Press Release

22^nd March 2000

£2.4 Billion Budget – Delivers for Scotland and Inverclyde

MSP for Greenock & Inverclyde, Duncan McNeil, today welcomed yesterday’s Budget as "good news for everyone."

"It is good news for pensioners, for single parents, for those seeking work, for the NHS, for education and for many other areas of public life." He said.

"Gordon Brown has delivered an extra £2.4 Billion to Scotland over the next four years. We are staying focussed on our priorities of improving schools and hospitals; expanding employment opportunities and combating pensioner poverty. This budget helps us to deliver these goals."

The main points of yesterday’s budget are:

From April this year:

• The NHS will get an extra £173 million.

• There is an extra £15.9 million on the increase in transport funding;

• An extra £86.6 million on the increase in education provision; and

• An extra £8.9 million on the increase in police provision.

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Mr McNeil also greeted the cash boost for pensioners.

"We are continuing to tackle pensioner poverty in Scotland. And, although there is a long way to go, this Budget is a great help. I am sure that the pensioners of Inverclyde will warmly welcome this budget.

"In addition to the increase in the winter fuel allowance from £100 to £150, changes to the minimum income guarantee will benefit 9,000 of Scotland’s pensioners."

The main measures in the Budget for pensioners are:

• The increased winter fuel allowance – from £100 per year to £150 per year for every pensioner household – benefits over 700,000 Scottish households.

• The change to the minimum income guarantee – which means pensioners can have savings of £6000 as opposed to £3000 before it affects their income support – benefits 9,000 of Scotland’s poorest pensioners.

• The already announced, free TV licences for over 75’s will be available to 250,000 Scottish households from 1^st November – but now pensioners will be entitled to a refund if their current TV licence goes beyond that date.

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"The Budget also supports families and takes our fight against child poverty forward." Mr McNeil continued

"The Working Families Tax Credit has been increased so that 130,000 working families in Inverclyde will have an increase in their weekly income.

"The Children’s Tax Credit being introduced in April 2001 has been increased, so that it is worth £442 a year – more than twice the value of the married couples allowance it replaces.

"Increased help is being given to low income parents when a child is born, including reform to the Working Families Tax Credit from May 2001 worth as much as £30 a week. The Budget has also delivered a £100 increase in the Sure Start Maternity Payment from July 2000. This is on top of the £1000 increase already taking place in April."

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In terms of the impact on business, Mr McNeil was equally upbeat:

"Inverclyde’s regeneration depends on attracting and securing inward investment and encouraging enterprise. I believe this Budget will do both and that Inverclyde’s business community will also be celebrating.

"Over the next four years there will also be an increase in funds for new businesses of £8.7 million.

"The cuts in capital gains tax – which will increase investment and therefore productivity – will benefit 53,000 Scottish companies.

"Capital allowances of 100% are being introduced for small enterprises investing in IT equipment. This will make a practical difference to SME’s – the backbone of our economy – in modernising and joining the e-commerce revolution. This will benefit 52,000 Scottish companies."

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"Together with my colleagues in the Labour Party, I am committed to increasing employment opportunities and making work pay. Our ultimate goal of full employment can be delivered and yesterday’s Budget will help significantly.

I welcome the fact that the new Deal is to be extended and improved. It has already ensured that over 17,000 people who have gone through the New Deal are in sustained employment in Scotland. The New Deal is widely credited with the 69% reduction in youth unemployment since 1997."

Other key measures to help people into work include:

• A new job grant of £100 is being introduced from 2001 to ease the transition into work.

• The government is committed to helping people, move from welfare to work, making work pay, and easing the transition to work. It has introduced the Working Families Tax Credit and the National Minimum Wage (benefiting 100,000 Scottish workers), introduced a new 10p rate of income tax and will cut the basic rate of income tax to 22p in April.

ENDS

Notes:

Please note that this additional money is based on the application of the Barnett formula – how this additional money is spent is a matter for the Executive itself – but Donald Dewar has stated in the press that he intends to stick to the Chancellor’ plans.

In other words, the Scottish Executive could direct this additional money into whichever public areas they want – but Donald Dewar has indicated that the Chancellor’s line will be followed.

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