Listen
Fossil fuel flexibility
31/03/2010
First Minister Alex Salmond has described as 'significant progress' a commitment given to him today by UK Chancellor Alistair Darling that the current UK Government will not seek to reduce the Scottish Parliament's 2010-11 budget if in Government after the forthcoming General Election.
The Chancellor also said that he is now willing to be flexible in relation to the Scottish Government's demands that almost £200 million of unspent cash in a green energy fund - Scotland's Fossil Fuel Levy - be released for spending on projects to help meet climate change targets.
However the FM has expressed 'dismay' at the Chancellor's refusal to consider a further acceleration of capital spending in 2010-11 in order to bolster the recovery process in Scotland.
Mr Salmond said:
"Two weeks ago, despite raising the issue of securing Scotland's 2010-11 budget with all three Westminster parties on a number of occasions, we had little or no indication that any of them were willing to guarantee the vital spending package approved earlier this year by the Scottish Parliament.
"Now, after my meetings with the Chancellor and two Shadow Chancellors, we have the certainty we were seeking from Alistair Darling and Vince Cable that, if in Government after the election, they will not reduce the Scottish Parliament's approved budget in the forthcoming year. George Osborne was unable to give such a commitment, only saying that he'd be prepared to put any potential cuts onto the following year's budget.
"We also now have a concession from the Chancellor that he recognises the case that we are pursuing on the Scottish Fossil Fuel Levy surplus, and that he is willing to be flexible in finding a way forward on our demands that the near £200 million fund be released to help meet climate change targets.
"This money is sitting unspent in an Ofgem account in London when it could be invested, now, on vital projects to develop renewables in Scotland. Current Treasury rules would penalise Scotland for investing Scotland's money in Scotland - an illogical and absurd state of affairs.
"I hope that Alistair Darling and his officials will now work quickly with the Scottish Government to resolve this anomaly and release the funds which will help open up vital new opportunities to make Scotland a leader in low carbon technologies, creating jobs and sustainable industries."
On the Chancellor's refusal to consider further accelerated capital funding for 2010-11, the FM said:
"I am dismayed that neither the Chancellor, nor his two shadows, can see the undeniable economic merits in allowing Scotland to accelerate around £350 million of its own resources from future years to the current year, deploying vital funds into the economy in order to bolster a currently fragile recovery and minimise the risk of a double-dip recession.
"It was the sensible thing to do last year and is clearly the sensible thing to do this year. The Scottish Government are doing everything within our current powers to boost the economy and build recovery, but damaging decisions like this from Westminster can undermine much of the good work that is taking place."
The FM met with Vince Cable and George Osborne on Tuesday morning and with Alistair Darling this afternoon.