Lesley Brennan, Scottish Labour parliamentary candidate on the North East Scotland list, says Labour has a serious plan to boost the Scottish economy.
The Scottish economy needs a boost. It is weak both in absolute terms and relative to the rest of the UK.
- GDP growth is very weak – almost stagnant.
- Unemployment increased by 19,000 between December 2015 and February 2016 (from 5.4% to 6.2%) but the UK rate is unchanged.
- Scottish manufactured exports percentage growth was estimated as -1.5% for Q4 2015.
- House prices in Scotland are down, unlike in much of the rest of the UK.
- The Conservative government shrink the Scottish economy by £2.4 billion per annum via their welfare reforms.
So, what’s the Scottish Labour plan to boost the economy?
There are two ways to generate economic growth:
- Exogenous: expand by attracting more investment (such as the secret SNP FDI planned with the Chinese company blacklisted by Norway’s oil investment fund).
- Endogenous: use resources in Scotland to invest in Scotland to expand the economy.
Scottish Labour wants to attract investment to Scotland and thinks Scotland can attract more attractive investors than one with “a risk that the company is involved in gross corruption”.
In countries with higher levels of inequality economic growth is found to be low, but redistributive policies can reduce inequality and boost the economy.
Scottish Labour will implement endogenous growth by using redistributive policies: 1p on the Scottish Rate of Income Tax; a 50p tax rate for earners on £150k or more; not implementing the change in the higher rate tax threshold; the new property tax and the new local taxes.
The Institute for Public Policy Research Scotland estimate Scottish Labour’s proposals will generate £1.1-£1.2 billion additional spend each year. This will allow significant investment in communities and our people over the next five years. This money will be invested in education, house building and other infrastructure programmes. This investment will expand the economy further due to the fiscal multiplier; we could see the economy expand by a further £300m per year.
Scottish Labour is going for growth to benefit everyone in Scotland. This is why people wanting a stronger economy need to give both votes to Scottish Labour.