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| Wednesday, 17 April, 2002, 18:29 GMT 19:29 UK Mixed response to Budget plans ![]() Holding aloft the traditional red box Scotland is set to receive an extra �8.2bn for public services over the next five years under Gordon Brown's Budget. The figure was detailed by Scottish Secretary Helen Liddell following the Chancellor's speech in the House of Commons. She welcomed the measures which have received a mixed reception north of the border, with support from unions but criticism from business leaders and opposition politicians.
"It will provide an extra �2.7bn for public services in Scotland over the next three years - equivalent to �528 for every man, woman and child in Scotland - and a further �5.5bn in years four and five. "It encourages business and job creation and recognises the needs of the most vulnerable in our society by providing additional support for pensioners, families and the low paid." However, the Scottish National Party's Westminster leader, Alex Salmond MP, said Scots would be "paying more tax for less". He said the 1% rise in National Insurance contributions for employers, employees and the self-employed to pay for a large cash injection into the NHS was "a total u-turn" by Labour.
"Gordon Brown has moved onto the SNP's ground on tax and spending," he said. "But New Labour's chronic under-investment over their five years in power - after nearly two decades of Tory government - has done enormous damage to our health and other public services." And he said that health spending would rise by 7.5% rise in real terms south of the border over the next five years compared to 6.5% in Scotland - a "Barnett squeeze" of �1bn. The Budget also included a freeze on duty on beer, spirits and wine. Mrs Liddell said this was "a welcome boost" for Scotland's whisky industry, which commands annual sales of some �2.6bn. 'Burden on business' However, John Downie, the Scottish Secretary of the Federation of Small Businesses, said it was not a pro-enterprise budget. "This budget gives little and takes a lot from business," he said. "The 1% increase in employers' National Insurance contributions is going to cost Scottish businesses �350m. "That's a tax on employers and it is a burden on businesses."
Scottish TUC deputy general secretary Grahame Smith hailed Mr Brown's commitment to the principles of the health service. "We also welcome his commitment to substantially increase resources to the health service which will benefit service users and the workforce. "There was also good news on support for pensioners and families and we particularly welcome his announcement of support for the manufacturing industry through the new research and development tax credit. "The chancellor has made a good start on the health service but if we want to properly modernise our public services we need to see the same commitment to investment." The Shadow Scottish Secretary, Jacqui Lait MP, said the Budget contained "more taxes, with no change and no difference.
"What is needed is modernisation, not more tax." Liberal Democrat MP John Thurso said the increase in health service funding reflected his party's policy. "It is for my colleagues in the Scottish Parliament to decide on how this money should be spent in Scotland," he said. "However, it is a pity that the chancellor, even when he is doing the right thing, cannot resist being over-complicated about it." Mr Brown also unveiled a new 10% supplementary charge on North Sea oil profits, while also raising first year capital allowances to 100%. Undermine confidence The UK offshore oil and gas industry welcomed this move on capital allowances. However, it said it was "disappointed" at the decision to introduce the charge on profits. The UK Offshore Operators Association fears this could undermine investor confidence and affect growth in exploration. "There seems to have been an element of give and take," said a spokeswoman. |
Brown's big gamble
See also: 17 Apr 02 | Politics 17 Apr 02 | Politics 07 Nov 01 | Scotland Internet links: The BBC is not responsible for the content of external internet sites Top Scotland stories now: Links to more Scotland stories are at the foot of the page. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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