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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 7 June 2025
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Displaying 3368 contributions

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Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

I think that the debt interest in the UK is now about six times Scotland’s annual expenditure on the national health service, which puts things in some kind of perspective.

You have touched on health and social care spending in relation to departmental expenditure limits, saying that it is

“reaching 45 per cent of total resource DEL”

compared with

“25 per cent at the turn of the century.”

That is clearly on an upward trajectory. Given the fiscal position that we are in, how sustainable do you believe that to be?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Carl, you said that there are options other than raising tax, which I find intriguing. What are those other options?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Yes, although it is quite easy to predict what the natural growth in the population of people born in the UK is, because you get about 16 to 18 years’ lead time on that.

One of the issues of concern in your report is that almost 650,000 more adults were outside the labour market in the autumn of 2022 than at the start of 2020. You go on to mention the £7 billion that is being spent each year on health-related benefits and the resulting £9 billion that is lost in foregone tax revenue. That is at the same time as unemployment is set to increase by around 85,000 more than was predicted. What is the impact on growth of those figures?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Legal migration to the United Kingdom was roughly 750,000, net, last year, which was a record number. I would imagine that most of those people will be of working age. Has that not increased growth in the UK economy? What has been the impact on that?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

But we do not know what the contribution to the economy is, generally speaking.

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

Would it not also mean that billions of pounds would not be circulating in the economy? Students tend to rent accommodation, go to cafes, buy food at Tesco, spend money on clothes and so on, and go around the country to visit castles and lochs and God knows what else, so surely there would be quite a significant overall impact.

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

What is the impact on public service spending as a result of that?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

So, what are we talking about here? You have discussed how

“the spending of unprotected departments”—

that is, UK departments—

“would need to fall by 2.3% a year in real terms from 2025-26, increasing to 4.1% a year, should the UK Government continue with its ambition to increase defence spending to 2.5% of GDP and return overseas development assistance to its 0.7% of gross national income target.”

What are we talking about in ballpark figures at today’s prices?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

I understand that the expensing measure amounts to around £3 billion a year, but the increase in corporation tax from 19 to 25 per cent is worth about £18 billion. Is that right?

Finance and Public Administration Committee

Budget Scrutiny 2024-25 (United Kingdom Context)

Meeting date: 12 December 2023

Kenneth Gibson

We talked about the GDP deflator. John Mason asked questions about that, and Professor Mills gave us a detailed answer. An issue for me is the unrealistic nature of the GDP deflator, in how it is likely to impact on capital. Over the next four years, it is predicted that the impact of the GDP deflator on Scotland’s borrowing would allow the ceiling to go from £3 billion to £3.165 billion, which is a measly cumulative 5.5 per cent over four years. That is now baked into the fiscal framework. Is it in any way realistic?