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The Welsh Government is adding additional bands in its next iteration. Adding additional bands would help with the progressivity, which is a bit different from the multiplier, which was quite a different proposition. That was about the relative payment of existing bands because of the fact that those in lower bands pay a higher proportion of their income towards council tax. That was the premise. I will leave aside the fact that, as we have said, because that got significant pushback, it is history.

Creating more bands in the council tax system is inherently progressive, because it is then more directly related to the value of properties, and there are not cut-off points like the current system has, so the bands would be smoother. I would hope, as part of the discussion about how to create political consensus—it is a pretty modest change, to be honest—that we could agree that creating more bands in the system would help to make the system more progressive. It would be part of a wider set of reforms.

That principle absolutely holds, and that principle was set out in numerous iterations of how we see tax. It should be based on an ability to pay.

The property element of council tax is important, and the commission in 2015 made a recommendation in that regard, but there are subtleties. For example, a property does not always tell the full story of the income of the people who live there, but there is a correlation. Council tax reduction schemes such as the single-person discount are in place to recognise some of those issues.

I am clear that, if we are to land in a positive space, we will have to provide substantial transition schemes. The technical work will also be important. Analysis from the Institute for Fiscal Studies says that a revaluation would result in 60 per cent of households staying with the same bill, 20 per cent of households being better off and 20 per cent of households being the losers. My strong view is that, if we are to build consensus—not just politically, in the Parliament, but with the public—there will have to be strong transitional arrangements that smooth out the position over, potentially, a number of years.

Other jurisdictions around the world have done things to provide a very soft landing. For example, in British Columbia, someone can defer the impact of the changes for 10 years, by which point their property might be sold. I think that there would be political consensus on changes being made at the point of sale. There are 101 ways of ensuring a soft landing, with transitional arrangements in place for people in that category—the figure might not be as high as 20 per cent, which comes from the IFS; it could be significantly lower. I would want to be up front in providing maximum reassurance that there would be no cliff edges for people in that situation. That would require us to work with local government to establish the cost of such arrangements, which would need to be recognised.

I am trying to anticipate where the tricky, sticky bits will be, because, if we do not resolve them, we will not be able to move forward. We need to find a way of providing reassurance not only that we are aware of the issue but that we would actively create substantial transitional arrangements.

My worry is that we could spend an eternity talking about a full replacement to the council tax and, because that would create more areas of difference, we would end up debating backwards and forwards—as we have done over a number of years. I have run out of patience for that, to be honest. I am a pragmatist by nature. Rather than make no progress, why do we not just see whether we can make some progress? Even if it is quite modest, that will be better that than nothing.

In the future, there might be a different landscape and different views, and there might end up being a consensus around a complete replacement of the council tax, which would be great. However, I do not think that that is on offer in the here and now. There is too much scope for division. Instead of debating that, let us look at possible areas of agreement and move forward with those. If we could do something about 1991 property values in a way that is pragmatic and practical and has consensus, that would be better—it would be progress rather than nothing.

Local government has made a lot of efforts in that direction. I see a lot of local authorities setting out in detail what their council tax payers, if you like, can expect to receive from the investment that is being made. Local government services are funded through a hybrid of funds, of which council tax is just one element, but I think that there is something to be said for being on the front foot in setting out what the council tax will contribute to delivery, and I have seen some really good examples from local authorities that are doing that sort of thing more and more.

There might be something in that, although people probably have quite a strong reaction to taxes in general. I think that Katie Hagmann’s point about the visibility of council tax and the fact that it is a tax that spans two spheres of government, as well as there being interaction with actions that the Scottish Parliament might take—of course, any major changes to council tax would require legislation—goes back to the point about consensus. There is something about the complexity of council tax. There might be a historical legacy aspect and, as Katie pointed out, there is a lot of media attention. It is tricky.

I know that the First Minister has already set out some of the detail. The aim is not only to expedite any of the potential solutions that will be set out in the project willow report, but to consider proposals made by Unite and its members, for example, and to continue to pursue other options, including as yet unknown potential investments.

We want this money to work as quickly and as flexibly as possible to give the opportunity to secure jobs at the Grangemouth site. However, we must also see an urgent decision on the Acorn carbon capture and storage project if a just transition at Grangemouth is to become a reality. Amendment 1 therefore amends section 4 of the bill to increase the Scottish Administration’s overall cash authorisation by £25 million to cover the additional portfolio spend that is provided for by amendment 2.

Amendment 2 amends schedule 1 of the bill to increase the maximum spend of the net zero and energy portfolio by £25 million to create the just transition fund for Grangemouth. To take account of that additional authorised spend, amendment 3 amends schedule 1 of the bill to increase the total amount of resources that the Scottish Administration is authorised to use by £25 million.

I urge all members to support amendment 1 and the other amendments in the group.

I move amendment 1.

I thought for a minute that Anas Sarwar was going to abstain from his intervention, just to keep the record of sitting on the fence going.

As Anas Sarwar knows fine well, our objection was to the tax on jobs through the hiking of employer national insurance contributions, which is being felt the length and breadth of Scotland. Those job losses can be laid at the door of Anas Sarwar and his Labour colleagues.

As I said, it is not enough to will the ends—we must also will the means. I invite Labour members, even at this late stage, either individually or collectively to vote for the budget today and show that they are participants in change and not just spectators. With that in mind, I urge Parliament to support the budget.

I move,

That the Parliament agrees that the Budget (Scotland) (No. 4) Bill be passed.

I do not fundamentally disagree with Liz Smith’s point. Incidentally, though, I do not think that Craig Hoy identified any of those points. Is not one of the pieces of evidence that has come to light recently that, out of the whole of the United Kingdom, Scotland is the only place where child poverty levels are falling—they are rising elsewhere? Surely that is a concrete piece of evidence that this Government’s investment is working.

I am pleased to open the stage 3 budget debate. The budget is delivering record national health service investment; record local government funding; £4.9 billion in climate-positive investment; a universal winter fuel payment for the elderly; and the decisive steps that are necessary to effectively scrap the two-child benefit cap in 2026.

The budget has been made stronger through engagement across the Parliament to build the broadest possible support. As a result, there is progress on a range of matters that will help to make Scotland a better place, not least the funding for neonates affected by drugs and the piloting of a £2 bus fare cap.

I hold no expectations, of course, that the Conservatives will abandon their downward spiral as they chase the spectre of Nigel Farage—there is nothing new there. However, I still hope that Labour members will back the budget, thereby supporting the scrapping of the two-child cap, the reintroduction of a universal winter fuel payment, investment of £34 million for culture and investment in primary care, among other matters that they suggest that they support.

Last week, the First Minister set out further amendments to the budget to provide an additional £25 million to support the Grangemouth industrial cluster, and I am pleased that Parliament has supported those. That takes Scottish Government support for Grangemouth to almost £90 million. I welcome the Prime Minister’s subsequent announcement of the allocation of £200 million from the national wealth fund to investment in Grangemouth. Our funding will be available immediately in the new financial year and can be utilised without match funding; I hope that the national wealth fund moneys will be offered on a similar basis.

Carbon capture and storage is vital for a just transition to net zero. Advice from the United Kingdom Climate Change Committee describes carbon capture, utilisation and storage as a “necessity, not an option”. The Acorn project and the Scottish cluster are central to our environmental commitments and our economic ambitions, and that is why I continue to urge the United Kingdom Government to confirm the Acorn project as a matter of urgency. I back both the funding from the UK Government and the new funding that we are putting forward.

We have worked constructively with the UK Government as we try to secure a just transition for Grangemouth. The question for Labour members is whether that constructive approach be repeated today. Will they join us in delivering nearly £90 million for Grangemouth in the final budget vote? I certainly hope that they will.

Our distinct, inclusive approach to social security aims to tackle child poverty and support disabled people and carers. We are proud of the increases in social security expenditure that we are delivering, helping around 2 million people. That includes £644 million in our package of benefits and payments that are available only in Scotland, including the game-changing Scottish child payment.

As I have said many times, we will make sure that we prioritise the funding for social security spend, and I will set out further details in the sustainability delivery plan. However, the Tories have to tell us who, out of the 2 million people who are currently receiving support, they will stop giving support to. When the axe falls on support for people, who will be affected? They have to set that out.

In social housing, we are increasing supply by investing £768 million in affordable housing in 2025-26. Growing our economy is central to the delivery of all our priorities, and the Government will invest more than £7 billion in our total infrastructure package. The 2025-26 Scottish budget prioritises major capital investment in the foundations of our economy, such as housing, transport, digital connectivity and the delivery of critical infrastructure.

In delivering the wider investment that Scotland needs, the new 2025-26 Scottish budget will include more than £300 million of ScotWind funding, which will deliver substantial investment in jobs and in measures to meet the climate challenge, investing in the long-term success of our nation.