Seòmar agus comataidhean

::I will in a minute.

The Government comes up all the time with the fact that it is an investment, but it never tells us what the return on that investment is, nor does it tell us where the money is coming from. Perhaps Mr McKee, who told us that there was going to be an extra £1 billion, which has changed to £1.5 billion, will tell me something new.

::I wish the cabinet secretary all the best in the future and, although I will not miss Mr Gibson’s SNP statements in the chamber, I will most certainly miss his convenership of the Finance and Public Administration Committee, in which he has been outstanding, and for which he is well recognised right around the chamber. It is through that convenership that Mr Gibson has regularly challenged us to debate effectively in the committee. It is on that basis, in my last contribution to a budget debate, that I will proceed in considering some of the issues that we have to address in the chamber, with specific reference to the budget that is before us.

Notwithstanding all the complexities that exist in the timing of different fiscal events, I do not personally feel that there is sufficient time for enough detailed parliamentary scrutiny of budgets or, therefore, for efficient scrutiny. I note the recent decision of the parliamentary authorities to announce that, for all new and returning MSPs, there will be special training on budgets. I welcome that. However, the very fact that that is having to happen speaks volumes about where the problem lies.

I will make the following three points. First—and this definitely applies to this budget—there is not sufficient detail about Scottish Government policy priorities in relation to how well they deliver their outcomes. I am not talking about the four grand aims of this Government, which are promoting economic growth, tackling child poverty, addressing climate change and delivering high-quality and sustainable public services, but rather the specific policies that underpin each of those. Where is the accompanying Scottish Government evidence that is supposed to persuade us that the policy choices that it is making in this budget are those that will deliver the best outcomes, given the limited resources that are available? As a consequence of that, and especially given the tight fiscal constraints, which policies have had to be deprioritised, and why?

Those are points that have frustrated the Finance and Public Administration Committee for quite some time. For example, the Scottish Government has been challenged so often to argue why its more generous approach to public spending on welfare yields better overall results all round for Scotland’s economy.

::Mr McKee knows full well that the economic inactivity rate is a serious issue. It has come up in just about every meeting that I can remember of the Finance and Public Administration Committee. In giving evidence to the committee, the First Minister once said that it was Scotland’s most difficult economic challenge—I think that I am right on that, and I can look back at the Official Report. That is because we have to get people back into work so that productivity can increase and we get a better return on the tax base.

My second point is that there is a concern among many analysts, including the Auditor General, that there is no credible long-term plan to address the significant challenges arising from the bloated welfare budget and the increasing demands on health and social care. The Scottish Government always appears to be in favour of short-term fixes rather than addressing the long-term problem.

My third point is about the tension between central and local government. They always seem to be at each other’s throats because of the huge pressure on front-line services, the delivery of which does not have the relevant money behind it.

During the stage 1 debate, I cited examples of the inconsistencies within the Scottish Government’s policy priorities for economic growth. Like so many others, I do not understand why certain policies were selected as a priority when economic data shows that they are undermining the overall approach. What am I talking about? As the briefing on the recent spending review makes clear, in the graph that is headed “Real terms changes in portfolio spending”, which covers 2025-26 to 2028-29, education and skills, finance and local government, and the economy are all facing real-term downturns in spending over the next four years. That hardly demonstrates a Scottish Government that is committed to growth in the economy.

I will finish on an absolutely instrumental point, which I made in the stage 1 debate and in the committee debate: we have to ensure much better scrutiny of the budget. I—and my colleagues on the Finance and Public Administration Committee—believe that it is time that the Scottish Parliament had a finance bill process. I hope that the next Government—whatever colour it might be—will agree to that. If we do not have that, decisions will continue to be made without the necessary evidence to back them up.

::Does the minister recognise that that commitment, which the Parliament has now made by passing the bill, was an SNP manifesto commitment in 2021?

Does the minister recognise that that commitment, which the Parliament has now made by passing the bill, was an SNP manifesto commitment in 2021?

Mr McKee knows full well that the economic inactivity rate is a serious issue. It has come up in just about every meeting that I can remember of the Finance and Public Administration Committee. In giving evidence to the committee, the First Minister once said that it was Scotland’s most difficult economic challenge—I think that I am right on that, and I can look back at the Official Report. That is because we have to get people back into work so that productivity can increase and we get a better return on the tax base.

My second point is that there is a concern among many analysts, including the Auditor General, that there is no credible long-term plan to address the significant challenges arising from the bloated welfare budget and the increasing demands on health and social care. The Scottish Government always appears to be in favour of short-term fixes rather than addressing the long-term problem.

My third point is about the tension between central and local government. They always seem to be at each other’s throats because of the huge pressure on front-line services, the delivery of which does not have the relevant money behind it.

During the stage 1 debate, I cited examples of the inconsistencies within the Scottish Government’s policy priorities for economic growth. Like so many others, I do not understand why certain policies were selected as a priority when economic data shows that they are undermining the overall approach. What am I talking about? As the briefing on the recent spending review makes clear, in the graph that is headed “Real terms changes in portfolio spending”, which covers 2025-26 to 2028-29, education and skills, finance and local government, and the economy are all facing real-term downturns in spending over the next four years. That hardly demonstrates a Scottish Government that is committed to growth in the economy.

I will finish on an absolutely instrumental point, which I made in the stage 1 debate and in the committee debate: we have to ensure much better scrutiny of the budget. I—and my colleagues on the Finance and Public Administration Committee—believe that it is time that the Scottish Parliament had a finance bill process. I hope that the next Government—whatever colour it might be—will agree to that. If we do not have that, decisions will continue to be made without the necessary evidence to back them up.

I wish the cabinet secretary all the best in the future and, although I will not miss Mr Gibson’s SNP statements in the chamber, I will most certainly miss his convenership of the Finance and Public Administration Committee, in which he has been outstanding, and for which he is well recognised right around the chamber. It is through that convenership that Mr Gibson has regularly challenged us to debate effectively in the committee. It is on that basis, in my last contribution to a budget debate, that I will proceed in considering some of the issues that we have to address in the chamber, with specific reference to the budget that is before us.

Notwithstanding all the complexities that exist in the timing of different fiscal events, I do not personally feel that there is sufficient time for enough detailed parliamentary scrutiny of budgets or, therefore, for efficient scrutiny. I note the recent decision of the parliamentary authorities to announce that, for all new and returning MSPs, there will be special training on budgets. I welcome that. However, the very fact that that is having to happen speaks volumes about where the problem lies.

I will make the following three points. First—and this definitely applies to this budget—there is not sufficient detail about Scottish Government policy priorities in relation to how well they deliver their outcomes. I am not talking about the four grand aims of this Government, which are promoting economic growth, tackling child poverty, addressing climate change and delivering high-quality and sustainable public services, but rather the specific policies that underpin each of those. Where is the accompanying Scottish Government evidence that is supposed to persuade us that the policy choices that it is making in this budget are those that will deliver the best outcomes, given the limited resources that are available? As a consequence of that, and especially given the tight fiscal constraints, which policies have had to be deprioritised, and why?

Those are points that have frustrated the Finance and Public Administration Committee for quite some time. For example, the Scottish Government has been challenged so often to argue why its more generous approach to public spending on welfare yields better overall results all round for Scotland’s economy.

I will in a minute.

The Government comes up all the time with the fact that it is an investment, but it never tells us what the return on that investment is, nor does it tell us where the money is coming from. Perhaps Mr McKee, who told us that there was going to be an extra £1 billion, which has changed to £1.5 billion, will tell me something new.

The convener gave a very good summary of the concerns that the Finance and Public Administration Committee has expressed about the budget process. Before I move into my speech, I want to add some context from six of the expert analysts who attended the committee on Tuesday this week. They raised some very important issues that we should be thinking about.

First, there is not sufficient detail about Scottish Government policy priorities and how well they deliver on the intended outcomes, and, as a consequence of the very tight fiscal constraints, which policies have been deprioritised and why. Those points have frustrated the committee from time to time. Professor Heald made the particularly interesting remark that the Scottish Government is often more generous in its approach to spending than Governments in the rest of the UK. However, seldom do we see the reverse of that, and we certainly do not see where the money is coming from. That situation is at the heart of the policy decisions in the budget.

Secondly, the Auditor General strongly made the point that there is no credible long-term plan to address the very significant challenges that arise from the bloated welfare state budget and the demands of health—which David Phillips spoke of today—and of social care. The Scottish Government appears to favour the short-term fix. We have concerns about the lack of a baseline in the budget and the fact that it is extremely difficult to track where money is being spent effectively.

Thirdly, the analysts said that local government is facing a very serious issue of fiscal unsustainability in the long run, which definitely puts front-line services under threat. There is also the threat of significant council tax rises in April.

Those are all very important points that do not come from me or from the Scottish Conservatives but from highly respected experts—I agree with what Michelle Thomson said about the Scottish Fiscal Commission—who do a deep dive into the Scottish budget. We should listen to what they have to say.

In the light of those experts’ concerns, we have to ask why policies have been adopted in successive Scottish budgets that undermine the Government’s stated overall objectives, especially when it comes to economic growth. Why on earth does the Scottish Government believe that its policy on the non-domestic rates issue—although it is good to see some mitigation and relief in that regard—its visitor levy and its removal of the small business bonus for deer management businesses and some rural businesses will provide greater economic growth?

The Cabinet Secretary for Health and Social Care has just left the chamber, but three budgets ago, when he was Cabinet Secretary for Wellbeing Economy, Fair Work and Energy, we had an 8.3 per cent real-terms cut to the economy portfolio. We have had an increase in college funding, although the figure for it is disputed. However, there has been a 20 per cent real-terms cut in college budgets since 2021, when it is colleges that have to address the skills agenda and ensure that we get many more people back into the labour market.

Those are the concerns with the budget. This is not just about different party-political angles or about what policies would be better in which places. There are fundamental issues, some of which the convener has raised in the Finance and Public Administration Committee’s report and some of which are being raised by the analysts who scrutinise the Scottish budget. We should be listening to what they have to say, because these are serious challenges, not just for this budget but for the next Government, whichever colour it might be.

16:13

The convener gave a very good summary of the concerns that the Finance and Public Administration Committee has expressed about the budget process. Before I move into my speech, I want to add some context from six of the expert analysts who attended the committee on Tuesday this week. They raised some very important issues that we should be thinking about.

First, there is not sufficient detail about Scottish Government policy priorities and how well they deliver on the intended outcomes, and, as a consequence of the very tight fiscal constraints, which policies have been deprioritised and why. Those points have frustrated the committee from time to time. Professor Heald made the particularly interesting remark that the Scottish Government is often more generous in its approach to spending than Governments in the rest of the UK. However, seldom do we see the reverse of that, and we certainly do not see where the money is coming from. That situation is at the heart of the policy decisions in the budget.

Secondly, the Auditor General strongly made the point that there is no credible long-term plan to address the very significant challenges that arise from the bloated welfare state budget and the demands of health—which David Phillips spoke of today—and of social care. The Scottish Government appears to favour the short-term fix. We have concerns about the lack of a baseline in the budget and the fact that it is extremely difficult to track where money is being spent effectively.

Thirdly, the analysts said that local government is facing a very serious issue of fiscal unsustainability in the long run, which definitely puts front-line services under threat. There is also the threat of significant council tax rises in April.

Those are all very important points that do not come from me or from the Scottish Conservatives but from highly respected experts—I agree with what Michelle Thomson said about the Scottish Fiscal Commission—who do a deep dive into the Scottish budget. We should listen to what they have to say.

In the light of those experts’ concerns, we have to ask why policies have been adopted in successive Scottish budgets that undermine the Government’s stated overall objectives, especially when it comes to economic growth. Why on earth does the Scottish Government believe that its policy on the non-domestic rates issue—although it is good to see some mitigation and relief in that regard—its visitor levy and its removal of the small business bonus for deer management businesses and some rural businesses will provide greater economic growth?

The Cabinet Secretary for Health and Social Care has just left the chamber, but three budgets ago, when he was Cabinet Secretary for Wellbeing Economy, Fair Work and Energy, we had an 8.3 per cent real-terms cut to the economy portfolio. We have had an increase in college funding, although the figure for it is disputed. However, there has been a 20 per cent real-terms cut in college budgets since 2021, when it is colleges that have to address the skills agenda and ensure that we get many more people back into the labour market.

Those are the concerns with the budget. This is not just about different party-political angles or about what policies would be better in which places. There are fundamental issues, some of which the convener has raised in the Finance and Public Administration Committee’s report and some of which are being raised by the analysts who scrutinise the Scottish budget. We should be listening to what they have to say, because these are serious challenges, not just for this budget but for the next Government, whichever colour it might be.

16:13