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On where the money has gone, the Fraser of Allander Institute said on 31 January:

“it does not seem credible that it was in line with ‘internal planning assumptions’, in the context of emergency budget measures prior to the UK Budget”.

The approach that we have ended up with is chaotic, is it not? The budget was set at the start of the year, but there were massive emergency in-year cuts and reallocations within those cuts. You then come to committee and tell us, “We assumed that all that money was coming anyway,” and we find ourselves at the end of the year with a contingency surplus that is going to be held back. On a policy level, that is all over the place—it is up and down and there is no real planning. The approach has just involved waiting for what comes along, has it not?

Pace is an issue. We have now known for years that the money is there to be allocated. However, instead of it being spent on net zero projects, realising the employment across the country that is required and getting the supply chain in line, it has been used as a bank account to balance the Scottish Government’s budget. It has been held as a reserve instead of being allocated.

We are now being told that it is going to be allocated, but we have not had any real sight, other than broad headings, of when it will happen. Can we have confidence that it will actually be spent this year? If we do not know what the projects are now, what is the chance that the money will flow through into them this year?

I want to stick with the contingency, for the moment. Is that something that you, as Minister for Public Finance, felt had to be created? Have you, as a result of looking over the conduct of previous budgets, decided to create that space in the budget? You have given us some of the rationale behind it, but is it an approach that you have had to push through? Is it a new characteristic of the Government’s handling of budgets?

My questions also start from the premise that you claimed to have set a balanced budget at the start of last year but you did not.

ScotWind has played the role of a contingency fund for the Government over the past couple of years, according to Gillian Martin and others. We are now told that the money is going to be spent in year. When can we expect those allocations to be made to projects? Over the past year, there has been an underspend against the net zero budget of about £40 million. When will we see the pipeline of projects in the north-east and across the country that will see that money delivering against net zero targets and projects?

Can we expect that to happen again next year?

So, it makes sense in principle, but how do you see it operating? Would you meet the costs of up-front demand throughout the year then try to replenish the fund through adjustments throughout the year, so that, by the end of the following financial year, you would have had your £350 million? Is that the mechanism that you anticipate?

That is good to hear.

I will close on public sector reform. We have heard about the money that is to be saved and about Minister McKee’s work in that area and the summit that he held this week. You have already set out some useful figures showing projected additional savings of £380 million in the years to come, which is good to hear. Ivan McKee said that the framework for some of that will be delivered near the start of the 2025-26 financial year.

What is the difference between what we are seeing now and the resource spending review that the Government stopped? What do you think is the difference between those two programmes? One was published three years ago. You previously told us, and have said again today, that that was a bit of a blunt tool, so what do you think is the difference between the programme that was put in front of Parliament three years ago and the process that is now being undertaken?

The committee has been quite clear about our desire to see a directed plan that follows a strategy. The committee is unanimous on that, as is shown in what we have published.

The resource spending review asked for

“investment in systems and processes, with targeted workforce growth in priority areas”,

and said that

“We do not propose a uniform approach due to varying trends in demand for different services.”

The resource spending review acknowledged that there was no global figure for reduction, but that there were specific plans for different areas, which is the same as what is being described now. So, my core question is this: have we just wasted the three years between the publication of that document and where we are now?

You are the director of public spending for the Scottish Government, Mr McCallum, so you will have a direct insight into this. Is bringing the policy solution and then asking the civil service to cost it up and do it a typical way of developing a policy? Is a more typical way not to go to the civil service and have a discussion about the minister’s intent and what they are seeking to achieve, and for the civil service to then come back with options and say, “These are what we think are the best ways to do it, minister,” so that you can make a decision on that, because you are the Government?

Yes, absolutely. One of my concerns is pace and how long it is taking. Children are living in poverty right now, and we want that action to take place as soon as possible. In your response to our report, you said that you considered different options around pace, but you are not setting out any other options to me. You have said one thing here, which is the evidence that you have just given. Were the civil servants involved in the discussions?