Seòmar agus comataidhean

Thank you.

Good morning. Some of my questions are linked to what has been discussed already, so we will probably dance around a bit.

On financial literacy in schools, I received a written answer yesterday to a question about a Bank of England pilot project—which is taking place in England but could equally apply in Scotland—in relation to increasing the uptake of economics as a subject in schools. The written answer reveals that, in Scottish schools, there is uptake of economics at national 5 level in only 12 schools, at higher in 37 schools and at advanced higher in only five schools. In part, that could be because there is no demand, but might you be keen to join the Bank of England programme to ensure that people leave school with a level of financial literacy that would perhaps give them a greater understanding of tax and spending as they move forward in life?

You said that work has been done to increase understanding of the tax system because that leads to greater compliance, but another way to achieve that would be to simplify the tax system. Have you taken external advice on that from either the tax advisory group or a consultancy?

You are talking about a potential £9 billion black hole. That assertion does not put food on the table, and you should surely do that work before you make such an assertion.

If reform is going to be as bold and ambitious as it needs to be, given the current situation with the Scottish Government’s budget, it will be fundamentally material to the MTFS.

I do not want to venture an argument that we are wasting our time here, but is there an issue that we have not addressed—namely that, although we are arguing for greater transparency and, alongside that, greater accountability, which are interconnected but not interchangeable, does the realpolitik of the situation not work against that?

In any five-year period in Scotland, we have three major elections: a Scottish parliamentary election, a Westminster election and a local government election. Does that not work against transparency because, ultimately, the picture is always evolving, which means that the Government cannot set out a five-year plan at the beginning of a new session of Parliament, because there are so many variables that could cut across that? Are we arguing for something that, ultimately, is unachievable not because of the devolution settlement but simply because of the way in which our different democratically accountable bodies are elected and the timeframe in which they are elected?

Although there might be what stakeholders perceive to be an absence of transparency, there is greater accountability, because we get three elections in five years out of the process. Dr Hosie, do you think that there is a causal link between transparency and political stability? I suppose that having three elections in five years does not provide political stability per se.

I go back to the original comment from Shona Robison about the floor. What more could be done so that the negotiations are more transparent and perhaps to take the heat out of them, so that the Government can be a bit more honest with you about what it can and cannot afford?

In your submission, you say:

“Politicians need to recognise the impact of public sector wage restraint following a decade of austerity, and that wages in the public sector will need to keep pace with private sector wage growth if we are to recruit and retain skilled workers.”

By contrast, the Institute for Fiscal Studies tells us that

“We do not find any evidence that larger increases in public sector pay in Scotland in recent years have boosted the retention of public sector workers.”

What is the point of higher pay for higher-earning civil servants? Is it to retain them or is it simply that that is the culture that now persists within those roles and functions?

Finally, has the Scottish Government tied one hand behind its back at the negotiating table by entering into discussions with a presumption that it will not countenance strike action?

Dave, I would like to extend the convener’s line of questioning. When Shona Robison appeared before the committee, she made the point that one of the reasons that the Scottish Government has not been transparent or forthcoming about public sector pay is that, if it put a number out there, that number would become the floor and the unions would always negotiate up. Is there an issue now with both sides not necessarily entering into these discussions in good faith? If the Government comes to you and says, “It is 9 per cent over three years or we are going to have to make cuts to front-line services,” should you not be taking that at face value and then working out how you apportion that annualised 3 per cent, rather than—as the recent data shows—public sector wage growth continuing to exceed wage growth not just in the rest of the UK but in the private sector?