Down one path will be the well-trodden Tory route of harmful policies like austerity, Brexit and a failure to invest in renewable energy, which have cost the economy billions of pounds, decimated social security, and pushed many households over the brink.
The other unfamiliar path for the Tory Chancellor is one that steps up to the challenge and delivers real, targeted support to help protect people’s livelihoods and incomes as we grapple with a Tory cost-of-living crisis of higher food prices and household bills.
The reality is that this crisis has been a decade in the making which the SNP has been repeatedly warned about. It has been brewing under successive Tory governments who have pursued damaging policies that have led the UK to have the worst levels of poverty and inequality in northwest Europe and the highest levels of in-work poverty this century.
With each day that passes, new research and analysis sounds the alarm over the extremely difficult challenges facing people right across the UK. Just recently, for example, the TUC warned energy bills were on course to rise at least 14 times faster than wages this year, wiping out people’s pay rises and delivering a hammer blow to household income.
Meanwhile, the Resolution Foundation highlighted that UK households could face the sharpest decline in real incomes since the 1970s, with a fall of £1,000 per household for non-pensioners – a level of decline usually associated with a recession, according to researchers.
Edinburgh MSPs back plea to Chancellor: Take VAT off defibrillators
And consumer group Which? revealed in a survey that people in Scotland will spend an extra £21.13 per week on food and energy in April 2022 compared to March 2020, piling on around £1,100 extra per year to household bills. Worryingly, its polling also revealed that of two-thirds of people in Scotland who had noticed higher food prices, 13 per cent admitted to skipping meals entirely.
The chorus of warnings has been growing louder but appears to be falling on deaf ears in Downing Street, with both the Prime Minister and his Chancellor failing to properly step up to tackle the crisis.
This cannot go on. A refusal to rise to the scale of the challenge with real support and investment will not just be a missed moment, it will deliver a hammer blow to our economy, people’s livelihoods and businesses.
In many ways, this will be a mini-Budget like no other; both at home and abroad the UK faces real challenges that require leadership.
The devastating war in Ukraine has rightly led to the UK being united in its condemnation of Russia’s actions and unequivocal in our support for our Ukrainian partners.
However, the UK government cannot be allowed to use the war in Ukraine as a smokescreen for its failure to tackle the spiraling Tory cost-of-living crisis. It cannot be used as cover to mask years of Tory failure.
Yes, the UK Government must step up its efforts in supporting our Ukrainian friends, which the SNP will continue to push for, but it must also deliver real policies here in the UK to support households who are struggling to make ends meet as energy and household costs rise rapidly.
Rather than seeking cover, the Chancellor must instead deliver a comprehensive support package that will cushion the blow of the Tory cost-of-living crisis. This must include at the very minimum converting the £200 energy loan into a more generous grant, maintaining the 12.5 per cent VAT rate on hospitality and tourism services, scrapping the National Insurance tax hike, reversing the £1,040 cuts to Universal Credit, matching the Scottish Child Payment UK-wide, and introducing a Real Living Wage to boost incomes.
To support those on the lowest incomes, the Chancellor must follow the lead of the Scottish Government who have announced they will increase eight Scottish social security benefits by six per cent from April 1.
And no budget statement can be completed without addressing the resident elephant in the room. Brexit.
As costs rise across the board, businesses are not exempt from the economic impact of the unfolding crises. The unnecessary red tape and Brexit bureaucracy is piling up, hitting exports, leaving businesses out of pocket and resulting in staff shortages. This toxic concoction is a recipe for disaster, and it will be consumers who will be left with a bitter taste in their mouths as costs inevitably go up.
The UK Government must wake up to the reality of their Brexit mess and set out a multi-billion-pound compensation package for Scotland, mitigating the damage done and following the EU’s €1.05bn for Ireland.
These key measures will form the foundations needed to alleviate the burden being shouldered by businesses and households. The Chancellor has the opportunity to lighten the load so ordinary people are not pushed into poverty and hardship. No family must face the terrifying choice between putting the heating on or putting enough food on the table.
The UK government can, and must, do better.
As Rishi Sunak approaches the crossroads, he must turn away from the Tory road to austerity and instead take the path to deliver real support for families, businesses and households at this critical moment.
If he does not, he will cement his legacy as the poverty Chancellor.
The reality for people in Scotland is that we find ourselves in the middle of a Tory cost-of-living crisis precisely because successive Tory governments have imposed harmful policies and rejected calls to inject investment.
With every day the UK Government fails to use its reserved powers to tackle the cost of living, it is making the case that independence is the only way for Scotland to increase incomes and build a fairer society.
Alison Thewliss MP is SNP Shadow Chancellor
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