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Benny Higgins spoke during today’s Environment, Climate Change and Land Reform Committee after he warned Scotland faces a “long haul” to fix the country’s economy following COVID-19. Referring to Nicola Sturgeon’s programme of government last week where she pledged a draft bill for a second independence vote, Mr Higgins said: “We have never lived in a time when it’s the execution of change that matters any more than it matters today.
“The test isn’t writing it down, the test is doing it.
“What we need to see in the country now is quick progress on the things that matter most to give us confidence moving forward.”
Mr Higgins stressed Scotland had to focus on jobs and education stressing he was “fearful” for young Scots.
During her Programme for Government last week, the First Minister announced the creation of a £100 million Green Jobs Fund and confirmed a Youth Guarantee scheme, which will see £60 million of Scottish Government cash help provide all those aged 16 to 24 with either a job or a place in education or training.
Also on jobs, a National Transition Training Fund will support up to 10,000 people at risk of redundancy or unemployment, she said.
Committee Convenor Gillian Martin MSP asked Mr Higgins: “Other countries have responded to their own economic situation, particularly post what we hope is the height of COVID by investing a percentage of their GDP in their green recovery.
“That seems to me, something that seems necessary – it’s going to take a lot of investment to get us out of this.
“Do you feel that the Scottish Government has got the levers to be able to do that?”
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Mr Higgins has previously referenced a report from his Economic Advisory Group which he chairs.
The report, released in June, has warned Scotland will need at least £6billion in stimulus money for the Scottish economy to recover from COVID-19, equal to 4 percent of GDP.
But Mr Higgins expressed doubt: “Four per cent of Scotland’s GDP is £6 billion and within the fiscal framework, we are restricted to £450 million which is 0.3 percent of GDP.
“So quite frankly, we don’t have the levers to invest the amount that would be reasonably required as a stimulus to come out of this crisis.
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“I don’t think it’s feasible for us to imagine that we could change the whole fiscal framework in a timeframe that is consistent with the emergency that we face.
“I think we somehow have to find a way to work with Westminster to either get them to invest something or find some other mechanism.
“There are lots of things we can do but at the heart of it we don’t have the capacity unilaterally in Scotland to invest even if it wasn’t four per cent but two per cent is £3 billion.
“These numbers at the moment are a long way away from the amounts being invested.
“We can talk about programmes, we can talk about a lot of things but we have to pay for them.”
The Advisory Group on Economic Recovery made 25 recommendations which included a programme for those aged between 16 and 25, guaranteeing two years of work paid at the real living wage.
The report also called on Nicola Sturgeon’s government to prioritise a green recovery, strengthening the relationship between business and government and investing in digital infrastructure alongside a VAT reduction to help the tourism sector.
Mr Higgins’ group also pushed for a faster revision of the fiscal framework between the Scottish and UK Governments – the agreement which sets out the funding arrangement north of the border – to allow for more autonomy in Scotland.
Speaking at the Committee, Mr Higgins stressed: “The specific areas where the spending needs to be done is in projects that will play their part in getting us to net-zero by 2045.
“It needs to be in training that prepares people of all ages but especially young people for the kinds of jobs that we can expect in the mid 21st century.
“The leading economies of the mid 21st century will be those that do focus on wellbeing, those that do focus on net-zero, those that have a green spine to their recovery from COVID and those that have trained and reskilled people of all ages, young and old, in preparing for what’s coming next.”
Referring back to the review, Mr Higgins had warned that Scotland faces an “economic challenge of monumental scale”.
The chairman of the advisory group added: “If we do not intervene radically to transform our economy, inequalities will drastically widen with long-term scarring for communities across the country, and for our young people in particular.
“This cannot be allowed to happen.”
Scotland’s Finance Secretary Kate Forbes and other Scottish ministers have repeatedly pushed for the flexibility to borrow more and to be able to move capital underspend over to day-to-day revenue spending.
During a visit to Edinburgh in July, the Chief Secretary to the Treasury said that a further £1.9 billion in funding had been given to the Scottish Government to see out the year and fund initiatives to tackle the effects of COVID-19 in lieu of granting more fiscal flexibility for Scotland.
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