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The resource spending review sets out broad parameters and is a lot more strategic than a budget would be. In that regard, the equality and fairer Scotland budget statement is very similar to the resource spending review in its approach—it uses a strategic lens.

I will keep my comments brief. The resource spending review does not replace the budget, so it does not include anything lower than level 2, which is, comparatively, quite a high level. It is difficult to get into the depths of specific lines that would normally be published in a budget at levels 3 and 4, which constrains how detailed an equality and fairer Scotland budget statement can be.

I can pick that up. From memory, the amount to be deployed was more than £200 million, and we chose the quickest way to deploy the full amount. The point that I made about other ways taking from six to nine months is mirrored on the time that it took for the low income payments to be deployed. We worked with COSLA to understand the fastest way to deliver the money. Carers are one group that need additional support and Shona Robison outlined what support was provided to them.

They are not, however, the only group needing support. There are significant groups of pensioners and of households with children and there are groups of people who do not fit into any of those three categories but who also need help and support. At a time like this, there is a huge group of people who need help and support. We will continue trying to deploy funding through the schemes that we already have in place.

You will recall that the announcement that the money was coming was made completely unexpectedly in the middle of February and that we had two or three weeks to not only figure out a way of deploying it quickly, but put it in people’s pockets. Doing that for as many as possible of the people who are struggling required us to move at pace.

There are a number of different schemes that could be identified to create that jigsaw of getting help out. To deploy the full £200 million or more in the round would have taken significant time. That is not to say that the ideas and suggestions about the carers allowance and other things are not still live and pertinent. As Shona Robison said, we absolutely will do more if we can. The fastest way to get that money out in the round without over-complicating the systems was by working with COSLA and responding to its very helpful feedback.

I thank the committee for its input to the resource spending review. As I have said publicly, this is a particularly challenging time to be setting out our resource spending review. We are recovering from the pandemic, there is an unprecedented cost of living crisis and there is very significant volatility in the fiscal outlook. When the UK Government published its spending review last autumn, which is the basis on which our spending review is drafted, inflation was 3.1 per cent. As members will know, just yesterday, inflation reached a height of just over 9 per cent—a 40-year high—and it is due to increase further.

Despite that, the reason why we proceeded with a spending review was to give our partners as much clarity and transparency as possible. The resource spending review sets out how we will spend £180 billion over the next few years.

In light of some of the challenges, we set out a number of priorities in order to focus where we would spend our money over the next few years. Those include the long-term ambitions of tackling child poverty, addressing the climate crisis, strengthening the public sector and growing a stronger and fairer economy. Despite the challenging circumstances, we have set out an ambitious spending review that maximises that £180 billion over those four key areas.

We have also chosen to prioritise social security in the spending review, and the social security allocation shows the strength of our commitment to building a modern social security system that has dignity, fairness and respect at its heart. Clearly, that will help us to meet our child poverty targets.

My last point before I stop is that it is obviously not a budget. Detailed tax and spending plans will still be a matter for the annual budget process. The spending review is, in essence, a planning document that shows our commitment to delivering on our key priorities.

I look forward to the committee’s questions.

I am very happy to answer that question. The priority at the time was to balance the need for effective targeting—you talked about the four groups of people—with the need to deploy that funding as quickly as possible. We consulted with the Convention of Scottish Local Authorities to understand how we could do that.

It is not often that politicians stand up and accept that processes or schemes are imperfect, but I am pretty sure that when I announced this I accepted that it was imperfect, but that it was imperfect for a purpose. That purpose was to get funding out as quickly as possible. We looked carefully at mirroring what was done with the low income winter payments that were deployed by local government during winter. That took months and months to deploy, and my view was that, in April, families did not have months and months to wait for funding. Therefore, although council tax is imperfect by design it was the fastest way to get money out the door.

The other element is that our council tax reduction scheme is unique in the UK; it does not exist elsewhere, and, if memory serves, it captures about 394,000 households on the basis of low income. It is based on not only property value, but income, so we could use it to reach families, including pensioners, who might not be in council tax bands A to D. The third thing that we did was to increase the fuel insecurity fund.

We sought to target as effectively as possible within the commitment that I made to deploy the funding as quickly as possible. I appreciated the ideas and suggestions that we received from a number of stakeholders, and they were all carefully considered, but all of them would have taken longer to deploy—probably six to nine months longer—and they did not reach as many people as possible.

Yes is the short answer. Shona Robison might have something to add on the policy question.

I do not have the figure in front of me, but I think that the funding will go up by about £100 million over the next five years. The funding is intended to provide a wraparound service for people who are furthest from the job market. That will include disabled people. It is a highly intentional investment that involves the very labour intensive and financially intensive process of working alongside people for 12 months and continuing to support them when they are in work.

I would be happy to follow up on specific policy areas but, from a financial perspective, I would make the point that funding is there. We must remember that such work—if we are serious about it—is extremely financially intensive.

As well as the moral imperative of supporting disabled people into employment, which you have identified, there is the economic imperative of doing so. Unemployment is at 3.2 per cent so, essentially, we are at full employment. We know how desperate businesses and so on are to find workers. Although economic inactivity, if I can use that phrase, is reducing—it is about 21.9 per cent, according to the most recent statistics—there are people in that group who would be keen to work if we can provide the right support. As well as having a moral impact, that would have a huge economic impact.

Those are the SFC’s assumptions, rather than mine.

I am happy to answer on local government, but it is probably a policy question if you want to answer it, Shona.

I am delighted to be welcoming the Chief Secretary to the Treasury to Edinburgh on Monday. We will be meeting to discuss both the spillover dispute and the fiscal framework. We are hoping to announce details about the independent report, which has to precede the review. We are a bit behind time, which is unfortunate, because that independent report should, theoretically, have been completed by the end of last year, and we should be in the review phase. We need to move as quickly as possible.

I am extremely keen that we get a resolution to the spillover dispute, which is about real money. There is a disagreement about the methodology to calculate what the Scottish Government is entitled to. The principle has been agreed—both Governments agree that the Scottish Government is entitled to additional funding as a result of UK Government policy changes on income tax. That principle has been conceded, but we are still in discussion about the quantum of funding, because that is not as clear cut. I have a duty to represent the Scottish Government in that regard, because if there is a principle in place, that raises a question of fairness.

The issue is very specific to my portfolio of finance and economy, in which the outlook—as is the case in every other portfolio—is very challenging. If you look at all the budget lines, you will see that the employability line is going up by a significant margin over the next five years. That is almost entirely driven by our commitments around tackling child poverty. Pam Duncan-Glancy has identified that we need to tackle the root causes of poverty. It is clear that employability has a key role to play in doing that. We want to support families who are not in secure, well-paid employment into such employment through the new offer to parents and the no one left behind approach.

I have identified our four priorities. The nature of prioritising is such that, if you prioritise one area, you have to deprioritise elsewhere. In my portfolio, that prioritisation is clearly visible in the employability line, which is intentionally designed to significantly expand employability services to help us to reach our child poverty targets.

I will give an example of something that we have tried to do. You will be familiar with CodeClan, which provides intensive retraining or reskilling for employees in digital skills. We intentionally supported it to open a facility in the Highlands that was specifically geared towards rural businesses. It was different from the CodeClan that is based in Edinburgh and was specifically geared towards rural businesses.

There are examples of things that we have done. However, it needs to go both ways. There must also be an appetite to embrace that. Whether it is the middle of Edinburgh or Skye, the same challenges exist around skills in a very competitive environment. If you think that there might be some ways in which we could adapt the digital boost scheme or digital grants to make them particularly relevant to rural areas, I am open to suggestions and ideas. However, it is a challenge across Scotland.