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Chamber and committees

Transport and the Environment Committee, 03 Oct 2001

Meeting date: Wednesday, October 3, 2001


Contents


Budget Process 2002-03

The Convener:

Agenda item 5 is the 2002-03 budget process. We will consider the draft transport and environment budget for 2002-03 and the Scottish Executive's response to the committee's report on the budget to the Finance Committee. We can consider the issues that we might want to raise with the Minister for Transport and Planning and the Minister for the Environment and Rural Development when we take budget evidence from them at our next meeting, on 24 October.

Members should have a copy of the committee's report to the Finance Committee on stage 1 of the Scottish budget, the Executive's response to the committee's report, a Scottish Parliament information centre note on the draft transport and environment budget and a copy of the draft budget—we can get that to members if required.

Perhaps the best way to proceed—once I have found my papers—would be to work through the Executive's response. Members can comment on that, the draft budget and the SPICe note.

What paper are you referring to?

The Executive's response to the committee's report to the Finance Committee.

Do you mean paper TE/01/24/6?

Yes—and annexe A, which gives responses to the committee's questions.

Is annexe A a response from SEPA?

The Convener:

The response is from the Scottish Executive environment department.

Do members have a letter from Sarah Boyack, the Minister for Transport and Planning, entitled "Stage 1 of the 2002-02 Budget Process: Report of the Transport & Environment Committee on the 2002-03 Budget Process"? That is the minister's response to our report and is probably a good place to start our discussions.

On page 1, the minister notes that:

"The Committee considers that the Scottish Executive document ‘Making it Work Together' does not adequately address the question of how the Executive arrived at the particular priorities it has identified."

The minister seems to respond that a lot of work that cannot be documented goes into the process, but that she is happy to answer questions on that work. Perhaps we can ask about that when we take oral evidence.

The comments on the Executive's annual expenditure report are self-explanatory. Members may have a different view.

On page 2, the minister mentions spending on roads.

What likely effect will the budget have on the road spending programme? Apparently, there are reductions.

The effect of the budget on the road maintenance programme is not a question for me to answer. We can ask the minister about that when she is with us.

Right—thank you.

The Convener:

On page 2, the minister notes that:

"The Committee considers that a clear correlation should be demonstrable in the Scottish Executive's budget documentation between the stated aims of the Executive and the allocation of spending."

That refers to earlier points on how the Executive makes up the budget. Again, we may wish to pursue the matter when we question the minister.

The minister agrees with us in her next point. She responds to our question on transport planning, and her answer to our question on the extent to which the budget proposals are influenced by the DETR transport plan 2010 is fairly straightforward.

As members have no other questions or points on page 2, I will move on to page 3, where the committee asks:

"what is the scope for ministers to set out their forward plans"?

The response is fairly straightforward—three-year spending plans and a framework for longer-term projects outwith that three-year spending programme.

The minister's next answer, on variance under the budget heads, is also straightforward.

The minister has replied that there is scope for variance, but not how much scope, which is what we asked. We could perhaps ask for a more detailed answer.

I add my voice to that. It would be useful to know how much scope there is for variance.

The Convener:

We will prepare questions for the Executive and will ensure that that is one of them.

End-year flexibility in the work of the Parliament is subject to debate elsewhere. The minister's response on that is straightforward. Considering the debates that we have had on EYF, I think that we have had enough discussion of that in other aspects of the Parliament's work.

The minister writes:

"in respect of worthwhile projects".

Can we ask how she assesses what constitutes a worthwhile project?

Indeed. There is a trail developing here, regarding the determination of policy, how that is played out and how priorities are set. We will ensure that we cover that.

I presume that no projects are not worth while.

Nora Radcliffe:

It might be interesting to tease out how much of the EYF is kept within budget heads and how much cross-fertilisation there is if there is something left over at the end. Is end-year flexibility retained in a budget and how much is one project prioritised over others, either under the budget heads or in other portfolios?

As you know, we have the general budget figures, but we do not have every line. Your question is based on EYF line by line and whether the minister allocates that across the budget.

If there is money left at the end of the year, does it stay in the pockets in which it began, or is it re-allocated between departments and, if so, are projects prioritised across all Executive departments?

The Convener:

We have covered some of that in other debates, but that is a relevant point to put to the minister in our question-and-answer session.

The minister has given a fairly lengthy answer to our question on the extent of the budget's reliance on private sector involvement. I seek members' views on other issues that they would like to examine under that subject heading.

As members have no further points to raise, I will move on to page 4, which details information on the distribution of responsibilities. If members want to pursue that, they can do so in questions. Does anybody have any points to raise?

I thought that we questioned the minister on the responsibilities of local authorities when she attended the committee previously. Should we reconsider how to ask that question to get the answers that we are looking for?

The Convener:

Murray Tosh was especially vociferous on the subject. You are right to say that we must consider whether we are asking the wrong question. I shall speak with Callum Thomson, who is well versed in such matters, and we will try to come up with another question on that subject.

The next issue is the balance of expenditure on trunk and non-trunk roads between the Executive and local authorities. That arises from the previous question we asked about who is getting the responsibility and where the money is coming from to undertake the work. The minister's response sets out the way in which she views the matter. We can also examine that in our questioning.

In response to our points about the evaluation and audit of aims, objectives and performance against targets, independent evaluation and performance management, the minister said that there is a system that will be applied.

If there are no comments on page 4 of the letter, we will move to page 5, which begins with remarks on Highlands and Islands Airport Ltd's landing slots at Gatwick airport. In the current climate, we remain interested in the issue.

Perhaps we should ask more questions about safety. Representations have been made to me about the lack of security at HIAL airports.

We will need to consider that in relation to the budget. Perhaps you should write to the minister on the matter.

I have done. There will be cost implications if safety procedures are to be tightened. HIAL has said that it feels that it has to have inappropriate safety procedures at its airports, but that might have changed now.

Fiona McLeod:

In pursuing that, can we be clear that there is a difference between safety and security issues? When we were talking to HIAL about the Civil Aviation Authority regulations, the focus was on safety rather than security, which is a different issue.

That is a fair comment. There are safety issues, but I am primarily concerned about security.

Both issues have an impact on the budget.

Are there any other comments on page 5?

I thought that it was an extract from "Yes, Minister" when I read it.

Was that all the responses to the HIAL questions, or one in particular?

I thought that some of the answers were not particularly illuminating in terms of the questions that the committee had asked. Was that not the general feeling?

The Convener:

When dealing with previous pages of the letter, we picked up specific concerns that we want to pursue. I think that the answers that deal with HIAL on page 5 are fairly straightforward. I suppose that it could perhaps be argued that the last response, which talks about how targets are measured, calls for further discussion. I do not share your view, Adam, but it is up to committee members to tell me what areas they want to investigate further.

I take it that we will return to the matter.

We will return to it at our next meeting, which the minister will attend. It would be useful if we could tell the clerks in advance the areas that we will want to discuss so that we can structure our debate.

I will do that.

Page 6 deals with the Strategic Rail Authority. I take it that we believe the Executive response to be fairly straightforward.

Mr Ingram:

The committee requested reassurance on the proportion of Strategic Rail Authority expenditure that will be spent in Scotland. The concern is that the vast majority of the money will be spent in the south-east of England, particularly around London. That is what the rail industry in Scotland believes. It is up to the Scottish Parliament, the Transport and the Environment Committee and ministers to try to extract as great a proportion of the funds as possible. The answer does not fully illuminate the point that was raised.

The Convener:

The answer shows where responsibility for the rail network lies. The Executive uses the present structure to deliver improvements to the Scottish rail network. It was a factual answer to a factual question. If Adam Ingram is not satisfied with the response on share and mechanisms, he can take that up with the Executive. The Executive's response reflects the way that the share was carried out and the structures that exist at present.

I wonder whether, in questioning the minister, we should find out more about the mechanisms that she is using to ensure that Scotland's bids get a proportionate response.

The Convener:

I recollect that we have had a number of discussions about share. We make no noise when the proportion of our share is over the national allocation, but we do when it is under the allocation. We must ensure that the Executive is representing properly the needs of Scotland. I am more than happy to pursue that with the minister when she gives evidence to us.

We move on to the next principal document, which is the Executive's responses in annexe A.

Before we go through the document, I understand that we did not receive responses from the appropriate ministers similar to those that were received from Sarah Boyack. Is that the case?

I am assured that the response in annexe A is all that we have received.

As a committee, we should write to the appropriate ministers and say that the responses are not good enough. In scrutinising the budget process, we want detailed answers to our detailed questions.

The Convener:

The document does not present the information as cogently as have previous documents. That view should be made known. To be fair, the response allows us to search out the issues that we raised. However, the document is not as user friendly or informative as were previous formats.

Fiona McLeod:

A lot of information is missing. One example of that, which jumped out at me, is the response to the questions that we put about the renewables obligation (Scotland). The answer is about SEPA and charging. It does not address the other questions that we put on the environment budget. That is not good enough.

The Convener:

We will perhaps revisit that issue in time for the committee's evidence-taking session. That would allow us to seek further information from the Executive on the issues that we raised. That said, I suggest that we move on to discuss the information that is contained in the document.

The last section of paragraph 3 on page 1 addresses the polluter-pays principle. That reflects our previous discussions on Blairingone and Saline. Do members have comments on paragraphs 1 to 4 on page 1?

John Scott:

I make the counter-point that members will note, from the table shown in paragraph 2 on page 1, that SEPA's income is about half and half grant in aid and revenue from charging schemes. The larger part of its income comes from grant in aid schemes. I assume that that income is government funded?

The Convener:

We must be cautious that public organisations such as SEPA do not have to be self-fulfilling about what they are doing. As long as they work to policy objectives and targets, charging schemes and/or grant in aid must be set to ensure that they are properly funded. The point is made.

Fiona McLeod:

In our questions to the minister, we should reiterate our view that, because of the polluter-pays principle, we are not against charging. However, we do not want to see grant in aid going down as charging goes up. That would mean that SEPA would have to rely on charging people rather than policing people.

We have made that point, and we can make it again. It is not to be a charge-led system, whereby charges are increased to fund core operations. I think that the committee has always accepted that.

John Scott:

It is perhaps worth noting that SEPA charges for the licensing of spent sheep dip. The matter has already been raised in the Parliament. We pay for that licensing process in Scotland, whereas nowhere else in the United Kingdom or the European Union is a charge made for the licensing of such a process. We are probably already paying more than other parts of the United Kingdom for the type of services that SEPA renders unto us.

I was unaware of the charging for the licensing of spent sheep dip and I thank John Scott for bringing that to the attention of the committee.

Robin Harper:

SEPA is already heavily reliant on charging schemes. The figures show that it is getting more money from them every year. I would rather that amount of money had gone down, with direct grant from the Government going up. That would allow SEPA to be more independent.

There is a counter-argument to that. If people are being charged for activities, it concentrates their minds on what they are doing. That relates to the polluter-pays principle. It provides, to a degree, a disincentive to pollute.

The Convener:

We will have the discussion in the chamber—I am not willing to referee it. Those points will be dealt with by the minister's responses to the committee's questions.

Let us return to the subject matter in hand and turn to page 2 of the response paper.

May I return to paragraph 4 on page 1? Could we ask for a more detailed list of the new charging schemes that SEPA thinks may be introduced during this budget period?

Sure. Is there anything else to raise on page 1? If not, we will move on to page 2.

Maureen Macmillan:

Sorry—if we could go back to paragraph 4, could we ask for more information on environmental taxes as alternatives to charging schemes? I would like to know more about how that would work.

I have just noticed that the paper says

"These are, however, reserved matters".

We could still ask about it, however.

The Convener:

Yes. We could ask what input has been made to the discussion on that.

I hesitate to ask this again, but do members have anything else to raise on page 1? If not, we will move on to page 2, which addresses our paragraph 46. The response is headed "Economic Efficiency", and discusses "cost effectiveness"—who could not agree with it?

Fiona McLeod:

I did not quite understand the end of paragraph 7, which reads:

"depreciation and provisions for future costs (which score before profit is calculated) and paid out as interest (paid out after profit is calculated)".

We are discussing the water authorities, are we not? Where is the profit in the water authorities?

I think that we were discussing the general budget and, presumably, the involvement of the private sector in some projects.

The paper mentions

"the resources generated from water and wastewater charges".

I got a bit lost when I noticed profit being mentioned more than once in the context of water authorities.

We will need to clarify that. I presume that that relates to how the water authorities report on projects. It they report a surplus, how is it calculated?

But a surplus is not mentioned; "profit" is mentioned twice in paragraph 7.

We will look into that and get it clarified.

Nora Radcliffe:

Perhaps I am venturing into murky waters, but does the rest of the committee think that it would be helpful to have a quick briefing on resource accounting and budgeting before we start cross-examining ministers? I find it difficult to get my head round RAB. Does the committee think that an idiot's guide to RAB would be helpful and would inform our later questioning, or would that go into too much detail?

I attended the all-members briefing on RAB.

So did I.

I think that I understand a fair bit of RAB—not all of it, I confess. I do not know whether we can arrange a briefing such as Nora Radcliffe requests. I will speak to the clerk about that separately.

When was that briefing session?

It was a long time ago.

It was when the Executive first introduced RAB. That was about a year ago.

It was about a year ago. It was held in committee room 2.

I confess that I too find it difficult to make head or tail of much of the paper. However, I would be the first to accept that that is my inadequacy.

For those who did not attend that briefing session—and for those who did, but who want a refresher course—we will endeavour to produce something on RAB to allow a greater understanding of it.

Is there not a Scottish Parliament information centre document on RAB? If there is, will the clerk send it to us all?

I think that SPICe produced something. We will search it out and ensure that members are aware of it.

I support what John Scott says. I look at paragraph 6 on page 2 of the paper and I cannot make head or tail of what it means.

We will endeavour to tell you the heads and the tails of it through the SPICe briefing, or, if that is not sufficient, a further briefing to the committee.

You, convener, might be willing to explain.

The Convener:

I am unwilling to explain civil service speak to you, because I would get into dangerous territory. I have not read the paragraph in much detail. I thank John Scott for that challenge. I will remember it.

Are there any other points on the paper? I will summarise, beginning with Fiona McLeod's point that the response is insufficient. We must approach the Executive on the matter again. We will include in our scrutiny of the Executive, when the minister comes to the committee, the comments that have been made on individual paragraphs.

John Scott:

The point has been made more than once that the distillation of all that we have said is that the paper must be couched in layman's terms so that we can all understand it easily. The point is not that we should need to understand RAB. The paper must be written in such a way that those who are demonstrably lay people—such as the committee's members—can understand it. The fact that it is not is a failing of the Executive's response.

That should lead to an interesting meeting.

Fiona McLeod:

When the ministers return to the committee to give evidence, will we restrict ourselves to the two main areas to which we restricted ourselves at the last such session or, if other matters have come up in the interim, may we question the ministers on those?

The Convener:

We will try to structure our discussions to meet our priorities in the first place. I acknowledge that other matters flow from the process. I am happy to try to deal with those. If you could indicate any such matters to the clerks, that would be useful in structuring our discussions.

Fiona McLeod:

One such matter comes to mind—the impact of foot-and-mouth disease on the environment and the environmental budget. We started to raise that at the first evidence-taking session. At that point, we were at an early stage of understanding the impact. Should we flesh that out a wee bit more?

The Convener:

That is a valid point, which—I hope—we will build into the session.

We will endeavour to include all the comments that have been made so that we can have a structured discussion on the budget with the Executive.

I thank the press and public for their interest.

Meeting closed at 11:13.