UK Government's £375m for Scottish lockdown is 'not new', claims Kate Forbes
The Scottish Finance Secretary has claimed the UK Government's £375 million of support for the Scottish lockdown is “not new”.
Chancellor Rishi Sunak laid out plans for an extra £4.6 billion in business support in England after a lockdown was announced this week.
However, after the Treasury claimed this would see the Scottish Government handed an additional £375m, Kate Forbes accused Mr Sunak of claiming old money was new.
She said: “We are both surprised and disappointed that the UK Government’s announcement of additional funding for businesses in England will not – despite the initial indications – generate further new funding for the Scottish Government or other devolved administrations.
“This is a blow to Scottish businesses, whose expectations had been raised by the announcement, and I will be writing to the Chancellor to raise the issue.
“We fully understand that while the tight new restrictions now in force are necessary to slow spread of the virus, they represent another blow for businesses.
“That is why we have allocated £570m since October to helping businesses and this sum will rise due to the number of new businesses eligible for support under the latest lockdown restrictions.”
The Scottish Government say the funding is part of cash already guaranteed by the UK Government to the devolved administrations, expected to total £8.6 billion for Scotland in this financial year, which had already been announced.
It follows Nicola Sturgeon’s announcement of a national lockdown, meaning Scots can now only leave their home or garden for an essential purpose.
On Twitter, Economy Secretary Fiona Hyslop said: “In the morning the UK Gov declare new funding will come to Scotland and by lunchtime the Treasury have told the Scottish Government there is nothing new for Scottish businesses.
“They can’t treat Scotland’s businesses like this.”
A press release had claimed the cash was “on top of the increased funding, which has already been guaranteed by the UK Government”, despite a post on its own website saying it would “contribute to the funding which has already been guaranteed by the UK Government”.
Scottish Labour’s finance spokeswoman Jackie Baillie also weighed in on the row, labelling the change an “an embarrassing U-turn”.
She said: “It’s time for the UK Government to honour its original statement and provide the additional funds for devolved nations and regions on top of the UK-wide funding package.”
Scottish Tory leader Douglas Ross had earlier welcomed the support and urged the Scottish Government to get it out as soon as possible.
He tweeted: "Very welcome news for Scotland – an extra £375m to support businesses affected by lockdown measures.
"The SNP must get this extra funding out the door immediately. For many businesses, their survival depends on it."
The support comes on top of £8.2bn received from the UK Treasury since the crisis began.
Andrew McRae, Scotland policy chair for the Federation of Small Businesses, had also welcomed the investment.
He said: “This new cash injection could help a share of Scottish firms survive until the vaccine is rolled out. The Scottish Government must ensure this new funding reaches businesses before the end of January.
“The new £375m should be split between cash grants for smaller property based firms, and extra help for non-premises based operators that have had little or no help so far. But before any of this can happen, councils and government need to break the administrative logjam preventing money reaching businesses.
“Independent firms and the self-employed continue to make huge sacrifices. These operators can’t be left high and dry because of poor government systems.”
The Scottish Retail Consortium called for the funding to go straight to hard-pressed retail.
Director David Lonsdale said: “It’s vital a fair portion of these newly devolved funds are swiftly used to prop up so-called non-essential retailers here in Scotland whose businesses are balanced on a knife edge whilst prevented from opening.”
Mr Sunak announced the new financial package earlier on Tuesday and explained it would give businesses in retail, hospitality and leisure sectors handed one-off grants worth up to £9,000.
Given on a per-property basis, the support is expected to help more than 600,000 businesses, worth £4bn across the UK.
He said: “The new strain of the virus presents us all with a huge challenge – and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.
“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the spring.
“This will help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”
A further £594m is also being made available for local authorities and the devolved administrations to support businesses not eligible for the grants that might be affected by the restrictions.
Scottish Secretary Alister Jack also defended the funding, but did not say if it was new.
He said: “As throughout this crisis, the UK Government’s priority remains to keep people safe and support jobs in all parts of the UK.
“The Chancellor has set out additional support for businesses in England. We hope the Scottish Government uses some of the £8.6bn we have provided to support struggling Scottish businesses similarly.
"This is on top of the direct UK Government support for people and businesses in Scotland, including our furlough scheme now extended to the end of April, self-employed support, business loans and procuring and paying for millions of doses of the Pfizer and Oxford vaccines.
“The strength of the Union and support offered by the UK Treasury has never been more important.”
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