Chancellor Rishi Sunak has indicated the Treasury will not provide extra cash for Aberdeen to help the city with the reintroduction of lockdown restrictions.
On a visit to Scotland, Mr Sunak said it was for the Scottish Government to provide support during local lockdowns, as he warned the UK Government’s furlough scheme cannot go on indefinitely.
The UK Government has spent £33.8 billion supporting the payrolls of 9.6 million workers, including almost one million Scots, during the coronavirus crisis. But Mr Sunak confirmed the furlough scheme will end in October.
Eight months of support from start to finish is a considerable period of time for the government helping to pay people’s wages and I just don’t think that is something that can go on indefinitely.”
Chancellor Rishi Sunak
Rishi Sunak quizzed on Aberdeen lockdown
Heading north of the border to publicise the billions that the Treasury has spent on supporting people during the pandemic, Mr Sunak was asked if there would be more help for Aberdeen.
“The Scottish Government no doubt will be talking to Aberdeen and providing whatever support they think is appropriate in those circumstances,” the Chancellor said.
Mr Sunak added that local business support was a “devolved matter” and therefore the responsibility of the Scottish Government.
“The Scottish Government has done slightly different things in how they’ve decided to support businesses and that’s absolutely their right and I’m sure they will be looking at that,” he added.
Now is not the time for indyref2, says Chancellor
The Chancellor also repeated the UK Government’s line that now was not the time for a second Scottish independence referendum because efforts should be focused on recovering from the coronavirus crisis.
With the SNP riding high in the polls, he also expressed the hope that, as time went on, voters would acknowledge the billions of pounds the UK Government had provided during the crisis.
“I would hope that people when they go through this and reflect on what’s happened they can see the benefit of the Union. It is not just the economic measures, jobs in Scotland are equally as important to me as anywhere else in the United Kingdom. As we think about our recovery measures that we are putting in place again, it will benefit jobs everywhere, but especially jobs in Scotland with regard to tourism.
“On the health side, there has been an enormous amount of collaboration whether it has been on testing, PPE or vaccines and bit by bit I hope those are the kinds of arguments that people will see the benefit of the Union.”
Mr Sunak argued UK schemes such as Eat Out to Help Out and VAT reductions in the tourism sector can”disproportionately benefit the Scottish economy and Scottish jobs and in doing so help drive the UK recovery”.
He said: “So, to me, all of that experience shows me the Union has an enormous resonance today and hopefully people will recognise that.”
The Chancellor also said he didn’t think “now is the time to be talking about these constitutional questions.
“I think everyone’s sole focus, and certainly my sole focus right now, is doing what we can to protect people’s jobs and their livelihoods at what is an incredibly difficult time for our economy, and that’s what I think everybody should be focused on. Let’s not focus on these divisive constitutional questions, let’s focus on rebuilding for the future.”
Rejects calls to extend the multibillion-pound furlough scheme
On his trip to Glasgow and the Isle of Bute, he resisted calls for the furlough scheme to be extended beyond October.
“Eight months of support from start to finish is a considerable period of time for the government helping to pay people’s wages and I just don’t think that is something that can go on indefinitely,” the Chancellor said.
He argued that having people out of the labour market for a long period would not help their job prospects.
“It would be easy to tell people it’s all going to be fine and that job will be there. That won’t be true for everybody and, in those circumstances, having people not attached to the labour market for that prolonged period of time is not doing them any favours.
“All the academic evidence and practical economic evidence that we have on labour market outcomes tells us that. People not being attached to a workplace is not good for their long-term prospects. If it is not going to be the case that that job is going to be there, we are better off providing new opportunities and different types of support.”
Hopefully what we see with these local lockdowns is that they are not going to be very long in duration.”
Chancellor Rishi Sunak
With people in Aberdeen potentially missing out on his Eat Out to Help scheme with the return to lockdown, Mr Sunak appeared reluctant to make allowances for them.
“We have kept it as a national scheme for the month,” he said. “We keep everything under review, but it is tricky to figure out exactly the right way to tweak that. It is complex. Hopefully what we see with these local lockdowns is that they are not going to be very long in duration,” the Chancellor said.
The Federation of Small Businesses (FSB) Scotland called for Aberdeen firms to receive more help.
An FSB spokesman said: “The longer the Aberdeen lockdown continues, the more likely it is that businesses who, through no fault of their own, have been forced to close – or who remain open, but have seen footfall plummet – will need support.
“The amount and nature of that support will matter more to them than whether it comes from the council, Holyrood or Westminster. That said, we know that, as elsewhere in the UK, funds earmarked for local support grants in Scotland are underspent. Repurposing that cash to set up a support fund for businesses hit by local lockdowns would seem a sensible place to start.”