Binning Barnett would be Bad for Scotland says North MSP

16th January 2015

Highlands & Islands (Labour) MSP and Shadow Minister for Transport and the Islands David Stewart speaking today (16/1/15) said " We are now seeing a full blown crisis in the North Sea. The price of oil is less than half of what the Scottish Government predicted it would be last year".

"The crisis is the biggest threat to jobs in Scotland since the closure of Ravenscraig over twenty years ago and BP are already announcing job losses. It is important to realise that this is far from confined to off shore workers, it's about jobs across the whole of Scotland in the supply chain or supported by employee spending.
That is why Scottish Labour have been calling for action since last year, when the price of oil started declining sharply".

David Stewart continued “The Scottish Government have backed Scottish Labour's call for the Treasury to take action with changes to the tax regime.
We also want to establish a resilience fund to protect local economies threatened by a jobs crisis, as well as using business rates to support local businesses on the high street feeling the knock on effects”.

“Whilst we have been setting out clear plans to protect jobs, the Scottish and UK Governments have been pointing fingers at each other. The SNP in particular were slow to react to the falling price. Why? Because it was politically embarrassing for them”.

He continued “Scottish public services, our schools and hospitals in Highlands & Islands and across Scotland have been protected from the dropping oil price by the Barnett formula”.
“This is the system which means we pool and share resource across the United Kingdom and see Scotland receive an extra £1,200 per head in public spending.

The SNP want to campaign in May’s General Election on a platform of binning Barnett and relying on declining oil and gas revenues to fund our public services”.

“This has been confirmed by all the senior members of the SNP - The First Minister, the Finance Secretary, even Alex Salmond”.

David Stewart went on “That means Scotland would be faced with a straight choice. Would we attempt to protect jobs linked to the oil industry or protect the funding for our schools, hospitals and pensions?

The cost to Scotland of binning Barnett would be close to £4 billion - that’s an estimate from the SNP themselves”.

“At a time when the global oil price is plummeting, where is the sense in trading the stability of Barnett and higher public spending for the instability of volatile oil prices and the big spending cuts that would be needed”?

“The current Barnett Bonus means that Scottish Labour’s pledge to fund an additional 1000 nurses through a Mansion tax will be overwhelmingly financed by rich property owners in London.

It means we can use the UK wide pot of money to deliver more funding for Scotland, with the polices that Scotland needs. The SNP seem to think binning Barnett is good politics but it would be bad for Scotland”.