Seòmar agus comataidhean

On the point about local government, the settlement and distribution group will decide on the distribution of the £144 million. That is how such things normally work. It is fair to say that, across the board, there will not be a percentage that each of the 32 local authorities gets. As you know from your own experience, convener, each local authority has a different configuration. For some of them, almost all of their social care services are commissioned; for others, they are entirely in-house. That will affect what the settlement and distribution group ends up doing. Ministers have no involvement in that whatsoever; it is for the Convention of Scottish Local Authorities and the leaders of the 32 councils to agree on.

On your point about the impact on the third sector, social care services and universities, the challenges are incredibly difficult. The Scottish Government does not have the difference between the £300-odd million coming from the Treasury and the £750 million of costs that those organisations will face—and private businesses will have costs in the same way. We do not have the funding to be able to financially support the sectors: the money has gone out of the door. As I indicated at stage 1 of the budget, we have maximised the funding to our services as much as we can, and I hope that that will provide a degree of resilience.

We can help them in other ways, though. I have been clear with colleagues that we must look at non-cash ways to support the third sector. One way in which we can help the third sector is through multiyear settlements so that organisations know what their funding will be over several years. That approach can help them to plan, retain staff and work through some of those challenges in a way that single-year funding does not. We have asked all the cabinet secretaries to look for ways to do that within their portfolio areas.

There would have to be discussions about the various pressures and how we work through those priorities. The Cabinet and the First Minister will have a view on that. We have said that, if we were able to introduce the two-child limit mitigation a bit earlier in 2026, we would look at how that could be done. What we are not able to do is to introduce it next month or the month after that, for practical and financial reasons—that just could not be done.

It would not be an easy thing to do. We would have to look at the funding that is available, whether any underspends have emerged in other areas and what we would be able to do. You are right to say that there will be other pressures from other sectors with regard to resources that become available in-year and what the relative priority of those is. As a Cabinet, we will discuss that.

We want to be fair to public sector employees, and we want to progress any workforce reforms in partnership with the unions. That partnership has been really important in helping to manage change and the way that things are done, to bring stability and to avoid industrial disputes. We want to do that in partnership as far as we can.

As you pointed out, change has already taken place, with around a 39 per cent reduction in the contingent workforce. That has been very much supported by the unions. It is an expensive area of the workforce, because contractors come in with contractor rates. A massive reduction in that has led to our being able to reduce the overall figure, but we need to go further than that.

The invest to save proposition is also partly intended to help with that issue. You mentioned that voluntary severance schemes can be expensive. Some invest to save propositions will, no doubt, come forward that might be in that territory.

On your point about no compulsory redundancy, as far as I am aware, the position of public bodies has always been that they should look to do everything that they can to seek redundancies on a voluntary basis and that they could have compulsory redundancies only when there is absolutely no other option—if all other options have been explored and cannot be pursued. That has always been the case. Public bodies will obviously want to avoid that situation, but that has been an option available to them—in extremis—and that remains the case.

I will not comment on the issue of ministerial pay, but—

I have nothing to add.

Amendment 1 agreed to.

Amendments 2 to 5 moved—[Shona Robison]—and agreed to.

Schedule 1, as amended, agreed to.

Section 2 agreed to.

Schedule 2 agreed to.

Section 3 agreed to.

Schedule 3 agreed to.

Section 4—Overall cash authorisations

Amendment 6 moved—[Shona Robison]—and agreed to.

Section 4, as amended, agreed to.

Sections 5 to 11 agreed to.

Long title agreed to.

Yes. I am happy to take that away.

Would you have made different choices?

The tax strategy was based on a lot of consultation with a number of organisations. That included the tax advisory group, which has a number of stakeholders, tax experts, the Fraser of Allander Institute, the Scottish Trades Union Congress and the Joseph Rowntree Foundation. We received a wide variety of views on what the purpose of tax is. Where we got to with the tax strategy is a recognition that, first of all, we have to make sure that people understand the system. We drew on evidence from around the table and empirical evidence from His Majesty’s Revenue and Customs and others that looked at the behavioural impact of tax, and we made sure that we took cognisance of all of that.

However, that is not the end of the process. That work continues and we continue to gather evidence, because it is important to do so. That got us to this point.

The issue is that, if tax cuts are proposed, people have to say where spending would be reduced to accommodate them, and that has been lacking in the debate so far.

The strategy, in principle, has been quite warmly received by commentators. It is not something that the UK Government has done regarding the purpose, outlook and vision for tax.

We have no plans to do that specifically, but we are cognisant of the need for people to understand the system. Making sure that people understand the system—there is work emanating from the tax strategy to help to do that—will ensure greater levels of compliance. There will be higher levels of compliance if people understand their obligations and how the system works. That is definitely a major pillar of the tax strategy and the work that is being taken forward to help people to comply with their tax obligations.

The First Minister said that a range of options was available to the chancellor. Everyone accepts that, but she chose not to take those options but instead to hike employer national insurance contributions. That is something that you have just said you think is problematic, so I presume that you would have liked the chancellor to use another option and that you think that something else should have been done.

A range of options were open to the chancellor and could have resulted in a better outcome than the one that we have. That is the position. No one supports a reduction in funding for Scottish public services.