Chamber and committees

Will the member give way?

It is somewhat ironic to hold a debate on energy at this point on a Thursday afternoon, so let me try that witticism to begin with.

In some ways, Jackie Dunbar is absolutely right to articulate frustration. The burning imperative in front of us is that we have to make the just transition in energy work. However, there is some irony in being frustrated about what GB Energy should be delivering when we have not yet passed the bill. Notwithstanding the frustrations of the legislative process, what we are here to do is to agree to the LCM. Let us focus on the aim of the LCM. We need GB Energy to be up and running.

Let me deal head on with the assertions and the, frankly, slightly wild accusations made by Douglas Lumsden. Let us be clear. He treats the issue as though it is binary—that we have the option of either using oil and gas or turning to renewables. However, that is a false choice. Whether we like it or not, there needs to be a transition. Whether we listen to the North Sea Transition Authority or the Wood Group, it is clear that more than 90 per cent of the extractable resource of the North Sea has been extracted. Peak oil was in 1999. We need to transition our North Sea energy sector regardless of the net zero imperative. When people talk to representatives of the oil and gas sector, as I do, they will not hear them asking whether we should have GB Energy; they want to get on with it, because they recognise the need to transition.

It is central to the plan. If Douglas Lumsden wants a plan, he should back GB Energy. For goodness’ sake, we cannot, on the one hand, say that we need a plan and then oppose GB Energy. The Tories should not be ridiculous—seriously.

The reality is that we need a transition. We also need GB Energy, for two critical reasons. First, the transition has to happen at such a pace that, if there were no state intervention, it could not occur. Secondly, it will rely on innovation, technology and engineering that we do not yet have in place. Unless we derisk the process and the investment, the transition will not happen and we will squander the legacy of the North Sea. When people talk to industry representatives, one thing is abundantly clear: our North Sea legacy gives us the ability to do engineering work offshore, at sea, in the harshest of conditions, which we will need to do if we are to reap the benefits of the energy transition.

What does Douglas Lumsden think GB Energy is about?

The word “fraud” has a very precise meaning. Perhaps Douglas Lumsden could explain his use of it.

In case he is not aware of the way in which legislation works, I note that the bill is not yet passed, and that GB Energy will not be able to be up and running until it is passed. Perhaps he wants to reconsider his language somewhat.

On a point of order, Presiding Officer. Although I do not ask for an answer now, what has just happened sets a precedent that raises a great number of questions across the chamber. I politely observe that I do not think that any member can be in two places at once. While taking part virtually, members need to be present at their terminal. I query whether all members were in that position when the vote took place. Some consideration should be given to what has just occurred.

On that technical point, why is the Government not waiting until the final reading to wrap up the LCMs into a single decision for the Parliament?

If we listen to Craig Hoy, it is as though the previous 14 years did not happen. Therefore, I will start where, I hope, there is some agreement with members on the Government benches. The fiscal inheritance that was left by the previous UK Conservative Government was nothing short of a disaster—debt at 100 per cent of gross domestic product, a £20 billion fiscal black hole and record low investment. After 14 years of chaos and division, the public realm was simply crumbling and public services were in urgent need of investment.

It was in that fiscal climate that Labour had to make a series of difficult decisions in the autumn budget, in order to end the era of austerity and provide billions of pounds of investment in public services. That budget included a record-breaking settlement for Scotland, with an additional £5.2 billion both this year and next, which is the largest settlement for the Scottish Government in the history of devolution.

The manifesto said, “taxes on working people”. The reality of the fiscal context was that there were difficult decisions to be made. This is not a magic bullet for public sector reform but, with one in six Scots on NHS waiting lists and with attainment falling in schools, we need additional public funds—although I also argue that we need reform and that we must modernise delivery of public services.

I am not going to stand here and say that the decisions were easy, because they were difficult. The choices that the Labour Government had to make to fix the foundations of the economy were not cost free. As someone who was an employer before coming to Parliament, I understand the difficulty that the measure will cause for employers who have to make payroll payments every month. I understand that, but the measure was necessary.

I also note that, although larger employers are being asked to contribute more, those who employ five people or fewer will benefit because the increased thresholds will remove altogether 57,000 SMEs from making national insurance contributions.

It is also important to note the international context. The rate of employer contributions puts us absolutely in the middle among countries in the Organisation for Economic Co-operation and Development. In Germany, employer contributions are 50 per cent higher than they are in this country and those in France are double what ours are.

The decision was not easy and was not one that the UK Labour Government wanted to make, but it was necessary—which brings me to the question about what SNP members are proposing as an alternative, because that is not clear. They reject the fiscal measure of increasing employer national insurance payments, but they also voted against the windfall tax and against changes to the loophole for people with non-domiciled status.

What would the SNP do differently? What fiscal measures would it take? This may be where we need to exchange stern looks. What would the SNP do? Would it increase personal income tax? That is not something that I would advise at this time, when people are struggling to make ends meet and to pay their monthly utility bills. Would SNP members increase employee national insurance contributions? That would have exactly the same effect. Would they put up VAT, which is the most regressive form of tax and the one that hits the poorest people hardest?

We have heard no alternatives from the SNP. The only contribution has been from the First Minister, who suggested that the UK Government should raise UK income tax to match levels in Scotland. It seems that the First Minister, who helped to negotiate the fiscal framework, has forgotten how it works. According to the Fraser of Allander Institute, that would reduce the amount of money that would be available to the Scottish Government by £636 million.

The SNP is not only calling for changes to national insurance contributions. In addition, SNP ministers and members have proposed almost £70 billion of additional public expenditure in the lead up to the budget without having a single idea about how to pay for that. There is no spending decision that the SNP is not in favour of, but it is without a single proposal about how it would pay for them. At the general election, the SNP called for an increase in borrowing to pay for additional public expenditure, but without any credible plan for how to deliver that.

There is a parallel with that—Trussonomics. Unplanned borrowing leads to financial chaos and to the instability that members on the Government benches are all too keen to criticise the Conservatives for.

Frankly, SNP members need to inject a little bit more honesty into their arguments. When it comes to passing their budget, they often charge members on the Opposition benches who have come forward with proposals for additional expenditure with saying how they would pay for it. Where would the money come from? What else would they cut? Those are the questions that I pose to them. If they do not want to increase employer national insurance contributions, what would they cut? They do not want to increase tax and, I presume, they do not want to increase borrowing. Are they saying that we should reject the £5.2 billion from the block grant that the measure delivers?

In my view, honesty is a primary responsibility of the Government. This Government needs to be honest about what it is proposing, but I do not believe that it does that in the motion. The maths is simple: the £5.2 billion is considerably more than the additional costs that it is incurring through the national insurance increase. If it cannot do the maths, maybe the SNP is not fit to be in government, and maybe it should make way for people who are.

I move, as an amendment to motion S6M-16488, to leave out from “recognises” to end and insert:

“welcomes the record £5.2 billion of additional funding for Scotland delivered as a result of the UK Government’s Autumn Budget; agrees with the STUC that the additional positive measures that are set out in the draft Scottish Budget 2025-26 are ‘dependent on UK Government funding’; regrets that the fiscal changes called for by the Scottish Government would significantly reduce the level of funding available to Scotland’s public services; understands that the First Minister has publicly advocated for a cut to Scotland’s budget of £636 million; regrets that the Scottish National Party administration’s failure to grow Scotland’s economy has negatively impacted the level of funding available in the Scottish Budget over many years; understands that decisions around the level of staffing in Scotland’s public services are devolved to the Scottish Government, and calls on the Scottish Government to ensure that the record funding delivered by the UK Government reaches the frontline services that need it most.”