Seòmar agus comataidhean

The cost of living is probably primarily responsible for it, because, generally, debt rises in a cost of living crisis. People sometimes make a judgment to prioritise the bills that they think would result in more immediate pursuance.

I have often spoken to constituents who are in a difficult situation and they, rightly or wrongly, sometimes perceive the council tax as a debt that is not going to be immediately pursued, so they prioritise preventing power from being shut off and putting food on the table. People will make a judgment, which I suspect comes down to where council tax debt sits in a list of debts with which they are wrestling. That is my first point.

What we do about that is an issue, and the Scottish Government has been supporting a number of debt services. Local government is doing a lot of very good debt work in order to support people and make sure that they know about some of the discounts and what they are entitled to, because they sometimes do not know about council tax reduction support. It is important that people get support and that arrangements are made to enable them to repay in a sustainable way. I know that local authorities have been very proactive in doing that.

Best value is really important, and not just in local government. It is important that we are all able to show that every public service is striving to deliver the best outcomes with the resources that are available. I mentioned some of the ways in which I have seen local authorities giving more visibility to that. Best-value reviews are built into the Accounts Commission work, which gives the issue a kind of transparency.

As is always the case in all areas of public life, some local authorities are better than others at telling the story around those things and providing evidence and transparency. It is the same across all public services.

I am not going to rule anything out at this stage. First, we need to know what we are talking about, which is where the detail that Ellen Leaver mentioned, around who might need transitional additional support, comes in. We need to take it from there and break it down to look at who those people are, what their circumstances are and how we can support the position going forward.

We also have judgments to make about the overall system. Welsh colleagues were clear that one of the important things that they established from the start was that the process would be revenue neutral. I am very sympathetic to that position, because, if we say to the public that this is about making the system fair and that, in doing so, we recognise that some people will require transitional support—rather than it being a revenue-raising opportunity—that lands it in a different space. These things need to be discussed, but it is important that the purpose is set out clearly from the beginning. I would not dismiss some of those options, and the good thing about having detailed cross-party dialogue is that things might be suggested that could help to build a consensus.

There are things that we can learn from the Welsh experience. I had a good discussion with Mark Drakeford, who is now the Cabinet Secretary for Finance in the Welsh Government, at the bilateral meeting of finance ministers from across the UK. We talked about the progress that has been made in Wales.

Mark Drakeford had some reflections about things that perhaps they would have done differently—for example, the transitional arrangements were retrofitted after there was quite a hullabaloo about who lost out of the revaluation. There are lessons there; with any changes going forward, you would build in transitional arrangements right from the start that would give those changes a soft landing. Wales is also looking at further bands. We could look at how many additional bands might be required to make the Scottish system more progressive, and we could look at how the Welsh system works.

You could argue that it is down to how the political arithmetic has changed over the course of their Parliament and our Parliament. It has not been without its difficulties. When you look at the Welsh Government’s budget situation—securing its budget by one vote—I wonder whether, if it was trying to make some of those changes now, it would land in the same political environment that it did when it embarked on the consultation on revaluation. I am just surmising that opportunities for such changes will ebb and flow, depending on relationships and good will in Parliaments.

However, I repeat that we can take a lot of good evidence and lessons learned from the good aspects of how Wales did it, but there are also things that it would say in hindsight that it might have done differently.

That is a fair challenge. Part of the concern, perhaps, was about what would come out of the end of that—whether it would give us anything new without some political consensus having been built in advance.

The public element of consultation can take many forms. As long as it is there, and as long as it is local and led by local government, I am not sure that it necessarily requires to be in a particular format, whether that is a citizens assembly or anything else. It is a matter of ensuring that it is done in a way that gives us the same level of engagement with the public.

Why was that not done more quickly? It was probably because there was a bit of scepticism about whether anything arising from the event would change things and move us forward. I have therefore taken the position that we now need to get things in the right order to build political consensus and land changes in an environment that means that they will actually happen, rather than our debating the future of the council tax and replacing it with something that no one will agree on, which would be my worry.

That is my honest reflection on why we have probably not made the progress that we would have liked to make since 2021.

I want to avoid that. You make a fair challenge. If we were to go out and say, “Council tax: discuss,” that is exactly where we would probably end up.

The joint working group and COSLA leaders have still to narrow down the content of the engagement activity before going out to the public. It would be interesting to hear views from the committee on this. How, specifically, do we make the system more progressive? What do people think about additional bands? What do people think about transitional arrangements? We could begin to get into questions of what the system might be, rather than just saying, “Council tax: discuss.” That does not mean that the process is so narrow that it becomes one of saying, “This is your choice. Take it or leave it.” There is a balance to be struck. People need to get the sense that something could emerge at the end that will help with manifesto setting and a landing space that could be progressed in the next session of Parliament, from which people would see a tangible outcome.

I share your worry about where we could end up if the process is too broad. We do not want that, and I think that the public expects to know where the political consensus might be. Without that, legislation will go nowhere. There has to be a reality check, which should inform our thinking about what goes out to the public.

Katie Hagmann may want to add more.

Realistically speaking, I think that any actual practical changes would be made in the next session of Parliament, but we could lay the groundwork in this session for a willingness to create some consensus on which to move forward. Without that, we could have yet another parliamentary session with property values another five years out of date, no change to the bands and no movement on the issue.

I am keen to explore the art of the possible here. I think that you are right: everybody accepts that there is a problem and that changes are required. However, there are ways of giving such changes a very soft landing that would bring the public with us. Therefore, this is not just about building political consensus in order to do something to the public; that is why the consultation and the public events that we are holding are very much about engaging the public themselves on the options, on what would be acceptable, on what could make the system fairer and on how we ensure that any change lands in a way that deals with some of the obvious problems that might arise.

It would be quite an achievement to create a better landing space for any actual proposals, which could then go forward into the next parliamentary session. It will require a lot of detailed work, including technical work, and it will then require legislation, which, by its nature, will require consensus to some degree.

We would have to look at that as part of the modelling, to ensure that we were cognisant of that. Katie Hagmann referred to some of the very small local authorities and the relative value of council tax as part of their financial base. That brings us into other spaces, such as reform, and I am aware of really good discussions between Clackmannanshire, Falkirk and Stirling councils about shared services and how we can work more closely together. We recognise that that is just one part of the jigsaw; there are plenty of other things that we need to look at, and that work needs to be led by local authorities. For example, we recognise the on-going demand for services, which will continue to increase, not least in areas such as social care, so how do we manage that in the future? What we are discussing today is just one part of that picture.

As always, Ellen.

Inevitably there will be lessons, and we will seek to draw on what has worked well in terms of communication and where communication could have been better. The main point is that, given the complexity of the system, we need to be clear from the outset what it is that we are trying to achieve and what the options are to meet that objective. We can certainly draw not just on what the Scottish Government has done but on what has worked elsewhere in this area, such as the work that has been done in Wales, as I mentioned earlier, and the work in other jurisdictions.

At the end of the day, we need to get it right for Scotland, and it is our responsibility to land any reform in the right place so that it has the best chance of producing something that is useful for us all.