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Okay. Fair enough.

No. People who are working pay taxes, so that reduces the share of the Scottish budget that is going on welfare even if the welfare budget does not decrease. If you increase the Scottish budget by 10 per cent, 5 per cent or whatever, because more people are working, we can afford those welfare payments. The issue is that the economy is not growing but the welfare share of it is growing and it is squeezing every other aspect of the Scottish budget. That is causing real difficulties for universities, colleges, the justice sector, local government and everywhere else. That is the issue.

Oh! That is the opening that I never got invited to even though it is in my constituency.

Kleine.

One could argue that continuing to pay the benefit disincentivises someone to move out of a three or four-bedroom house to a one or two-bedroom house when a family actually needs that bigger house. However, I do not want to go into that specifically.

There are plenty of other things that you could spend that money on. For example, the Fraser of Allander Institute has said that each £1 spent on colleges would see a £6 return to the economy.

You are right—when I said, “Absolutely,” earlier, I meant, “Yes.” The Scottish Government seems to look at things from a 12-month perspective, and Michelle Thomson is right to say that there is no long-term strategic vision. If you are investing for the future, you will be investing more in universities, research and development, colleges and so on, rather than just putting sticky tape over the budget every year. That is a big frustration for the committee.

In response to Ross Greer’s questions, you mentioned research on whether the Scottish child payment disincentivises people to work. I have to say that the Scottish Government pledged that SCP would be £20 per week by 2026. It is now £27.15 per week, so it has gone above and beyond the manifesto commitment. But let us consider someone who is on housing benefit and is getting the bedroom tax mitigated, the Scottish child payment, the two-child benefit cap mitigated, free childcare and free school meals. Together, that is a pretty big disincentive to return to employment. Potentially, their children will grow up in household with a culture of worklessness. How do you address something like that?

Despite what Scottish ministers might think, there is real resentment in communities, particularly in working-class communities, where people go out at 6 or 7 in the morning to put in a shift for the living wage only to see people across the road appearing to get a lot of benefits while not contributing to society in the same way nor encouraging their children to do so. How do you look not at one particular benefit but at benefits in the round and their impact on wider society?

Yes, that is important. The issue is about striking a balance and how we can get the best for the individuals concerned and for the public pound. A lot of the employability courses seem to be getting cut, which is of real concern to the committee.

We will leave it there. Are there are any other points that have not been raised that you wish to make to the committee before we wind up?

Item 2 is to take evidence from two panels of witnesses on responding to long-term fiscal pressures, as part of our pre-budget scrutiny 2026-27. We are joined by Richard Robinson, senior manager, Audit Scotland; and João Sousa, deputy director and senior knowledge exchange fellow at the Fraser of Allander Institute. I welcome you both. We have your submissions, so we will move straight to questions.

I will begin by asking Mr Sousa about one of the things that you said in your submission. It is quite interesting, and it relates to a point that I put to the Cabinet Secretary for Finance and Local Government last week. You said that, under the medium-term financial strategy,

“No area of spending is assumed to fall in real terms—all areas are presumed to grow in line with inflation except those areas which are likely to grow more than that”,

such as the national health service, social security, pay and local government. Basically, you are saying that the MTFS assumes that there is no prioritisation, because everything is prioritised. Let me have your further thoughts on that.

Mr Sousa, you said that the statement that

“the devolved workforce will fall by 0.5% a year”

and

“this will have no effect on frontline services ... seems implausible in the absence of some pretty heroic improvements in productivity”.

Half a per cent a year doesnae seem that heroic, really. I know that we are talking about not just 0.5 per cent but 0.5 per cent over and above what productivity would be anyway. Will you talk us through how we can deliver that 0.5 per cent?

Without referring directly to them, you have alluded to compulsory redundancies, which I have raised many times in the committee. You went on to say:

“There is no reason to suspect that the people retiring or leaving the Scottish public sector will be doing so in the roles that need eliminated—a real plan, looking at the hard choices of what needs and does not need to be done, and how the skills for that match up with the ones available in the redeployment pool is what is necessary, and it seems to be missing from the FSDP.”

Mr Sousa, in respect of people who are economically inactive, you have talked about the need for a person-centred approach and for Scotland to emphasise skills in order to broaden the tax base. You have also talked about how, for example, there are real problems with capital formation, especially in net terms. Can you talk to us a wee bit more about that?

You go on to say:

“UK capital spending remains lower, barely above replacement level, and so does Scotland’s. Every year we invest less than peer countries, the gap in capital stock grows, which then results in the large gap in productivity we see today.”