A key aim of the Smith Commission was to improve accountability and make Scotland’s politicians responsible for the money that they spent. Unfortunately rather than helping to deliver this aim, the current proposals for VAT assignment risk undermining that principle.
‘In short, ‘ending austerity’ is possible with significant but not unrealistic spending increases. What makes a promise to end austerity politically difficult is that it cannot be achieved without tax rises if the government is to keep to its fiscal rules and commitments.’
‘It is important to remember that GERS takes the current constitutional settlement as given. If the very purpose of independence is to take different choices about the type of economy and society that we live in, then a set of accounts based upon the current constitutional settlement and policy priorities will tell us little about the long-term finances of an independent Scotland.’
‘Two years on from the referendum outcome, simply kicking the can down the road – or sleep walking into a no-deal outcome – is simply no longer a credible economic strategy to adopt:’ FAI on the risks to the Scottish economic recovery
‘With that in mind, if this optimism translates into actual activity and higher pay for workers, then the sector should help boost economic growth in Scotland as a whole during 2018.’
‘Despite significant uncertainty for renewables in recent years, the sector continues to outperform expectations and go from strength-to-strength….it is clearly one part of the Scottish economy where success should be recognised.’
‘But whatever measure or comparison used, it is clear that the challenge to boost Scotland’s long-term rate of productivity shows no sign of disappearing. Back in 2007, the Scottish Government set a target to “rank in the top quartile for productivity amongst our key trading partners in the OECD by 2017”. It is clear that this target will be missed’.
‘Whilst there is clearly a negotiating advantage in the government holding back some monies as part of their tactics to get the Budget Bill through, one can see MSPs from now on assuming that £100 million is a useful ballpark for the amount the government may have ready to hand to push through a deal’.
‘… the challenge remains for Derek Mackay as to how best to balance his resource budget with major commitments like additional support for the NHS, more money for childcare and public sector pay uplifts all to be paid for.’
The upcoming budget debate is an important opportunity for policymakers from all sides to set out what they would do, yes on taxation, but also on expenditure and growth. The new income tax powers provide some measure of relief, but it’s far from the only game in town’.