Queen’s Speech – RICS Scotland welcomes construction potential of Scotland Bill

Britain Queen's SpeechRICS Scotland has urged the Scottish Government to take advantage of the range of new powers provided by the Scotland Bill to maintain its “commendable” construction record.

Under the new plans announced in yesterday’s Queen’s Speech, the Scottish Parliament is to receive new devolved powers to raise 40 per cent of taxes and decide about 60 per cent of public spending.

The proposed Scotland Bill will allow Holyrood to set thresholds and rates of income tax on earnings in Scotland and is set to give the Scottish Government new welfare powers worth £2.5 billion, enabling it to vary the frequency of Universal Credit payments in Scotland and providing power to set the rules over a range of benefits which affect carers, disabled people and the elderly. Control will also be given over programmes which help people find work.

A portion of VAT and the whole of Air Passenger Duty will also be under the parliament’s control while the Barnett Formula, which determines the money the devolved Scottish Government receives, will be reduced.

The Queen’s Speech explained: “To implement the Smith Commission, a new fiscal framework for Scotland will be negotiated alongside the Bill.

“This should ensure Scotland enjoys the benefits of economic decision making closer to home within a strong and secure UK system and shared UK currency.

“The Barnett formula would be retained but would account for a smaller share of the Scottish Parliament’s revenues because more than half of it would now be raised by tax decisions made at Holyrood.”

RICS said it believes the Scotland Bill promises to help deliver a more consistent economic and construction strategy for Scotland.

Sarah Speirs, director RICS in Scotland, said: “RICS, with a commitment to the land, property and construction sectors, would like to see strong Governmental leadership that grows confidence and supports sustainable economic growth. We believe the Scotland Bill can enable a greater level of leadership through the provision of a coherent range of new powers. RICS welcomes the greater level of responsibility and accountability that the Scottish Parliament will have should the Scotland Bill become an Act.

“The transferral of Air Passenger Duty, which the Scottish Government has intimated will be cut then removed completely over time, will be welcomed by the business and tourism communities.

“With elements of the welfare system being devolved, coupled with the potential for the Scottish Government to introduce new benefits, RICS believe that this could have a knock-on effect on the overall housing budget. However, with additional borrowing powers and greater fiscal autonomy – through recouping some of the VAT receipts and income tax revenue - also being agreed between the UK and Scottish Governments, investment in affordable housing to meet demand could be extended, not inhibited.

“RICS is also keen that the new fiscal framework for Scotland is aimed at supporting Scottish SMEs, which make up 70 per cent of our membership, and capital investment in infrastructure.

“The Scottish Government has a commendable record on construction and infrastructure investment, and we hope the government administrations will use the Scotland Bill provisions, when enacted, continue to improve confidence in the construction sector.

“Construction and infrastructure are vitally important to the Scottish economy and competitiveness, and must be supported to enhance Scotland’s reputation as an attractive arena for investment – for both internal and external investors.”

The Federation of Small Businesses (FSB) welcomed elements of the Queens’ Speech which it said could make progress on issues such as cutting red tape, overdue payments to small businesses and increasing the number of apprenticeships.

Commenting on the Enterprise Bill, John Allan national chairman at the FSB, said: “We are pleased the UK government is maintaining focus on small businesses. Our members have been very clear on the need to cut burdensome red tape and on addressing issues like the billions owed to small businesses in overdue payments. The Enterprise Bill is a real opportunity to make progress on these issues.

“When setting out to tackle the burden of red tape, it’s important not only to identify obstructive regulations, but also look at how regulation is enforced. Poor enforcement or excessive monitoring requirements can turn straightforward regulations into costly and disruptive burdens.

“We look forward to seeing the details of the proposed Small Business Conciliation Service and how it will address issues like late payments. Small businesses often have the law on their side, but find accessing the legal system complex, time consuming and expensive. A properly constituted conciliation service should help with this and go some way to addressing major problems like the UK’s poor payment culture.”

On the Full Employment and Welfare Benefits Bill, John Allan added: “As we approach full employment the task of finding staff with the skills a small business needs will become more of a challenge. The measures in the Employment Bill to support more apprentices will help. But the issue is not only about the number of apprentices. The aim must be to make our apprentice system the world’s best, matching in quality to that offered in Germany, and offering a rewarding vocational alternative to academic routes.

“The only way to significantly increase the number of apprentices is to improve take-up among the UK’s 5.2 million small businesses. This requires government to make it crystal clear what the benefits are, and what support is available. They must be affordable, have standards based on current industry practice, and the quality of training must give confidence to employers that apprenticeships will produce the skills they need for the long term.”

Scottish secretary David Mundell said the legislative programme laid out in the speech “means positive change for people across Scotland”.

The Scotland Bill will be introduced shortly and will deliver the recommendations of the Smith Commission on further devolution.

Other measures affecting Scotland include a focus on energy security and support for the North Sea oil and gas sector and moves to tackle extremism and strengthen counter-terrorism. The legislative programme also includes measures on immigration controls and an EU Referendum.

The National Insurance Contributions Bill/ Finance Bill also includes a commitment to ensure there are no rises in income tax rates, VAT or National Insurance contributions for the next five years.

Mr Mundell said: “Scotland’s future is on a better footing thanks to the government’s ambitious programme with measures to create jobs and support working people at the heart of our plan.

“We are delivering quickly on further devolution by giving the Scottish Parliament wide-ranging new powers. That means Scotland will have a huge amount of flexibility to make its own decisions while keeping the many advantages of being part of the UK. The Scottish Government must now be clear on how it intends to use both these and its existing powers in the interests of Scotland.”

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