Item 3 is consideration of interim draft guidance for subject committees on the budget process 2008-09. We usually produce such guidance once the draft budget has been published but, given that the process has been delayed this year by the delay in the United Kingdom spending review, the committee agreed that it would be a good idea to produce early interim guidance. Of course, once the draft budget is published, Professor Bell—our adviser—will produce further guidance for the committee.
On paragraph 4, which relates to links between committees, I believe that it was suggested that subject committees might consider appointing reporters to take forward budget scrutiny. Indeed, I think that the same point was mentioned in the previous item.
It is mentioned in paragraph 5.
Sorry—I missed that.
We can raise that question with the adviser, who made the suggestion.
Surely the matter is more the province of the Scottish Executive. As I say, the Atkinson review relates to the UK.
You make a good point, which is much appreciated.
Again, in paragraph 4, I was concerned about how we would look at equity "through space". Would we boldly go where no one has gone before? Instead of referring to equity
I think that we can clarify that point.
I am not so much suggesting changes to the paper as flagging up two issues that arise for subject committees. I attended the Conveners Group away day and heard Susan Duffy and David Bell talk about the suggestions that are set out in paragraph 4. Subject committees are discussing budget advisers and what to do about budget scrutiny, and those discussions are dictating the nature of the advisers whom they choose to engage. Despite what the paper might say about waiting until advisers are in place, committees might already have made some of these decisions and have second-guessed the contents of any strategic overview of the situation. For example, in the light of our decision to focus on the agricultural elements of Richard Lochhead's announcements in June, we on the Rural Affairs and Environment Committee are looking for a budget adviser who has specific expertise in that area. I am simply flagging up the fact that decisions are being made now and that it might be advisable for David Bell to be a bit more proactive early on. If he is not, he might face a fait accompli as far as the committees are concerned.
This is just the beginning of a system that we hope will be of great assistance to all the committees, but the question how it is to be resourced is obviously of crucial interest. I hope that committees would look in the medium to long term to using a system involving the adviser to the Finance Committee and a team of other advisers. I take Roseanna's point about committees moving into early action, but I hope that all committees will also be thinking about the medium to long term and getting a system that is viable, funded and working for the longer-term view.
There are two different issues. The adviser for the budget scrutiny is specific, short term and set for a certain number of hours. The mainstreaming of financial scrutiny is different: it would involve year-round budget advice and perhaps changing advisers depending on what the committees were considering.
What you are saying in flagging up those points is appreciated. However, the previous Finance Committee agreed to examine the whole question of financial advice, and we are trying to encourage finance always to be part of consideration. In the past, committees have tended to examine the politics of issues and finance has almost been an afterthought. The previous committee recommended that we consider funding and how we could set up such a system. Your comments are apposite, however, and will be taken on board, Roseanna.
I want first to take up some of the points that Roseanna Cunningham raised. I have never been a member of a subject committee, so I do not have experience of that side of the fence. However, mainstreaming financial scrutiny in the week-on-week work of committees is a different scale of task from just looking annually at the budget process. We have a tension between the £30-odd billion that the Government spends annually and the limited resources that are available to the Parliament and its committees to do their scrutiny work.
That is a good point—it is something that a budget adviser could look into. I very much accept that we are certainly not here to overplay our hand in any shape or form, but our task is to encourage suitable action in order to ensure proper financial scrutiny. We are entering a period in which finance will become increasingly scarce. We have got to be careful that every public pound is spent to the best effect.
This may pick up on Elaine Murray's earlier point about the reference to space. There was a discussion at the away day about engaging the budget against the objectives of sustainable growth in the Scottish economy as a cross-cutting feature. I do not know whether that would better be included in the work programme or in the guidance under paragraph 4 of the budget process paper, but it seems to be absent from both.
That is a good point. That is an area that we will consider specifically when we get into budget scrutiny.
My point concerns what Derek Brownlee said earlier about committees, in relation to paragraph 6 of the paper. The comment had been made about committees not being able to cover their entire portfolio. Paragraph 10 suggests that committees should decide which area of the budget they are going to consider. We need to tidy up our thinking on that. Are committees going to consider one area of the budget or take a more detailed approach?
I made a similar point to James Kelly's, but to follow on from Derek Brownlee's earlier point, it will not be possible for subject committees, particularly the large ones, to consider every area of the budget. We should perhaps encourage committees to consider where there are changes in spend that reflect the priorities of the new Government. What is going to be most interesting is whether money that has been transferred from one area to another—even within a budget—demonstrates the Government's priorities, which may at the same time demonstrate the areas that are no longer considered to be as important. Some of that will come out of Howat, to the extent that the Howat recommendations are taken on. However, while we should not perhaps tell committees what to do, we would all have an interest in seeing who are the winners and losers in the budget this time around.
On the wording of the paper, we should be more open by simply asking the subject committees to examine the budget as deeply as they can. Clearly, subject committees have other priorities as well, so to say that subject committees should look only at what the Government is doing suggests that they should not look at what was done before—
I was trying to say that subject committees should make those comparisons.
We need to find the correct wording, as Derek Brownlee suggested earlier, about encouraging subject committees to engage with the process of finance. However, it should be up to subject committees to decide how deeply they go into matters.
I clarify that I meant that subject committees will need to consider the budget that was set by the previous Executive and the changes that the new Government has introduced, which will highlight the policy differences. The previous Finance Committee tried to get a grip on the issues by trying to tease out how the money followed the Government's priorities. That is important whoever is in Government.
I have less difficulty with paper FI/S3/07/3/3 than I had with paper FI/S3/07/3/1 simply because the paper provides some context on why we are suggesting that a subject committee should not necessarily look at its entire portfolio. My point is that, during a spending review year, someone needs to take an overall view. The wording in the draft guidance states:
It must be understood that subject committees will make their own decisions about their priorities for investigation. If they choose to investigate a specific budgetary line to the exclusion of others, that is their choice. Although subject committees may take on board the advice and suggestions of the Finance Committee, the fact is that subject committees are making up their minds right now and are proceeding accordingly. Notwithstanding that this is a comprehensive spending review year, the suggestions in the draft guidance are probably much more for the longer term. My committee has already made a decision and we have not seen the guidance. Given the timing, it is a moot point what impact the guidance will have this year. We should remember that, ultimately, subject committees make up their own minds about their priorities.
Absolutely. However, the Finance Committee has a duty to point out the need for budget scrutiny to ensure that the finance matches the policies that are adopted. Otherwise, budgets quickly go awry. We want all committees to realise the importance of financial matters and to investigate them fully. In the past, committees tended to consider only the politics of the situation so financial memoranda tended to go through without much scrutiny. Given that there will be tighter finances, we need to work as an organised system by working together and using advisers, who are there to help committees.
Meeting closed at 14:29.