Seòmar agus comataidhean

You are quite right to say that you cannot overspend: that is absolutely a legal requirement for the Government. Notwithstanding what you said in answer to my first question, there are choices to be made. When it comes to certain underspends, which were large in the health budget—you have explained about future requirements when it comes to vaccines and so on, which I absolutely understand—there are issues around infrastructure, transport and so on.

In a period when urgent economic assistance is required, people are quite rightly asking what has driven the choices when you hold some money back for the next set of financial payments. What drives those choices that you have to make? That is what I am trying to ask you: what do you absolutely prioritise when it comes to the underspend money?

I asked the question because there are people around the country who might ask why there is an underspend on the Scottish budget during a pandemic when businesses face serious issues. I think you said last week that you had spent absolutely every penny that you had to hand, but another £100 million appeared for business. Do you understand public concern about that £580 million being there but not being spent at a time when people have really urgent concerns?

That will be very helpful, because there are members who want a bit more guidance. The SPCB has done a very good job on the issue, and it was a very sensible recommendation for us to contact local police and so on for home visits. Lots of members would like to be able to feed back on those contacts and ensure that the SPCB can help them with some of the costs, hopefully in the not too distance future.

All three panellists have highlighted considerable extra expenses that the Parliament is having to cope with, including staff costs, security costs and on-going inflation. There are also some savings, as I can see from the numbers. What processes are there for the SPCB to estimate the changes in savings that will come about because of our changed working practices? For example, members’ travel expenses over the period of Covid were less than what they had been before, because we worked at home, as did our staff. What processes are there for the SPCB to project whether the change to working practices will be permanent, and to project what savings will accrue from that if it does? How can that be worked out?

Good morning. Cabinet secretary, I know that you are keen that we stick to the facts that are contained within the Scottish Fiscal Commission forecast, which informed your budget, and I will try very hard to do so. Just before I come to questions about some of the Scottish Fiscal Commission’s comments, I turn to page 104 of the Scottish Government consolidated accounts for 2020-21, which shows an underspend of £580 million, broken down across portfolios. Some portfolios have an overspend but some have a very considerable underspend, including big portfolios such as health and sport and transport and infrastructure. Can you be clear about why that underspend exists and what informed the choices when it came to overspend and underspend?

This is my final question. The CBI-KPMG report is pretty blunt in certain areas. It flags up that we have huge educational potential and that the skills agenda has potential in terms of green jobs, and all that is good news. However, when it comes to the traffic light—red, amber or green—on how we compare with other parts of the UK in terms of what our short-term and long-term bases are, there are some really worrying statistics about our weakness in business investment, exports and in-work training. I suggest, cabinet secretary, that those are related to issues in the structure of the Scottish economy. Can you say a bit more about how you intend to deal with those concerns?

I will follow on from that point. If we assume that the main challenge is to address the problem of proportionately declining tax revenues, am I right in thinking that you both suggest that the policies that are required to deal with that challenge are not only fairly straightforward fiscal policies, such as increasing tax or changing thresholds, but policies that will address some of the structural problems in the Scottish economy?

Would it be fair to say that, given the transition to net zero and the prediction that the oil and gas industries will diminish further, the result will be on-going issues for the tax take. Is that your prediction?

As you say, it is maybe an issue for the cabinet secretary in due course.

I will ask about what you said regarding the oil and gas situation. You said that it was one of the big factors affecting matters. To what extent to do you think that the decline in the oil and gas sector is having one of the biggest effects on reducing the tax take?

I asked the question largely because one of the difficulties that has been flagged up, in this meeting as well as previously, is that we have an ageing population, so the working population—which obviously pays the tax—is shrinking as a proportion of the overall population.

That cannot be changed overnight, which leads to the question of whether there are other policies that we can put in place to try to compensate for what is predicted. Both of you, as well as the witnesses from the Fiscal Commission, have said that the outlook is not great. Which policies will give us the best chance of addressing our difficulties and potential deficits? That is the main question. I will ask the cabinet secretary that question, too, but I am interested in what you think the evidence shows.

Professor Roy, you made some extremely interesting points about productivity and said that Scotland does very well in some cases and not very well in others. How does that relate to our concerns about employment trends in the Scottish economy? Do we have to use employment policies more to try to get us around some of the difficult structural issues?