Press Releases Scotland's Economy

Autumn statement offers no protection to Scotland from hard Brexit

Written by Michelle Rodger

Business for Scotland response to the Autumn Statement

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Founder and CEO Gordon MacIntyre-Kemp has welcomed the decision on fuel duty, but said plans to increase it should not even have been considered in the first place.

And he warned that a hard Brexit would adversely impact Scotland’s high value exports, particularly in the growing food and drink sector.

“Freezing fuel duty could mean savings of up to £350 a year for delivery van operators and thousands for operators of larger trucks, which is important for deliveries to Scotland’s rural communities,” he said.

“The planned investment in roads in England should mean money becomes available for infrastructure upgrades in Scotland, and we believe this money should be spent on extending platforms and upgrading the east coast rail line as a priority.

“The Borders railway provides a great case study for the demand for rural railway connections and large towns such as Peterhead and Fraserburgh should be first in line for new railway connections. However, the additional infrastructure expenditure announced amounts to only a .25% increase so it won’t actually make that much of a difference.

“Investment in productivity is welcomed but 35 years of keeping the pound artificially strong for the sake of the finance and property markets has destroyed the manufacturing base in both the UK and Scotland, and as a result the spend on close to market R&D has fallen to such low levels it has resulted in a fall in added value production and productivity; this will take a generation to recover. Twenty years of consecutive manufacturing declines means the UK Government is delusional to expect to trade its way out of the looming Brexit driven recession, when its own OBR is suggesting Brexit will decrease exports every year till 2020 compared to its pre Brexit vote forecasts.

“Brexit continues to dominate the economic outlook and a hard Brexit would be extremely damaging for Scotland, especially its growing food and drink sector and other high value exports to the EU.

“Any budget now is just a placeholder till the negative effects of the UK government’s mismanagement of Brexit starts to impact during the two year Brexit negotiation process and the likely 2019 exit from the EU.

“A radical change in economic policy is required and so this budget brings to mind the old saying about rearranging the deckchairs on the Titanic.”

 

About the author

Michelle Rodger

Michelle is a former national newspaper journalist who co-founded an award-winning IT business before launching Tartan Cat Communications. A social media and crowdfunding expert she manages media and communications for Business for Scotland.

4 Comments

  • Members of the conservative party and the government of the day has embarked on a process of Creative Destruction. Simply and usually this is an economical term which is applied to an industry, an evolutionary process which brings about change in an industry or in markets. For those of us who are not involved in such thinking because we are occupied in daily life, bring up a family, paying bills, working, saving and caring for family members or running a business, I use the following example to explain in the normal circumstances what Creative Destruction is and does.

    The retail market has gone through a period of Creative Destruction. How we purchase goods and services for our family or ourselves took place physically on the high street. That changed because innovation was taking place in the form of the internet. The internet changed the way we shop, changed logistics, banking and how money transfers, even how we access or purchase music and visual art. So in addition to the retail market a whole host of other industries changed the way they did business and indeed evolution is still taking place.

    The Conservative Party started the Creative Destruction of the United Kingdom by holding the referendum to leave the EU. The government and leave voters embrace this destruction and want confidence from the population in adapting to the change, there is a new way of working, a new future. There will be more control of our affairs, control over laws and who lives in our country. None of this is unreasonable. What is unreasonable is to embark on a process which affects every industry in the country, affects every single person’s way of live with no visible innovation influencing the change. For those who voted to stay in the EU the government’s approach in the back drop of the much discussed lack of a plan for leaving the EU amounts to nothing less than internal economic terror(ism) on business, families and a generation of our youth. Leaving the EU does not provide innovation in the form of any tangible asset, method, or strategy to replace what we have at the moment.

    As wife, mother, a very ordinary individual and not a member of any particular party. I am in a state of terror, why?

    There is no innovation supporting this creative destruction, there has been no success in establishing inclusive political and economic institutions that encourage participation in our exit and there is no level playing field for the majority of our people. The conservative party and the government have had time before the vote and 5 months after to create innovation. The arrogance of stating it can’t declare it’s hand regarding negotiations begs believe. Do they think the EU does not know what the UK wants. Free market trading, at no cost, and no freedom of movement into the UK. The UK is looking for a set of circumstances which the EU and international institutions cannot give. Creative Destruction is needed to evolve industry, markets, economic growth and redistribute wealth. When it fails, the nation fails.

    Creative Destruction has happened without innovation being present. The government and EU leavers want the political institutions to agree to adopt a vicious extraction of the whole of the UK population from EU markets and immigration. There are no other political or economic institutions proving an acceptable alternative outcome. We have for sometime been a part of a political and economical environment were the working population didn’t prosper because both the political and economic institutions have been extractive in their activities. The democratic vote outcome also provides fuel for the political extractive position and exit from the EU. Everyone knows the result, it is what you do with it is the matter at hand. The reasons for it’s outcome is what is being peddled as all important and is now creating our own bird cage for our economy and little hope of even a bigger cage for the the economy to grow. The extractive politics of the government is removing all the other elected politicians and the majority of the population from participation in the political or economic effects of our departure. This approach will also promote the elite leaving the majority behind. Throughout history, extractive institutions only lead to stagnant economic growth. Creative Destruction require political and economic inclusive institutions, allowing the population to participate in the political and economic systems of the country. The direction the government has taken is leaving the country void of this element and why this approach as opposed to others available it is best described as internal economic terrorism.

    As a scot with a vote that goes down the drain each time I use it, I ask the question. For the love of god when is another party going to announce an inclusive plan that people can buy into even if start the debate? Treat it as a manifesto and leave an open invitation for other inclusive political parties to amend or suggest. The country will thank you for it. Don’t leave the tory party setting the agenda for an EU exit.

  • Due to the falling pound and the shrinking ‘Broad shoulders’ of the UK, we now pay more to the EU, about £15m a week as our contributions are in Euros.
    Brexit has not even happened yet!
    Is Hammond with the PM sleepwalking into a disaster or are they just clueless?
    May to go early next year when the contradictions get overwhelming?
    After the interview with the Maltese PM in the media today, a deal is out of the question.

    • Also 17.5% of EU grants to the UK come to Scotland with only an 8.4% share of UK population as grants are in Euros we are more protected than rest of UK from exchange rate led EU membership fee inflation.

  • Any chance somebody could do an analysis of Scotland’s ‘exports’ to the rUK? What we really need is a breakdown to determine how much of these exports are in fact transhipments out of English ports to foreign destinations.

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