:00:00. > :00:00.The Chancellor serves up tax sweeteners and spending cuts,
:00:00. > :00:30.George Osborne's delivered his eighth budget.
:00:31. > :00:34.In it, he serves up ?3.5 billion of cuts.
:00:35. > :00:36.There's tax relief for the ailing Scottish Oil Gas
:00:37. > :00:42.There's a not so sweet surprise for the sugary drink
:00:43. > :00:56.And there's a warning about where the economy's heading.
:00:57. > :00:59.This was a high-stakes Budget for George Osborne -
:01:00. > :01:03.ahead of a referendum on Europe, and the impending contest to replace
:01:04. > :01:14.And all, against a troubling backdrop - what he called
:01:15. > :01:16.a dangerous cocktail of global risks.
:01:17. > :01:18.So there was give and take from the Chancellor.
:01:19. > :01:25.And surprises, designed to grab the headlines.
:01:26. > :01:27.So let's have a look at some of the key measures
:01:28. > :01:37.First - tax cuts to help the Oil and Gas industry -
:01:38. > :01:41.George Osborne said Petroleum Revenue Tax would be
:01:42. > :01:44.And what's called the supplementary charge for oil
:01:45. > :01:48.companies will also be cut - from 20 percent to 10 percent.
:01:49. > :01:50.All told the UK government say the measures are worth
:01:51. > :01:55.There's help for another of Scotland's major
:01:56. > :02:03.But a new sugar tax will be imposed on the drinks industry,
:02:04. > :02:07.which will come into force in two years time.
:02:08. > :02:15.AG Barr, who make Irn Bru has seen its share price fall by 2.5
:02:16. > :02:19.On income tax, we'll see the tax free
:02:20. > :02:24.personal allowance raised to ?11,500.
:02:25. > :02:27.And from April next year, he's going to
:02:28. > :02:30.raise the threshold at which people pay the higher rate of income
:02:31. > :02:38.Our reporter Andrew Black has been gathering reaction on the impact
:02:39. > :02:55.The city of Aberdeen is one of Europe's energy capitals. The fall
:02:56. > :03:00.in oil prices have cost up to an estimate of 65,000 jobs in Britain's
:03:01. > :03:05.offshore sector, with much of that downturn felt here. Today the
:03:06. > :03:11.Chancellor announced a much welcomed plan to turn things around, with tax
:03:12. > :03:15.cuts for the North Sea industry. There are many companies paying tax
:03:16. > :03:20.because they're not making profits. It's a really challenging time for
:03:21. > :03:23.the industry but still a positive step to reinforce that actually, the
:03:24. > :03:27.Government sees this as a sustainable and injuring industry
:03:28. > :03:32.that is worth investing in. I now call the Right Honourable George
:03:33. > :03:37.Osborne. That announcement was one of many in George Osborne's budget.
:03:38. > :03:42.Today he said his spending plans would help the economy while urging
:03:43. > :03:46.the need for caution after downgrading economic forecasts. This
:03:47. > :03:50.is a budget that gets the investors investing, savers are saving,
:03:51. > :03:54.businesses doing business so that we build for working people in low tax
:03:55. > :04:00.enterprise Britain, secure at home and strong in the world, I commend
:04:01. > :04:07.today has a budget that puts the next-generation first. Whilst an
:04:08. > :04:11.extra ?3.5 billion of spending cuts also announced, his opponents said
:04:12. > :04:15.it would do nothing of the sort. It is a recovery built on sand on a
:04:16. > :04:21.budget of failure, it is built on the budget deficit, on debt, an
:04:22. > :04:25.investment, on productivity, field on trade deficit, on the welfare
:04:26. > :04:33.cap, failed to tackle inequality in this country. It is also important
:04:34. > :04:38.to note this is the last budget if Chancellor will set for the entirety
:04:39. > :04:42.of the UK ahead of new financial powers coming to Holyrood and given
:04:43. > :04:47.today's announcement that the rate at which workers start playing top
:04:48. > :04:52.rate tax is to be increased raises questions about what Scottish
:04:53. > :04:55.ministers will do. The big challenge will be whether the Scottish
:04:56. > :05:00.Government follows the UK Government, if it doesn't follow its
:05:01. > :05:06.the political danger is that Scotland becomes branded as a high
:05:07. > :05:10.tax part of the UK. When you're deciding for you want to work, one
:05:11. > :05:17.thing you look at what is my take-home pay going to be? If we
:05:18. > :05:21.move to Scotland and we start reducing some of these bindings are
:05:22. > :05:26.you go into 40% quicker, maybe you might think twice about moving to
:05:27. > :05:30.Scotland to work. Equally we could use the measure the other way and
:05:31. > :05:35.increase the band so it takes longer before you hit 40%, so we would
:05:36. > :05:39.become attractive. What is the Scottish Government planning? We've
:05:40. > :05:46.reset our tax race for 2016-17 and they will not change. We will
:05:47. > :05:49.acquire new powers in 2017 with the ability to very many of these issues
:05:50. > :05:53.and the Government will consider a position and set that out well in
:05:54. > :05:56.advance of the election to enable people in Scotland to form a
:05:57. > :06:00.judgment about these plans. What we have set out at the weekend at our
:06:01. > :06:06.party conference is the fact we are not persuaded this is the moment to
:06:07. > :06:11.reduce taxes for people on higher incomes. There was another
:06:12. > :06:14.announcement today, a UK wide tax on sugary drinks to tackle the city.
:06:15. > :06:19.Scottish ministers will get a share of the takings to spend as they
:06:20. > :06:23.want. But AG Barr, which makes Irn Bru, said it was disappointed to
:06:24. > :06:30.have been singled out when it was working to cut calories in its
:06:31. > :06:36.products. Today's budget may have brought a sense of calm debate is
:06:37. > :06:40.hit by hard times like Aberdeen but could that be short lived if the
:06:41. > :06:45.Chancellor is warning of a dangerous cocktail of global economic risks,
:06:46. > :06:46.could more spending cuts be on the horizon?
:06:47. > :06:47.Lots of eye-catching announcements in the budget.
:06:48. > :06:53.Well, the independent Office for Budget Responsibility has cut
:06:54. > :06:57.Britain's growth forecast for the next five years.
:06:58. > :06:59.And George Osborne's warned of a "cocktail of risks"
:07:00. > :07:05.But he's stuck to his target of hitting a budget surplus by 2020.
:07:06. > :07:11.That where government spending is less than the revenues brought in.
:07:12. > :07:18.To do that, he's spelled out another ?3.5 billion in spending cuts,
:07:19. > :07:22.But, according to the OBR, the Chancellor's missed his target
:07:23. > :07:25.of starting to cut the national debt as a percentage of output
:07:26. > :07:35.But the OBR said all its forecasts have been made on the assumption
:07:36. > :07:38.that Britain would remain in the European Union,
:07:39. > :07:48.And in our London studio now is Stephen Boyle,
:07:49. > :07:51.who is the Chief Economist at the Royal Bank of Scotland.
:07:52. > :07:57.Thank you for joining us. We know there is lots of theatre in a
:07:58. > :08:02.budget, lots of politics, but spell out for us if you would the picture
:08:03. > :08:07.that has been painted from those figures from the OBR about the state
:08:08. > :08:13.of the British economy? What they said today is that grows over the
:08:14. > :08:16.next few years will be materially slow, we selected it to be when the
:08:17. > :08:20.Chancellor gave his Autumn Statement in November. The most important
:08:21. > :08:25.factor lying behind that is that they believe the rate of
:08:26. > :08:30.productivity growth at which we can produce things for every ever we are
:08:31. > :08:36.at work in this country is slowing. Not by a little, by quite a lot.
:08:37. > :08:41.That is significant, partly because if we are not growing productivity
:08:42. > :08:46.as fast as we thought people's incomes cannot ride as quickly as
:08:47. > :08:49.they might expect. It is important for the Chancellor because slower
:08:50. > :08:55.productivity growth means there is simply less of an income base from
:08:56. > :08:59.which he can generate tax income. Pessimistic forecast, but I wonder,
:09:00. > :09:04.can we rely on these forecasts? Because they seem to change a lot
:09:05. > :09:11.over time? I suppose I should defend the Economist trade union Begu at --
:09:12. > :09:16.but I think you have a fair point. Forecasts are part art and part
:09:17. > :09:19.science, the office for budget was recognises there is a huge amount of
:09:20. > :09:26.uncertainty in any forecast, which is why, for example, they say they
:09:27. > :09:33.believe the Chancellor will hit his target of making a surplus in
:09:34. > :09:37.2019-20 but there is just over 50% chance of that happening. That
:09:38. > :09:41.reflects the uncertainty underpinning the forecasts. I saw,
:09:42. > :09:50.the Chancellor that commitment and is aiming to hit a budget surplus by
:09:51. > :09:57.2020. I wonder how helpful, amid all these concerns, is that target?
:09:58. > :10:02.Bridge means cuts when many think we should be investing more, is the
:10:03. > :10:05.strategy right? I think all possible governments need to have fiscal
:10:06. > :10:12.targets, and the target the Government has at the moment that by
:10:13. > :10:18.2019-20 total incomes should exceed total spending, has the virtue of
:10:19. > :10:24.being very clear. You know if they are hated. My concern is that it
:10:25. > :10:29.treats all spending is being the same and there is a compelling
:10:30. > :10:32.argument that investment spending should be treated differently from
:10:33. > :10:36.spending on day-to-day public services because if you are doing
:10:37. > :10:39.the right kind of investment the new generating additional income for
:10:40. > :10:42.people and the economy as an entirety for a longer period of time
:10:43. > :10:47.and it's a good I quench that you could take responsible investment
:10:48. > :10:55.spending out of that target and in the balance tech -- tax revenue
:10:56. > :10:59.against data be -- day-to-day spending. The OBR said all of their
:11:00. > :11:02.predictions about the state of the economy and the future were based on
:11:03. > :11:07.assumptions that Britain would remain in the European Union. It
:11:08. > :11:14.appointed George Osborne to say that leaving the EU would usher in a
:11:15. > :11:17.period of dangerous volatility. It is the jumping to conclusions of
:11:18. > :11:23.putting a political spin on what is basically a statement of the office
:11:24. > :11:27.from the OBR? I don't think we should criticise politicians from
:11:28. > :11:32.making political points. I do think is that while people can have
:11:33. > :11:36.reasonable dispute about the economic consequences of remaining
:11:37. > :11:42.in or leaving the European Union, there is a solid consensus that were
:11:43. > :11:46.the votes to be close in the run-up to it or were we to decide to leave
:11:47. > :11:49.and there was a period of negotiation there would be
:11:50. > :11:55.uncertainty about the longer term prospects for the UK, and that would
:11:56. > :11:56.be damaging for growth. Many thanks. Stephen Boyle, chief economist at
:11:57. > :11:57.RBS. Just before we came on air,
:11:58. > :12:00.I spoke to the Chief Secretary to the Treasury, Greg Hands,
:12:01. > :12:02.who came into our Millbank studio. And amid those concerns
:12:03. > :12:05.about the state of the economy, I asked him what the Conservatives
:12:06. > :12:17.were doing wrong? Let me say a little if I can about
:12:18. > :12:20.the good news in the economy, we just had the employment numbers
:12:21. > :12:25.across the UK today showing a record number of people in employment, 31
:12:26. > :12:29.million. We have also had news on the deficit and have brought the
:12:30. > :12:36.guest sits down by two thirds since its height under Labour in 27. We
:12:37. > :12:41.also see problems in the world economy that will not leave the UK
:12:42. > :12:45.immune, one of the reasons why forecasts for economic growth in the
:12:46. > :12:48.next four years have been downgraded, but that is one of the
:12:49. > :12:52.reasons we are doing something about it in terms of doing something about
:12:53. > :12:58.the UK's productivity and making sure we continue to be going strong.
:12:59. > :13:02.I might add that within those forecasts the UK is predicted next
:13:03. > :13:06.year to have the strongest rate of growth of any major Western country.
:13:07. > :13:11.Yet all of these forecasts are heading the wrong way. When Labour
:13:12. > :13:15.were in charge you said the global financial crisis was all their
:13:16. > :13:21.fault. Are you trying to have it both ways? It is different to the
:13:22. > :13:27.global financial crisis and what is going on just now. What I am clear
:13:28. > :13:31.is that we are doing relatively well, our April the growth is
:13:32. > :13:36.addicted to be the strongest amongst major Western economies. Clearly we
:13:37. > :13:40.have to make adjustments for the fact that growth is not predicted to
:13:41. > :13:44.be quite as strong as it was in November, which is one of the
:13:45. > :13:50.reasons we are making savings. George Osborne has said the deficit
:13:51. > :13:53.will be wiped out by 2020, leaving aside the fact he predicted it
:13:54. > :13:58.should have been wiped out by last year and did that deliver on that,
:13:59. > :14:03.bearing in mind the slowing economy and concerns that go with it, many
:14:04. > :14:08.are saying that is not the right priority, that you should be looking
:14:09. > :14:10.to invest instead and kick-start the economy. Is your obsession with that
:14:11. > :14:20.target becoming unhealthy? It is we are investing, we have
:14:21. > :14:24.longed a lot of extra initiatives today in all kinds of different
:14:25. > :14:29.areas of the economy. But you're making real cuts in real terms?
:14:30. > :14:32.Bill-mac we are delivering the surplus that we always said we would
:14:33. > :14:37.deliver in 2019. We are still on track, that isn't just us saying
:14:38. > :14:41.that, that is the Independent 's office of Budget response ability.
:14:42. > :14:45.It is important to deliver that surplus to reduce the deficit and to
:14:46. > :14:48.fix the roof of the Sun is shining and make sure that we start to bring
:14:49. > :14:52.debt down in this country. What a great record in bringing the deficit
:14:53. > :14:56.down, now we bring the debt down as well. But there is clear signs that
:14:57. > :14:59.the growth is stuttering, the obvious way to boost output is to
:15:00. > :15:03.spend on capital investments and yet you're looking to do the opposite.
:15:04. > :15:08.I do not think that it's there. I think we are spending a lot of
:15:09. > :15:12.money. If you look at the way back forward over the next four years, we
:15:13. > :15:16.are spending something in the region of almost ?4 trillion of public
:15:17. > :15:22.money, a lot of money is being invested in transport, in schools, a
:15:23. > :15:24.lot of these things will suit apart a consequence was flowing to
:15:25. > :15:28.Scotland, there's a lot of investment taking place.
:15:29. > :15:33.We are able to deliver because of her sound economic management, some
:15:34. > :15:38.tax, which book benefit the economy as well, and some personal income
:15:39. > :15:42.tax that are important, company income tax cuts as well, a boost for
:15:43. > :15:46.70,000 companies across Scotland and I think it will be good things for
:15:47. > :15:51.the Scottish economy. By me ask you about those tax cuts.
:15:52. > :15:57.It sets out your priorities and yet when money is short you might expect
:15:58. > :16:01.those tax cuts to be targeted at those who needed the most, without a
:16:02. > :16:04.mind, why are you raising the threshold for the higher rate of
:16:05. > :16:10.tax? That is a hand-out to the better off, is it not?
:16:11. > :16:15.No, I disagree. We are here, we are talking about raising the threshold
:16:16. > :16:21.for people earning ?43,000 to raise it to ?45,000. Those are classic
:16:22. > :16:25.middle-class and middle income earners. This will benefit a lot of
:16:26. > :16:29.people. I think 14,000 people will be taken out of higher rates of
:16:30. > :16:35.income tax in Scotland. But also what we're doing is the personal
:16:36. > :16:39.allowance which really does have a positive impact for those who are
:16:40. > :16:44.low earners, we are taking across the UK 1.3 million people out of tax
:16:45. > :16:49.altogether, 60,000 of those are in Scotland. We will taking out of
:16:50. > :16:55.income tax altogether. That is a big tax cut, critically for the low pay.
:16:56. > :16:59., But just focusing on that tax cut, for those on a higher rate of tax,
:17:00. > :17:05.it grates for some because at the same time you're looking to cut
:17:06. > :17:07.billions of pounds on public services and reducing health for
:17:08. > :17:11.people with disabilities. I wonder if you have your priorities
:17:12. > :17:16.right. We think it is the right thing to do. Thanks to our sound
:17:17. > :17:20.economic management of the UK economy, we are able to do that and,
:17:21. > :17:25.by the way, when it comes to spending on the disabled, we will
:17:26. > :17:29.deliver more on Main disability benefits, so the Disability Living
:17:30. > :17:32.Allowance, which is now being replaced by the personal
:17:33. > :17:36.independence payments, the amount spent on the disabled through the
:17:37. > :17:39.main benefits will be higher in every year of this Parliament than
:17:40. > :17:44.it ever was under Labour. So we are making a big commitment to
:17:45. > :17:46.supporting the disabled. There we must leave it. Thank you
:17:47. > :17:49.very much. On College Green, we have three
:17:50. > :17:52.Westminster politicians braving the cold for us -
:17:53. > :17:54.the SNP Deputy Leader and Treasury Spokesperson
:17:55. > :17:57.Stewart Hosie. For Scottish Labour,
:17:58. > :17:59.the Shadow Scottish Secretary And for the Liberal Democrats,
:18:00. > :18:11.Jeremy Purvis, or to give him his Thanks very much indeed for joining
:18:12. > :18:16.us. Stewart Hosie, the Chancellor has delivered extra help for the oil
:18:17. > :18:22.industry, on sugary drinks and a tax cut for people on lower incomes. Is
:18:23. > :18:27.this Budget along the right lines? Well, some of the announcements on
:18:28. > :18:31.the whisky, fuel, oil, are to be welcomed, not least because the call
:18:32. > :18:35.for them and that is great as far as it goes, but at its heart, this
:18:36. > :18:38.Budget was one of unmitigated failure.
:18:39. > :18:40.Every major number the Government has set for themselves, they failed
:18:41. > :18:45.him. To hear the chief Secretary
:18:46. > :18:48.recognised growth is forecast down, productivity is awful, but they are
:18:49. > :18:52.doing the right things, they are doing precisely the wrong things.
:18:53. > :18:56.In the business department, which helps business and productivity, has
:18:57. > :18:59.had its budgets cut again for every year of this forecast.
:19:00. > :19:03.UK TI to help with exports and inward investment has had huge cuts
:19:04. > :19:06.to its Budget announced last autumn. I don't think the Government
:19:07. > :19:10.actually knows what they're doing and the things they are doing, with
:19:11. > :19:13.one or two small exceptions, are completely wrong.
:19:14. > :19:18.And yet the Chancellor did spell out that, according to the OBR, the UK
:19:19. > :19:25.economy is grow and grow and grow at a rate which is higher than pretty
:19:26. > :19:28.much any other country in Western and industrialised nations.
:19:29. > :19:31.That is not a pitcher of utter failure, is a?
:19:32. > :19:35.It is not a picture of glowing good health, because other companies are
:19:36. > :19:38.doing even worse. The truth is, these are the facts, they are in the
:19:39. > :19:43.red box, road forecast has been marked down for every single year in
:19:44. > :19:46.the forecast period. The fact that we're doing marginally better than
:19:47. > :19:50.some other countries on some measures is no great success for
:19:51. > :19:54.this Tory government. But speak later, the Barnett
:19:55. > :19:59.consequential 's mean the Scottish Budget, the Scottish Government
:20:00. > :20:02.Budget, will get a bit of ?650 million.
:20:03. > :20:08.Is a figure I've already heard today. I've yet to try to set it up,
:20:09. > :20:12.it barely does, digs into the cuts we've seen over the past five years,
:20:13. > :20:16.the past ten years. But if it's there, it's welcome. One thing to
:20:17. > :20:20.bear in mind, much of that will be gobbled up by the extra national
:20:21. > :20:24.insurance cost to the Scottish Government and local authorities.
:20:25. > :20:29.It's a double edged sword. Ian Murray, it's clear that the economy
:20:30. > :20:35.is not back to where it was before the financial crisis with Labour
:20:36. > :20:39.were in charge. The Chancellor says he is still clearing up the mess
:20:40. > :20:43.that Gordon Brown left behind. He's got a point, hasn't he? This was a
:20:44. > :20:47.groundhog day Budget from this Chancellor, because as Jeremy Corbyn
:20:48. > :20:51.seven the first EU minutes of his response it, he's bailed on the
:20:52. > :20:57.deficit, the debt, the productivity, exports, cutting inequality and more
:20:58. > :21:02.so he sailed on the very poorest in this country. So I don't accept that
:21:03. > :21:07.at all. He promises country in 2010 that he would eradicate the deficit
:21:08. > :21:13.by 20 16, he would pour out 20 million this year, 30 billion over
:21:14. > :21:17.the course of this, and he said back in his Autumn Statement in November,
:21:18. > :21:20.this is a Chancellor of complete failure who is passing budgets at
:21:21. > :21:23.the dispatch box, a political Chancellor who was more intent in
:21:24. > :21:26.getting into number ten that he is on delivering a Budget for the
:21:27. > :21:29.country. After the global financial crisis,
:21:30. > :21:35.how can you expect him to deliver an economy which is in glowing health
:21:36. > :21:39.in just a matter of a few years? This is a decade-long effort or
:21:40. > :21:43.more. That's what he promised to do in
:21:44. > :21:48.five years. If you're a member back to 2010, Alistair Darling's plant
:21:49. > :21:50.when he was still the Chancellor of the Exchequer was too half the
:21:51. > :21:54.deficit in five years in order to not take all the money out of the
:21:55. > :21:56.economy that stops stimulus and growth and productivity.
:21:57. > :22:01.With this Chancellor 's doing, he's on the slippery slope to austerity,
:22:02. > :22:07.the slippery slope to a decade of us are ready, because he taken far too
:22:08. > :22:09.much money out of the economy which has struggled growth. That happened
:22:10. > :22:13.all over the world and all the other countries try to get out of this
:22:14. > :22:17.particular worldwide economic problems have put stimulus into the
:22:18. > :22:20.economy to invest and build on the future and to make sure the growth
:22:21. > :22:24.of the economy as sustainable and long-term.
:22:25. > :22:28.He has downgraded his growth by 0.3% just since November last year.
:22:29. > :22:31.That's a damning indictment of his policies and chose the policies he
:22:32. > :22:36.is pursuing in the economy is making the problem worse.
:22:37. > :22:40.Jeremy Purvis, Europe party, the Liberal Democrats, was in Government
:22:41. > :22:44.with the Conservatives until quite recently. -- your party. I wonder if
:22:45. > :22:47.we are seeing more of the same from the Chancellor, the same tough
:22:48. > :22:49.measures, the spending cuts when we got used to when you're in office as
:22:50. > :22:53.well. There was a small part that is the
:22:54. > :22:55.same. That is with the personal allowance at the start.
:22:56. > :23:00.But I think this is a Budget where the clear differences can now be
:23:01. > :23:04.seen. We absolutely would not have raised the allowance for those
:23:05. > :23:08.earning high wages. In Scotland, we prefer to use the
:23:09. > :23:12.new powers for a new Scottish zero rate because we think, if there is
:23:13. > :23:17.to be any tax break, it should be for those who are working very hard
:23:18. > :23:20.when prices are high and they need a break.
:23:21. > :23:22.We would also argue, we did separate from the Conservatives that the
:23:23. > :23:26.general election, we would also argue that there is to be much more
:23:27. > :23:31.considerable investment, so where the SNP and the Conservatives are
:23:32. > :23:34.joined together with refusing or considerable investment for the
:23:35. > :23:38.future of the Scottish economy, we are now signalling that we need to
:23:39. > :23:43.see that form of investment in the Scottish context, ?475 million
:23:44. > :23:47.figure with an increase of 1p on an income tax and scholar, so we didn't
:23:48. > :23:48.see the kind of mechanisms, the kind of investment that is needed to grow
:23:49. > :23:54.the economy. The very modest forecasts of growth
:23:55. > :23:59.in the economy demonstrate the fact that austerity simply doesn't work.
:24:00. > :24:03.To grow the economy to the significant amount that we want to
:24:04. > :24:07.see. That is why, in a Scottish context, we are signalling for the
:24:08. > :24:09.future of the Scottish in a different direction.
:24:10. > :24:15.I wonder if you try to rewrite history, your party back spending
:24:16. > :24:19.cuts austerity, while you were in power. And have to stay in coalition
:24:20. > :24:22.with the Conservatives. It is not done very much for the economy. The
:24:23. > :24:28.economy is still in rough shape, isn't it?
:24:29. > :24:31.Let you, being the BBC, the accurate about history. When the coalition
:24:32. > :24:35.started, the personal allowance was just over ?6,000. Now it's double
:24:36. > :24:37.that because of the Liberal Democrats who were in the coalition
:24:38. > :24:43.that forced up through. The Conservatives have adopted that,
:24:44. > :24:45.the Labour Party did not have a policy, the SNP did not support that
:24:46. > :24:48.policy. The only supported the personal
:24:49. > :24:53.allowance at the low rate only growing by inflation.
:24:54. > :24:56.So the biggest ever increase in the personal allowance for those who are
:24:57. > :25:00.low and middle earners in Scotland is because of the Liberal Democrats,
:25:01. > :25:03.I'm not rewriting history. I'm only saying that the future requires
:25:04. > :25:05.investment that is why it is our top priority for the Scottish elections
:25:06. > :25:12.coming up. Ian Murray, where does your party
:25:13. > :25:14.stand on these tax cuts for middle income earners, people earning up to
:25:15. > :25:19.?45,000? Would you like to see them reverse?
:25:20. > :25:23.We have said and set out already some of their bold plan to use the
:25:24. > :25:26.income tax powers that are currently at the Scottish Parliament in the
:25:27. > :25:31.full powers for income tax that are coming in 2017. We would put 1p on
:25:32. > :25:34.income tax, protect the lowest paid on that basis apply the money into
:25:35. > :25:37.making sure that we can protect Scotland's future, that's quite
:25:38. > :25:40.clear. As an MP at Westminster, what would
:25:41. > :25:45.you do, would you like to see that middle income tax cuts reversed? The
:25:46. > :25:49.one announced today by the Chancellor, the ?42,000 to ?45,000
:25:50. > :25:52.tax cut. We have said are ready in the
:25:53. > :25:56.Scottish context. That was one of the plans we put forward. When faced
:25:57. > :26:00.with a choice between cutting into Scotland's future or using the
:26:01. > :26:04.powers that Scotland has, we all fall on the panel to get the
:26:05. > :26:08.Scottish Parliament degree is power. As Parliament, we should use the
:26:09. > :26:11.powers to get away from the spine of austerity, to have an honest error
:26:12. > :26:14.in the Budget, to invest in the future and that is the way you grow
:26:15. > :26:16.your economy and that is the way you get out of this form of debt and the
:26:17. > :26:19.deficit. That's the way to do it. At
:26:20. > :26:24.Westminster, you're not when the change that. You will be that tax
:26:25. > :26:28.cut for the middle classes in place, that is clear, isn't it?
:26:29. > :26:31., I don't know if that is clear, I'm talking about the Scottish context
:26:32. > :26:35.because Colin will have the entirety of its income tax. It was a historic
:26:36. > :26:38.day here at Westminster because this is the last time a Chancellor will
:26:39. > :26:41.come to the dispatch box and actually set the income tax rates in
:26:42. > :26:45.Scotland because by the 1st of April last year, it will be the entirety
:26:46. > :26:46.of the income tax at the Scottish Parliament and we will make a bold
:26:47. > :27:01.choice to make sure we get out of the spinal of austerity
:27:02. > :27:03.invest in the future of Scotland that's what's important.
:27:04. > :27:05.Stewart Hosie, with these new tax powers coming soon to Holyrood, it
:27:06. > :27:08.represents a big political choice. Would you reversed those cuts? We
:27:09. > :27:10.will publish a manifesto in about a month's time.
:27:11. > :27:12.But let me be clear today. To increase the 40p threshold, way
:27:13. > :27:16.above the rate of inflation, many times the rate of inflation, the
:27:17. > :27:19.same day that the Government are emitted to taking billions from some
:27:20. > :27:22.of the most honourable disabled people in the country is almost
:27:23. > :27:28.certainly wrong thing to do. I think today we sought evidence of the,
:27:29. > :27:32.certainly the return of the nasty party from George Osborne.
:27:33. > :27:35.There will must leave it. Thank you all very much indeed.
:27:36. > :27:38.Now with me this evening to give us political analysis on today's
:27:39. > :27:41.events' is Paul Sinclair, who's a former advisor
:27:42. > :27:49.and Andy Collier, who is an SNP advisor.
:27:50. > :27:57.Thank you both very much for joining us. I want to ask you both, first as
:27:58. > :28:02.people who know how politics works from the inside, it's hard, isn't it
:28:03. > :28:08.homage to be a Chancellor who has to cut spending and walk this
:28:09. > :28:11.tightrope? How well has George Osborne managed to?
:28:12. > :28:16.It was a squirrel Budget. Look over there, don't look at my economic,
:28:17. > :28:19.don't look at my growth forecast, my boring forecasts and have you seen
:28:20. > :28:31.the new sugar tax? I think over the next few days, that will fall apart.
:28:32. > :28:35.-- my Boro wing forecasts. Some the ways you admire George Osborne's
:28:36. > :28:40.tactics but is taken away disability allowance the exact same amount that
:28:41. > :28:46.cost him to cut tax from people at 40% to cut capital gains tax. Is the
:28:47. > :28:50.Tory internal trap and it will be quite interesting to see the
:28:51. > :28:54.atmosphere of the House of Commons after the way they made them reverse
:28:55. > :28:59.their working family tax cut and whether they rebel again. There was
:29:00. > :29:02.that measure, there was also that eye-catching levy on sugary drinks.
:29:03. > :29:05.We know George Osborne has tried flashing measures before. Sometimes
:29:06. > :29:09.successfully, sometimes it gone wrong. Where do you think it will
:29:10. > :29:16.work this time? I think it's quite a good measure in
:29:17. > :29:18.a sense. One very small thing is diabetic people need sugar medically
:29:19. > :29:25.quite often and they're not going to be happy about this when it's a
:29:26. > :29:29.medical need. It's a clever move, I think what he's done here is gone
:29:30. > :29:35.for the headline grabbing, gone for something which, people say, yes,
:29:36. > :29:39.this is really good, it's a sensible thing to do, it's helping health,
:29:40. > :29:45.while the focus on that, to an extent, some of the
:29:46. > :29:53.Is that part of the trick? Highlight something like that and get the
:29:54. > :29:59.headlines focusing on that and leave the detail in the undergrowth? Yes,
:30:00. > :30:03.but members when Gordon Brown in his last budget cut the basic rate of
:30:04. > :30:09.income tax to undermine the Tories and to do so got rid of the 10p tax
:30:10. > :30:13.rate, which ended up in a huge difficulty, and I think Osborne is
:30:14. > :30:22.ending up in difficulty again. He has half an eye on the Prime
:30:23. > :30:28.Minister to campaign and half and I on the U reference. It is a tricky
:30:29. > :30:33.one for him. Has he managed to keep everything going? I think he has
:30:34. > :30:39.delivered a solid if unspectacular typical Tory budget that will appeal
:30:40. > :30:43.to his backbenchers and will appeal to Tory members and Tory voters in
:30:44. > :30:50.middle England. If you happen to be looking at the budget and you are on
:30:51. > :30:53.low pay or benefits or welfare in an urban centre in Scotland it will
:30:54. > :31:00.look a lot less attractive. More broadly, does it appeal to voters in
:31:01. > :31:04.the nations and regions and areas where people will have elections
:31:05. > :31:08.over the next few months? I don't think so, but he has a bigger
:31:09. > :31:11.problem in that only one of his fiscal rules is standing, that he
:31:12. > :31:16.will have a surplus in the last year. Look at the red book, it is
:31:17. > :31:21.very odd. Difficult to see how he could do that, is he presuming he
:31:22. > :31:24.will be Prime Minister by then? If he does not deliver that or it does
:31:25. > :31:30.not like that he has shot himself in the foot. There has been a long
:31:31. > :31:38.narrative that the Conservatives have taken advantage of that the
:31:39. > :31:41.problems in the economy were caused by Labour as this excess. Gee, how
:31:42. > :31:46.long can they maintain that narrative? I think it is already
:31:47. > :31:52.starting to run out because the further we get away, the more the
:31:53. > :31:57.Conservatives have to take responsibility for the economy as it
:31:58. > :32:01.stands. 'S from the Brown years. It is looking bleak going forward for
:32:02. > :32:04.George Osborne and the UK economy and this budget has been an
:32:05. > :32:08.admission of failure, but some of the real problems will not come home
:32:09. > :32:14.to roost until the end of the decade. I suspect he is hoping his
:32:15. > :32:17.political acumen will carry him through and if he becomes Prime
:32:18. > :32:21.Minister he can send another chance to deal with those things five years
:32:22. > :32:28.down the line. These choices on tax have a knock-on impact here and I
:32:29. > :32:34.wonder on income tax, it does leave a conundrum. We thought Stewart
:32:35. > :32:38.Hosie not committing the SNP to any position on income tax, we do think
:32:39. > :32:44.they will go with it? I suspect it will fluff the question. You are
:32:45. > :32:49.talking about a budget in a year's time after the election, I suspect
:32:50. > :32:54.they will buy themselves time. What this could potentially do is help
:32:55. > :32:57.Ruth Davidson, because she will presumably say she does not want tax
:32:58. > :33:00.rates to be different north and south of the border and I don't
:33:01. > :33:05.think the SNP will give a straightforward answer one way or
:33:06. > :33:10.the other. What do you reckon? Way to the SNP go with that in promising
:33:11. > :33:16.to raise taxes, it's never a popular, would they do that? I have
:33:17. > :33:19.no inside knowledge but I can speculate that they will not raise
:33:20. > :33:25.basic rate tax, Nicola Sturgeon said that signal strongly last weekend
:33:26. > :33:30.and my suspicion is when they get the power the 40p rate they will
:33:31. > :33:34.hold it where the Ark, so you will start seeing a discrepancy on both
:33:35. > :33:37.sides of the border. And that might help Conservatives? Will have to
:33:38. > :33:41.wait and see on that. There we must leave it. Thank you both.
:33:42. > :33:45.That's it for tonight for the Budget special programme.
:33:46. > :33:50.So join her then, usual time, bye bye.