emergency financial support on offer.

Thursday, 25th February 2021, 7:00 am
Streets devoid of customers and orders to close have left many businesses that are the lifeblood of Edinburgh's economy in desperate need of government help during the Covid lockdowns, says Ian Murray (Picture: Mark Scates/SNS Group)

Restaurants, pubs, hairdressers, taxi firms, soft-play centres etc, companies which are the lifeblood of our local economy, have been hardest hit by the crisis, jeopardising thousands of jobs.

Many were unsure what funding they could access, and simply wanted to know why they had to wait so long for help.

Right from the start, the SNP government offered less support to employers than in other parts of the UK, and there have been consistent delays in releasing grants.

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As far as those battling to save their livelihoods are concerned, the SNP government has been too slow to act and often delivered “pitiful” support.

Even now, some discretionary funds aimed at supporting businesses are already over-subscribed and are limiting payouts.

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So, a new report from Audit Scotland published this week will be met with anger by those who fear for their livelihoods.

It reveals the Scottish government has received a massive £9.7 billion of additional funding to tackle Covid in 2020/21 through the Barnett formula.

That’s money to support people and businesses in Scotland that comes from being part of the UK.

It is worth remembering that had Scotland been independent during this crisis, it would have been forced to borrow at higher rates than the UK due to using someone else’s currency through sterlingisation or having a new currency, eventually leading to deeper spending cuts, steeper tax rises and larger debt.

But, despite receiving £9.7bn for 20/21, the report shows that only £7bn worth of spending announcements have been allocated in response to the pandemic.

So that’s almost £3bn yet to be spent. What on earth is the SNP waiting for? People and businesses need the money now.

The report also reveals that SNP ministers have “decided to carry forward the most recent announcement of £1.1bn for 2020/21 to be spent in 2021/22”.

Conveniently, the next financial year starts just before the election.

It would be unforgivable if this money was being held back as part of electioneering. Every penny should be spent now to help our economy and public services.

Despite positive signs, thanks to the national vaccination programme, we are still months away from normality returning.

This week, people and businesses were desperate to hear some certainty from the First Minister about the route out of lockdown.

But there was widespread disappointment following her update, not least because there was no detail on additional support for businesses still closed.

As the UK budget approaches next week, we will also be calling on the UK government to extend the sectorial five per cent VAT rate, a smart furlough scheme and support for those excluded.

Additionally, there was no test-and-trace strategy in the exit plan, with the SNP still failing to learn the lessons that this is critical to protect communities post-vaccination.

Testing is critically important so that we can identify and contain any future outbreaks. There needs to be mass community testing (this was promised in January), otherwise we risk the return of restrictions.

We are at the start of a vital recovery period and millions are relying on those in charge to get it right.

Ian Murray is Labour MP for Edinburgh South

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