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Meeting of the Parliament

Meeting date: Wednesday, May 24, 2023


Portfolio Question Time

Wellbeing Economy, Fair Work and Energy

The Deputy Presiding Officer (Annabelle Ewing)

Good afternoon. The first item of business is portfolio question time, and the first portfolio is wellbeing economy, fair work and energy. Again, I make a plea for succinct questions and answers, in order to allow as many members as possible to get in.

Question 1 was not lodged.

Wellbeing Economy (Rules and Incentives)

To ask the Scottish Government what its position is on what rules and incentives are central to a wellbeing economy. (S6O-02261)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

As we transition to a wellbeing economy, we will maximise the powers that are currently available to us, in order to grow a fairer, greener economy, seize the opportunities of net zero, create better communities, tackle poverty and embed equality, inclusion and human rights in everything that we do.

Our national strategy for economic transformation and our energy strategy, including our approach to fair work and conditionality, set out many of the actions and investments that we are taking forward to deliver that vision. We will continue to make the case that, with independence, we can do much more to realise our vision for a wellbeing economy.

Craig Hoy

A thriving local high street is vital to the wellbeing of communities and the economies in towns such as Dunbar, Haddington, Penicuik and Melrose, right across the South Scotland region. Can the minister explain how the decision to impose the disastrous deposit return scheme on cafes, pubs and restaurants is in any way sensible rule making? How can the Government’s abject failure to pass on the 75 per cent business rates relief to Scotland’s hospitality and retail operators be viewed as an incentive for them to grow and invest in a wellbeing economy?

Neil Gray

The hospitality and tourism industries are represented on the new deal for business group that I co-chaired along with Dr Poonam Malik last week, and we are taking representations on the non-domestic rates situation. Obviously, we have a very generous non-domestic rates offering, as well as the most generous small business bonus scheme anywhere in the United Kingdom, which helps to support our high streets.

With regard to the deposit return scheme, we are looking to develop a circular economy. It is important for our net zero journey, but if we can get recycling right, it is also an economic opportunity. We have a huge commodity in Scotland, and one of the central aims of the deposit return scheme is to harness that and take it forward well.

Support into Work (Parents)

To ask the Scottish Government what support it is giving to bring people with children back into work. (S6O-02262)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

Parental employment support seeks to increase parental income from employment. Our eligibility recognises different family structures, such as kinship carers and those who are parents but are not living with their children.

Responding to the fact that more than two thirds of children in poverty live in working households, we broadened eligibility to ensure that parents in low-income employment can access person-centred support to help them to increase their income.

We work with local partners to promote employment as a route out of poverty and to attract parents to the support that is available by ensuring that employment opportunities are fair and flexible to family circumstances.

Christine Grahame

I thank the cabinet secretary for his answer regarding local partners. Does the cabinet secretary have discussions or engagement with private and public sector employers regarding home working and, separately, regarding the provision, where practicable, of the 1,140 hours of free nursery care, including to home workers?

Neil Gray

Yes. Although the legal powers that govern flexible working are reserved to the United Kingdom Government, we remain committed to improving access to flexible working in all sectors of the economy. We welcome the progress of the Employment Relations (Flexible Working) Bill through the UK Parliament, but we feel that it does not go far enough in giving all employees and, therefore, employers confidence that requests for flexible working will be given thorough consideration.

Asking employers to offer flexible working from day 1 of employment has been a requirement of our fair work first criteria on public spend since October 2021 and, since August 2021, all councils have been offering 1,140 hours of funded early learning and childcare to all eligible children. The most recent ELC census shows that more than 92,500 children were accessing funded ELC across Scotland in 2022. The estimated uptake rate of funded ELC for three and four-year-olds was 99 per cent in 2022. We will continue to work closely with local government to embed the benefits of expansion as more families come forward, to ensure that childcare is flexible, affordable, accessible and high quality.

Beatrice Wishart (Shetland Islands) (LD)

Private and voluntary nurseries are often able to offer a greater degree of flexibility in childcare hours than local authorities, which is especially important for shift workers such as nurses. However, the funding model undermines their ability to retain experienced staff in the sector, especially during a cost of living crisis and with increasing pay levels. When will we see a change to help people with children who wish to return to work?

Neil Gray

I have received representations from the PVI sector, and I know that Natalie Don has met representatives of the PVI sector to discuss the issues that Beatrice Wishart raises. I hope to meet PVI representatives soon as well, so that we can cement the fact that a strong childcare provision is central to our economic aspirations. I will look to provide an update as soon as I can.

Just Transition (Offshore Workers)

4. Mercedes Villalba (North East Scotland) (Lab)

To ask the Scottish Government what discussions the energy minister has had with ministerial colleagues regarding the recommendations to the Scottish Government contained in the report, “Our Power: Offshore Workers’ Demands for a Just Energy Transition”. (S6O-02263)

The Minister for Energy (Gillian Martin)

The Scottish Government welcomes the report and agrees that listening to and acting on recommendations from offshore workers is critical to ensuring a just transition. That is why we have provided £100,000 in funding to the Scottish Trades Union Congress, to ensure that workers’ voices are at the very heart of our just transition planning.

My colleague, the Cabinet Secretary for Net Zero and Just Transition, advised that the recommendations that are provided in the report would be considered in full during the consultation period for the “Draft Energy Strategy and Just Transition Plan”, and responded to in the final draft. A range of ministers will continue to work closely together on that, given that it requires cross-portfolio and cross-sector working.

Mercedes Villalba

The minister will be aware that a key demand from offshore workers in the “Our Power” report is that the Scottish Government create an offshore training passport that aligns standards across the energy industry. That passport has already been delayed by the Government and, just today, the general secretary of the STUC warned the Government to “get to grips” with the transition.

Can the minister reassure offshore workers and their trade unions that the energy skills passport will align offshore basic safety, sea survival and firefighting standards? I am looking for a cast-iron guarantee from the Government on this point. Will those standards be aligned—yes or no?

Gillian Martin

I thank Mercedes Villalba for bringing up the offshore skills passport, because I want to say that it has not been delayed by Government. An industry-led body is taking it forward, and the Government’s role is to help to fund it. We have awarded £5 million from the just transition fund to OPITO, which is leading on the digital energy skills passport. A key milestone was reached with the development of a prototype, which I have seen.

Mercedes Villalba will know that, in addition to the report that she cites, I did my own report on the issue, and it came out loud and clear that, for anything to do with an energy skills passport, the industry and sectors have to be at the heart of it. I am meeting OPITO next week to see what progress has been made.

Liam Kerr (North East Scotland) (Con)

Yesterday’s energy transition report highlighted how damaging to a just energy transition this Government’s demonising of the North Sea oil and gas industry is. That was epitomised by minister Patrick Harvie saying that only the “hard right” supports new oil and gas. Does the minister recognise the report’s findings, will she amend the energy strategy to stop the damage that it is doing to our industry, and will she join us in supporting domestic oil and gas exploration and production?

Gillian Martin

I was smiling as Liam Kerr delivered his question, because he knows full well that I very much have a foot in every part of the energy mix. My interest in keeping the energy mix vibrant, working and employing people until we transition is very much something that I prioritise.

Liam Kerr refers to the energy strategy, the consultation for which has closed. It will be reported on in the coming months. I am actively involved, along with my cabinet secretary and other cabinet secretaries, in looking at that and at how we can give confidence to all energy sectors that the Scottish Government fully supports them and their workers.

Community-owned Energy Generation

To ask the Scottish Government what action it is taking to expand community-owned energy. (S6O-02264)

The Minister for Energy (Gillian Martin)

We want to realise as many opportunities as possible for community energy and lasting benefits for communities from the transition to net zero.

Scotland has made good progress against its 2GW community and local energy target, and we continue to invest in our community and renewable energy scheme—CARES—which has, to date, provided more than £60 million in funding for communities and has supported shared ownership opportunities.

We have recently commissioned research to explore how we maximise the contribution of community energy to a just transition. That will inform future policy development and the support that is provided through CARES.

Colin Smyth

The Government’s “Draft Energy Strategy and Just Transition Plan” has a target of 2GW of community-owned energy generation by 2030, as the minister has mentioned, but a clear route map and the actions to deliver on that target are missing.

The Scottish Co-operative Party has set out 11 recommendations to double community energy from creating a new ring-fenced Scottish National Investment Bank fund that includes quotas for community energy when it comes to local authorities bulk buying energy. What new measures does the Government plan to take? Will the minister give careful consideration to the Co-operative Party’s proposals in the Government’s final energy strategy and just transition plan?

Gillian Martin

Colin Smyth could almost have been a fly on the wall in the meeting that the cabinet secretary and I have just been to with the onshore wind strategic leadership group, as that issue came up for discussion. We discussed how, through CARES, we can provide more support—particularly legal and financial support—to communities and build on the learning from other communities that have involved themselves in community energy projects in order to get more communities invested in those. That is one of the ways in which we must share learning, because communities are doing that work voluntarily and we need to give them as much support as possible.

The issue that the member raises is very much a live discussion. In fact, the discussion is probably still going on—we had to leave the meeting to answer questions here today. Our partners in that group will be discussing that issue, and we will report back on its recommendations.

Emma Harper (South Scotland) (SNP)

Recently, the British-Irish Parliamentary Assembly Committee C—the committee that deals with energy—which I am a member of, visited Penpont micro-hydro scheme as part of our current energy inquiry. The scheme provides community energy to the local area and is a great example of how community-owned energy works. Does the minister agree that we must see more schemes like that rolled out? Will she agree to visit Penpont, to meet the development trust that secured the project?

Gillian Martin

I thank Emma Harper for that intervention—and for her invitation, in particular. I was going to say that I would like to visit the project.

To return to my response to Colin Smyth, this is about learning from other communities that have been through the process and about how we can build on the support that is given and make it streamlined, better and more supportive for communities that are yet to make that investment.

Fair Work (Support for Public Bodies)

To ask the Scottish Government how it is supporting public bodies to implement fair work principles. (S6O-02265)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

Public bodies and their spending power are key to making Scotland a leading fair work nation. We have developed fair work first guidance to support all employers, which includes specific advice for public bodies.

We have engaged extensively with public bodies on removing barriers for racialised minorities, following the Scottish Parliament Equalities and Human Rights Committee’s 2020 report into race equality, employment and skills.

We recognise the important dual role that public bodies play as employers and stewards of public funds. Working with Scottish Enterprise, we have developed an online support tool for employers, to benchmark fair work practices and to receive tailored advice and resources.

Pam Duncan-Glancy

Colleges are public sector organisations, so they are expected to abide by the principles of fair work, too. City of Glasgow College is undertaking a series of compulsory redundancies in the absence of any guidance on good higher education governance. For weeks, the website has said that the publication is imminent. When will that guidance be published?

Neil Gray

I hope that that will come forward in due course.

For Labour to be taken seriously on fair work, it must be consistent. Although Pam Duncan-Glancy is, quite rightly, standing up for employees at City of Glasgow College, on Monday at Westminster we had the spectacle of more than 30 Labour Party members abstaining from the Strikes (Minimum Service Levels) Bill. It is no wonder that no one knows where Labour stands even on workers’ rights when Sir Keir Starmer could not even be there to vote on that bill, including on an amendment that would have seen Scotland being exempted from that legislation.

Maggie Chapman (North East Scotland) (Green)

Interesting developments in the fair work space are happening around the world, including mechanisms to break contracts and withdraw funding if poor labour conditions, data breaches or environmental offences are identified. Those include Germany’s Act on Corporate Due Diligence to Prevent Human Rights Violations in Supply Chains, which holds companies legally responsible for human rights abuses in the supply chain. The cabinet secretary will know well my support for tight pay ratios to close inequality gaps. With the devolved powers that Scotland has, what more can we do to ensure that public money does not go to those with wide pay ratios and those who do not pay sick pay and holiday pay for hourly contracted staff?

Neil Gray

With employment law being reserved, there are limits on the actions that we can take. However, we are committed to using all the levers that are available in order to drive fair work across Scotland. We already apply fair work first criteria to effect the positive change that we want to see through public sector funding. In the Bute house agreement and the national strategy for economic transformation, we committed to developing our approach to conditionality within the constraints of devolved competence, which will be a key focus for the next phase, when the real living wage and effective worker voice conditionality in grants is fully rolled out after July. Public sector funding should lever wider benefits, including the promotion of fair work, to support a sustainable and successful wellbeing economy over the long term.

Question seven has been withdrawn.

Brexit (Impact on Scottish Businesses)

To ask the Scottish Government what recent assessment it has made of the impact of Brexit on Scottish businesses. (S6O-02267)

The Cabinet Secretary for Wellbeing Economy, Fair Work and Energy (Neil Gray)

Scottish businesses continue to be held back by the United Kingdom Government’s disastrous Brexit policy. The latest business insights and conditions survey shows that 44 per cent of the Scottish businesses facing challenges with exporting in April blame Brexit directly. Red tape, bureaucracy and uncertainty have become the hallmarks of Brexit, with the UK experiencing the worst exports recovery in the G7. What is more, Brexit has also contributed to labour shortages and recruitment challenges in key sectors such as healthcare, transport and hospitality. Study after study finds that Brexit is bad for trade, bad for productivity, bad for the cost of living and bad for business.

Marie McNair

Brexit is failing businesses and damaging our economy. Even the old Brexit Party leader, Nigel Farage, has said that it has failed. Does the cabinet secretary share my concern that leaders of the new Brexit party, Keir Starmer and Anas Sarwar, do not even have the courage or vision to abandon Brexit? Given that 70 per cent of Scots think that Brexit is a disaster, they do not even need to lead. They should just follow and reverse Labour’s support for Brexit.

Neil Gray

Neither the contenders to be leader of the next Westminster Government, Keir Starmer and Rishi Sunak, nor their Scottish counterparts, Anas Sarwar and Douglas Ross, are willing to admit the extent of the Brexit disaster. While Labour and the Conservatives try to sweep the mess under the rug, violating the will of the people of Scotland, this Government understands that the only way to repair the damage is to change course and rejoin the European Union. If the UK Government, of whichever stripe comes next, does not do it then an independent Scotland will.

Daniel Johnson (Edinburgh Southern) (Lab)

Border effects reduce trade by as much as a third. That is what a 2015 meta-analysis conducted by the University of Michigan concluded. Indeed, there may be empirical evidence to that effect from Brexit, which we did not support. Has the Scottish Government asked the chief economist to form a view on the impact of border effects? Sixty per cent of Scotland’s outward trade, which is worth more than £50 billion, is with the rest of the UK. How much of that would we lose if a border was imposed between Scotland and the rest of the UK?

Neil Gray

I am looking forward to meeting Daniel Johnson in the coming weeks. I have offered such a meeting to all front-bench spokespeople across the chamber, so that I can share the economy prospectus paper with them. The paper has many of the answers to the questions that Mr Johnson raises.

How much? Give me a number.

Excuse me, members. Could we listen to the cabinet secretary’s response?

Neil Gray

In that report, Mr Johnson can see the plans that we have for cross-border trade. Of course, those are being hampered right now because of Brexit and the barriers that have been put up by the UK Government. We are looking to tear down 27 barriers to trade with the rest of the EU. Only independence can deliver that.

The minister cannot have it both ways. Breaking up is bad. Breaking up the United Kingdom would be bad, just as breaking up the European Union is bad. Why can the minister not get that? He is talking nonsense.

Neil Gray

No—there are huge opportunities that come from independence. I have spoken about the 27 barriers to trade that are currently in place because of Brexit. Of course there would be challenges in terms of cross-border trade with the rest of the UK, but we have an opportunity with the market in the European Union. That is currently being held back and, as I have already said, 44 per cent of businesses cite Brexit as the reason for that. We want to reverse that. We know that Labour and the Tories are on the same page regarding Brexit and our relationship with the European Union. Only independence will deliver us the reversal of Brexit and an independent Scotland rejoining the European Union.

That concludes portfolio questions on wellbeing economy, fair work and energy. There will be a short pause to allow the front-bench teams to change position before we move to the next portfolio questions.

Finance and Parliamentary Business

The Deputy Presiding Officer (Liam McArthur)

The next portfolio is finance and parliamentary business. As ever, if members wish to ask a supplementary question, they should press their request-to-speak buttons during the relevant question. There is quite a bit of interest in supplementaries, so I again make a plea for brevity in questions and in responses.

Local Wealth Tax

To ask the Scottish Government what its response is to the Scottish Trades Union Congress’s proposals for a local wealth tax. (S6O-02268)

The Minister for Community Wealth and Public Finance (Tom Arthur)

We welcome the STUC’s report and acknowledge its important contribution to the debate on tax policy. We believe in a fair and progressive approach to taxation through which those most able to afford it contribute more to sustaining public services, and we are also committed to a fair and fiscally sustainable form of local taxation.

Ariane Burgess

In Buckie, Speyside, Elgin and Forres, half of the land available for housing is owned by just five landowners. Does the minister agree that the land and wealth taxes that are highlighted in the STUC report could be a useful tool for tackling unequal land ownership, increasing the number of homes in rural areas and capturing for public benefit a share of the increase in land value that occurs when development is supported through the planning system?

Tom Arthur

The Scottish Government recognises that tax could be an important mechanism in addressing land ownership patterns and influencing the market. We are currently reviewing the evidence that has been provided in response to our recent consultation on the proposed land reform bill and we will assess that separately as part of our wider approach to tax policy. That will include consideration of representations from stakeholders on a land value tax. However, I note that the Scottish Government’s ability to implement such a tax is constrained by the devolution settlement and that the Scottish Land Commission, in its advice to the Scottish Government, did not propose a single land value tax.

Liz Smith (Mid Scotland and Fife) (Con)

What plans does the Scottish Government have to carry out a review of the efficacy of the whole tax system in Scotland, given the warnings that are set out by the Scottish Fiscal Commission in its recent fiscal sustainability report?

Tom Arthur

We continually keep our policies on taxation under review, and we take decisions as part of the annual budget process. Through our new deal with local government, we are committed to further collaboration and engagement with local government on local taxation. The Deputy First Minister will carry out further engagement on tax over the summer months, details of which will be provided in due course.

Artificial Intelligence (Scrutiny of Legislation)

To ask the Scottish Government whether it will propose scheduling parliamentary time to debate the potential role of artificial intelligence in the scrutiny of legislation. (S6O-02269)

The Minister for Cabinet and Parliamentary Business (George Adam)

I am happy to be able to say to Mr Whitfield that a debate on artificial intelligence is scheduled for Thursday 1 June. That will provide him with an opportunity to contribute his views on the issue. With any use of AI, we would have to ensure that the public, politicians and stakeholders agree and are aware of that and, more importantly, that we do not find ourselves all replaced in some kind of dystopian future.

Who says that we have not already been replaced?

I heard that point from Mr Johnson. All joking aside, it is important to note that the Scottish Parliament scrutinises all legislation.

I encourage the minister to ignore sedentary interventions from Mr Johnson.

Martin Whitfield

I am very grateful to the minister for his response. I have now discovered the power of lodging a portfolio question to get a debate.

The question of AI is very important. When the First Minister met the Conveners Group earlier today, he said that he was very open to committees asking about better scrutiny of legislation. What has the Scottish Government done to engage with AI in relation to creating and drafting legislation and reaching out to people who might be affected by that legislation?

George Adam

The Government considers it important to ensure that scrutiny remains sufficiently flexible to enable the Parliament to hold the Government to account in an efficient and effective manner. As I said, the public and other partners would need to be agreeable to our approach, so that they would not be surprised by any future use of AI in any shape or form. The technology would also have to be at a level at which we could trust it to deliver for us in a consistent way.

However, I recognise that parliamentary scrutiny should evolve as technology develops. I am therefore interested in hearing more about how AI might play a part in such scrutiny in due course.

Income Tax

To ask the Scottish Government what its response is to the latest data reportedly showing that a majority of Scottish taxpayers now pay higher income tax than those elsewhere in the United Kingdom. (S6O-02270)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

According to the Scottish Fiscal Commission’s December forecasts, 52 per cent of Scottish taxpayers will pay slightly less income tax in 2023-24 than they would if they lived elsewhere in the UK. That will have been the case for the sixth consecutive year. The commission will publish updated forecasts, which will incorporate the latest economic data, alongside the medium-term financial strategy tomorrow.

We have always prioritised a fair and progressive approach to taxation that balances the need to raise revenue with the impact on households and the economy. That approach has resulted in additional revenue from income tax being raised for the Scottish budget, with lower earners protected from higher taxes.

Murdo Fraser

I thank the cabinet secretary for her response, but I fear that the data that she cited from the Fiscal Commission is now out of date, given that the most recent data shows that anyone who earns more than £27,850—the majority of Scots—is now paying more tax than they would if they lived elsewhere in the UK.

I commend to the cabinet secretary a very interesting article in today’s Herald by her former ministerial colleague Ivan McKee, who is, of course, now a member of the Government in waiting on the back benches. In the article, he argues for the Scottish Government to make Scotland a more attractive place for workers to come to from other parts of the United Kingdom. I think that we all agree with that, but we all hear the difficulties of the business community, particularly those in sectors such as finance, in encouraging people to come here because of differential tax rates. How can we attract more people to come and work here if they feel that they will be punished with higher taxes to make up for Scottish National Party waste and financial mismanagement?

Shona Robison

Each year, we publish the distributional analysis of our income tax policy in order to transparently set out the impacts. That analysis is there for everyone to see. The median wage for 2023-24 that is used in that analysis is, of course, derived from independent forecasts from the Scottish Fiscal Commission.

It is clear from analysis by the Institute for Fiscal Studies that households with children in approximately the bottom third of the income distribution in Scotland will gain about £1,200 per year as a result of our tax and social security policies.

At the end of the day, this is all about choices. Had we followed the choices of Murdo Fraser, who backed Liz Truss, and emulated her tax-cutting policies, we would have had hundreds of millions of pounds less available for public spending, as he knows.

On Murdo Fraser’s final point, Scotland continues to have consistently positive net inward migration from the rest of the UK. Those are the facts, which stand in contrast to his earlier assertions.

We will continue to ensure that we balance the needs of households with the needs of public services. Through the summer, I will engage with people from a range of organisations in order to ensure that we listen to their views as we go towards setting the tax policy for next year’s budget.

I am, of course, happy to engage with any suggestions from Murdo Fraser or his colleagues. However, the budget has to balance. As the member knows, many of his colleagues come here and ask for more money, but any tax policies that the Tories put forward have to balance with the availability of resources for public spending.

I will need a bit more brevity in responses as well as in questions.

John Mason (Glasgow Shettleston) (SNP)

It appears that, for the Conservatives, the ideal world would have no tax, no schools, no hospitals and no roads. Does the cabinet secretary agree that if we want all those things, we need tax, and that tax is inherently a good thing?

Shona Robison

It is absolutely the case that the investment in public services that results from our tax policy, makes a vital contribution towards making Scotland a great place to live, work and do business. We have access to a wide range of social security payments and public services that go significantly beyond what is provided in other parts of the UK, including free higher education, free prescriptions and our flagship Scottish child payment.

The Scottish Fiscal Commission has estimated that our income tax policy will raise £1 billion of additional revenue in 2023-24. If the Tories want to put that at risk, they need to tell us what will be cut with a different tax approach.

Taxation Policy

To ask the Scottish Government what impact it anticipates that its taxation policy, including in relation to businesses, will have on the strength of the economy. (S6O-02271)

The Minister for Community Wealth and Public Finance (Tom Arthur)

A strong economy is vital to ensuring that the benefits of our tax policy choices are fully realised. That is why we launched our national strategy for economic transformation—NSET—in March 2022 to create a greener, fairer and more inclusive wellbeing economy.

Alongside that strategy, our new deal for Scottish business will provide an opportunity to discuss how our tax policy can support businesses and our communities and grow the Scottish economy.

We will continue to prioritise a fair and progressive approach to our tax policy and will carefully consider the impacts of our policies on taxpayers, households and businesses.

Pam Gosal

Scottish businesses face a real struggle. Despite the business rates revaluation, Scottish retail, hospitality and leisure businesses still face tax bills that are thousands of pounds higher than their English counterparts because the Scottish National Party refuses to provide the same discount as is available down south.

Does the minister accept that the lack of business rates discount makes it harder to do business in Scotland than elsewhere in the United Kingdom, especially when the base poundage rate is only 0.1p lower than the rate in England?

Tom Arthur

I thank Pam Gosal for highlighting the basic property rate, which is, indeed, lower in Scotland, in response to the number 1 ask of business organisations ahead of the budget, which was that we freeze the poundage.

Decisions around non-domestic rates and non-domestic rates relief are taken in the round at budget time and are set in the context of the priorities that we undertake to deliver through the budget.

I note that around half of RHL properties pay no rates because they fall below the threshold for the small business bonus scheme, which is the most generous of its type in the United Kingdom.

Following on from questions that were raised earlier, I would be keen to hear from the Conservatives where they would choose to obtain that funding from, if they wish for provision of further relief for that particular sector in future budgets. Where would the corresponding budget reduction be?

We commit all our consequentials in sum to the priorities that we set out in the budget. If members wish to see tax cuts, that will cost money; if they wish to see more money for local government, that will cost money; and if they wish to see further relief on non-domestic rates, that will cost money. To govern is to choose, and that is nowhere more apparent than when we set budgets.

As the Conservative Government in the United Kingdom is entitled to set its policies, we are entitled to set ours, in this Parliament. If the Conservatives, as an Opposition party here, want to engage constructively, I will be more than happy to do so, but they cannot just ask for spending: they must also identify where the corresponding reduction would be.

Again, we need greater brevity, particularly in responses. There are two supplementary questions; if members are brief, I will fit them both in.

Bill Kidd (Glasgow Anniesland) (SNP)

We are aware of the significant impacts of Tory tax policy on the economy, especially following the disastrous mini-budget last October. What assessment has the Scottish Government made of the impact of those decisions on Scotland’s economy, and can we agree that business and our economy more generally would be better served by full fiscal powers lying with this Parliament?

Tom Arthur

Persistent high inflation and the cost of living crisis are causing unprecedented drops in living standards. Brexit and the fiscal instability that has been brought on by UK Government decisions have made the problems worse.

I accept entirely that we are operating within broad local economic challenges, but a hard Brexit—which was a clear policy choice by the UK Government that is now supported the Labour Party—is inflicting untold damage on our economy. It is compounding the impacts that all countries are facing, and ultimately it is a consequence of reckless decision making by the UK Government. If we want to find ourselves in a position in which we are no longer subject to decisions that are taken against our interests by Governments that we did not vote for, I am afraid that the only means to achieve that is Scotland’s becoming an independent country.

A change that would benefit our struggling high streets would be to bring down the higher rate of non-domestic rates in line with England, so when will we see that change?

Tom Arthur

We have taken action following the Barclay review to move towards that. We introduced the intermediate property relief a number of years ago, which significantly reduced the number of businesses that are subject to the higher property rate. We have increased the threshold from £95,000 to £100,000 most recently, and, as per our manifesto commitment, we are committed to achieving that parity over the course of this parliamentary term.

Transient Visitor Levy (City of Edinburgh Council)

5. Sarah Boyack (Lothian) (Lab)

To ask the Scottish Government what its response is to the reported concerns of the City of Edinburgh Council that it could still be two years away from having the powers to implement a transient visitor levy. (S6O-02272)

The Minister for Community Wealth and Public Finance (Tom Arthur)

As part of the Government’s priorities for Scotland announced by the First Minister on 18 April, we are committed to delivering, subject to Parliament’s agreement, legislation giving councils the power to apply a visitor levy, if they choose to do so. Once any bill is introduced, the timetable for its consideration is, of course, a matter for Parliament.

Sarah Boyack

I thank the minister for that answer.

I have been calling for a levy for years now, so it is frustrating to see how long it is taking to get that action from the Scottish Government. The minister will be aware that many cities in Europe successfully operate visitor levies. The City of Edinburgh Council has well-developed plans to implement a levy, and it estimates that approximately £15 million a year could be raised to help to fund vital local services. Will the minister meet me and the City of Edinburgh Council to discuss the levy in detail and ensure that Edinburgh and, indeed, other areas in Scotland that want to do so can implement such measures as soon as they have the power to do so?

I would be delighted to do that.

Ben Macpherson (Edinburgh Northern and Leith) (SNP)

I am also supportive of a visitor levy in Edinburgh, as are many organisations, including from the business community.

However, good implementation and development are important, so does the minister agree that it is vital that we take the appropriate and necessary time to take a bill through Parliament and give the relevant councils that wish to utilise the power, and stakeholders, adequate time to prepare and to effectively administer and collect the levy?

Tom Arthur

Yes, absolutely. I agree entirely with Mr Macpherson. I pay tribute to Ben Macpherson for the work that he undertook as the Minister for Public Finance and Migration prior to the pandemic, and his engagement with local authorities on the measure. Once the bill is introduced in Parliament, I will, of course, be delighted to engage with all members and local authorities.

Of course, rigorous parliamentary scrutiny will be important to ensure that the legislation that is, ultimately, put before Parliament for a final vote is as robust as it can and should be.

I call Miles Briggs, but with a reminder that members need to be in the chamber at the start of portfolio questions. They can sometimes finish early, but it is roll-on business.

Miles Briggs (Lothian) (Con)

Thank you, Deputy Presiding Officer.

Does the minister believe that there might be a link between the City of Edinburgh Council being the only council that is looking to take forward a tourist tax and the fact that the City of Edinburgh Council receives the lowest level of funding per head of population from the Government?

Tom Arthur

I would not presume to speak on behalf of the City of Edinburgh Council, but I recognise that Edinburgh city is not just the premier tourist destination for Scotland and, indeed, the UK, but is a premier tourist destination for the world, which is something that we should all be proud of.

Free School Meals (Budget Allocation)

To ask the Scottish Government how much it has allocated in its budget 2023-24 for the roll-out of free school meals to all primary school pupils. (S6O-02273)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

The 2023-24 budget has made provision for £185.8 million to be allocated to local authorities for free school meals. That funding supports our universal free school meal offer for all pupils in primaries 1 to 5 as well as meals for eligible pupils from P6 to secondary 6. It will also support the next phase of our expansion programme, which will see free school meals being made available to all pupils in primaries 6 and 7 in receipt of the Scottish child payment.

Carol Mochan

When I asked the then Cabinet Secretary for Education and Skills, Shirley-Anne Somerville, about this in March, she recognised that

“a number of local authorities are facing challenges in planning for that substantial expansion of free school meals.”—[Official Report, 23 March 2023; c 66.]

Will the cabinet secretary outline what direct support is going where in the provision to councils to overcome such challenges? Has she given consideration to calls by organisations such as Aberlour, which asks Government to increase the eligibility threshold beyond the already promised extension to P6s and P7s in order to support low-income families?

Shona Robison

Carol Mochan rightly points to some of the complexities around planning for the substantial expansion of free school meals, particularly around the kitchen and dining facilities required to support that. Of course, it is not a universal picture, and some schools have more challenges than others. A lot of work has been undertaken to understand that and to make sure that the resources are going to the places that they need to go to. I hope that Carol Mochan will agree that that is a sensible set of arrangements.

It is right that the expansion is focused on all pupils in primaries 6 and 7 in receipt of the Scottish child payment. I understand the position of Aberlour, but we have to do it in a way that is deliverable and affordable. That is the best place to start as we continue with our commitment to expand free school meals to all primary 6s and 7s. We are of course also still committed to the pilot in secondary schools.

I will take a brief supplementary from Monica Lennon.

Monica Lennon (Central Scotland) (Lab)

More secondary schools use a cashless payment system and it is difficult for school meal debt to accrue in those settings. What steps is the Government taking to assess the true level of hidden hunger in secondary schools, and the implementation of the school meal debt management guidance that was rolled out earlier this year?

As briefly as possible, cabinet secretary.

Shona Robison

We rely on local authorities to ensure that they feed back any issues in relation to the guidance. We will continue to work with them to see whether any improvements can be made. They obviously have flexibility around dealing with debt in individual cases, which we would encourage them to use. Ultimately, however, it is for local authorities to advise us if there are any issues, particularly pertaining to the guidance.

Planning (Scotland) Act 2019 (Implementation)

To ask the Scottish Government whether it will provide an update on implementation of the Planning (Scotland) Act 2019. (S6O-02274)

The Minister for Local Government Empowerment and Planning (Joe FitzPatrick)

We have recently implemented substantial elements of the 2019 planning act to strengthen Scotland’s plan-led planning system. That included the adoption, on 13 February, of national planning framework 4. Just last week, regulations came into force that implemented the new approach to planning authorities’ production of stronger, evidence-based and place-focused local development plans to shape future development across Scotland. We are now turning our attention to implementation of the remaining aspects of the act, including the forthcoming appointment of a new national planning improvement champion.

Ruth Maguire

On Monday—which, incidentally, was United Nations biodiversity day—I visited Ardeer peninsula with the community council and friends of Ardeer. The special development order, which I amended the planning bill to revoke a number of years ago, remains in place, and development and commercial activity on the peninsula are not subject to the usual planning protections.

A sand dune system is being destroyed for commercial gain, and it is a devastating loss of important ecological habitat. I understand the complexity of the matter of revocation and I appreciate the competing rights and interests of community, commerce and public bodies. However, inaction is not an option. Will the minister meet me with a view to resolving the matter sooner rather than later?

Joe FitzPatrick

I am aware of the specific and complex circumstances at Ardeer and the implications for the planning of the area resulting in particular from the special development order that is in force there. I am also aware that Ms Maguire has written to me on the matter; she will not yet have received my response, but I will be happy to meet her to discuss these matters in detail.

Maggie Chapman (North East Scotland) (Green)

Across the north-east, communities are struggling with planning issues. Torry in Aberdeen might be about to lose a biodiverse green space, and its last community park, to development. In Angus, a crematorium is planned on agricultural land, without appropriate transport connections and other amenities to deal with the increased capacity and activity.

How can the Scottish Government ensure that local authorities are following the national planning framework 4 principles and guidance, and doing all that they can to protect communities’ wellbeing and safeguarding nature?

Joe FitzPatrick

Members will appreciate that I cannot comment on any individual development proposals to be considered through the planning system. However, NPF4, following its adoption in February, took on a new statutory development plan status alongside local development plans. That means that all decision makers are required, under the Planning (Scotland) Act 2019, to determine applications in accordance with the development plan, including NPF4, unless there are material planning considerations that justify a departure from the plan.

We are monitoring the impact of NPF4 and its policies as part of a programme of work to support its delivery.

Chancellor of the Exchequer (Discussions)

To ask the Scottish Government when it last met with the Chancellor of the Exchequer and what was discussed. (S6O-02275)

The Deputy First Minister and Cabinet Secretary for Finance (Shona Robison)

The most recent meeting between the Scottish Government and the Chancellor of the Exchequer was at a meeting of the Prime Minister and the heads of the devolved Governments on 10 November 2022, when the economic outlook and impact of rising inflation were discussed.

I had an introductory meeting with the Chief Secretary to the Treasury on 2 May, and will meet him again at the upcoming finance interministerial standing committee meeting on 22 June.

I would welcome a meeting with the chancellor himself to discuss the economic challenges facing Scotland and the constraints placed on the Scottish Government’s finances. I also encourage the United Kingdom Government to do more to provide support to people and businesses during this difficult economic period.

Annabelle Ewing

Given in particular the on-going negative impacts of high inflation on Scotland’s fixed budget, the need for fiscal flexibility such as normal borrowing powers is ever more pressing in order to manage risk and to support economic recovery.

Can the cabinet secretary therefore advise whether the UK Government is in fact on Scotland’s side here?

Shona Robison

Annabelle Ewing is quite right to mention the impact of inflation, which is very much being felt in the budget, as the block grant at the time that the budget was set was 4.8 per cent lower in real terms than it was in 2021-22, and the fixed nature of the budget means that we have to redirect money from other priorities to pay for things such as increased public sector pay deals.

I have made clear to the UK Government the need for greater flexibility in borrowing powers to enable us to manage risks and support economic recovery. We have consistently made the case for additional funding; in my recent meeting with the CST, I stressed the need for further clarity on what consequentials we can expect, for example, from national health service pay in England.

While the UK Government has rejected our previous calls for greater fiscal flexibility, we remain in constructive discussions on the wider fiscal framework review.