Finance Committee, 31 Oct 2006

Meeting date: Tuesday, October 31, 2006

Official Report 282KB pdf

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Scottish Executive Budget Review Group

The final item on our agenda relates to the budget review group. John Swinney flagged the matter up for discussion in the committee. I invite him to set out the issue.

Members have been supplied with copies of an e-mail that I sent to the clerk last week in connection with the Scottish Executive budget review—the Howat review. From the e-mail, members will see the description of the task that is involved, the remit of the review and the process that is to be undertaken. At the end of the document, members will also note the following reference to the Finance Committee:

"This is an exercise for Scottish Ministers. However, in its role of scrutinising the Scottish Budget process, it is possible that the Scottish Parliament's Finance Committee may choose to seek evidence on the report from the reviewers."

I invite the committee to consider how we should deal with that part of the explanation of the group's remit.

Members will be familiar with the history of the issue. At our meeting in Elgin about a year ago, we were given a commitment that the report would be published. That was reiterated in the chamber on at least one occasion by the Minister for Finance and Public Service Reform. In the past few weeks, we have been advised that the Executive does not intend to publish the report until after the conclusion of the spending review in September 2007. That is obviously a change of position. The committee was led to believe one thing and we are now being asked to deal with another.

There are implications of our not having oversight of the review at an earlier stage. Our adviser has said that its publication date in 2007 will be after most of the key decisions have been made, so we will have the report after the event rather than during the process. A commitment to publish was given by the Minister for Finance and Public Service Reform in November 2005. Our not getting the report is inconsistent with the open and transparent approach to the budget process that the committee has asserted, for years, should be followed.

My proposal is that the committee should agree to invite representatives of the Howat review group to give evidence on the contents of their report on the Scottish Executive budget at a time that is convenient, to be arranged by the clerks.

Will you clarify your proposal, John? I understand that the Scottish National Party has chosen the budget review as a topic for debate on Thursday, but no motion has been published yet. Can you enlighten us as to the motion that will be under consideration? That might inform our debate here.

It is likely that the motion to be debated will request that the Executive publish the Howat review. However, as you will appreciate, I am not the one who will determine the final contents of the motion.

The difficulty that we face is that any decision that we make today may be superseded by a decision that is made on Thursday. Therefore, it might be better for us to defer consideration of John Swinney's proposition until such time as Parliament has debated and voted on the motion that is likely to be lodged. That would seem to me to be the logical way of dealing with the matter.

I think that John Swinney's suggestion has merit regardless of the outcome on Thursday. There are two conceivable outcomes of Thursday's debate or of the Executive taking unilateral action: either the report will be published or it will not. If the report is published, no doubt it would be useful to seek clarification from the group that prepared it and, if the report is not published, our scrutiny of the budget would be better if we were able to have access to some of the information that the Howat committee acquired as it prepared the report. Proper parliamentary scrutiny of public spending in Scotland can only be enhanced by the proposal.

I am inclined to agree with Derek Brownlee and John Swinney. There are two separate issues. One is to do with the publication of a report that, according to the milestones, should have been completed in February 2006; the other is to do with the Finance Committee taking evidence from the members of the review group. Given that those issues are separate, I do not see that there is an overlap between the decision that Parliament might take on Thursday to request publication of the report and the Finance Committee's right—which is laid down in the remit—to seek evidence on the report from the reviewers. No doubt, they will have issues that they are not able to discuss, but I think that it is appropriate for us to take up the right that is set out in the document that John Swinney e-mailed us.

I think that your assessment is correct, convener. It would appear that we are trying to go down two tracks at one time. Mark Ballard has indicated that he sees the two issues as being separate, but I do not know how he can say that, given that the SNP has not yet lodged its motion and he does not yet know its terms.

I agree with John Swinney, of course. I am keen for any available evidence that might help us to scrutinise the process to be made available to us. There is a clear sequence to be followed and John Swinney has taken the first opportunity to bring the issue to the committee. It is incumbent on us to make a decision on the matter. Later this week, there will be a debate on the matter and, clearly, a decision that is made by this committee would inform the motion that is debated. It would be a sad day if the Finance Committee were to kick the matter into the long grass and postpone the process.

I do not think that taking a decision next week instead of this week would be kicking the matter into the long grass. If I were to be cynical, I could say that the proposal is an attempt to bounce members of the Finance Committee into making particular decisions now that might be embarrassing in a couple of days' time. I would not suggest that that is happening, but it is possible that it might be.

I have a practical question about possible constraints on what the reviewers are able to tell us in view of the report not having been published. Given that they are paid by the Executive, will they be able to discuss the review with us? In calling them, would we be putting them in a difficult position? People might prefer to put the Executive in a difficult position because it has not taken the opportunity to publish the report.

My proposal would be to take evidence from the members of the Howat committee once their report has been published. The decision on whether or not to publish it is presumably one not for this committee but for ministers, bearing in mind the will of the Parliament when it is tested on Thursday. I suggest that we take evidence from the reviewers when the report is published. I am happy to make that a formal proposal. If John Swinney wishes to put an alternative proposal, we might just need to go to a vote.

I will respond to Elaine Murray, who asked whether the people behind the report will be able to discuss it. I am not in a position to judge that, but the Howat committee was given a remit by the Executive. I presume that the individual reviewers, when they are invited by the Finance Committee to give evidence, will be in a position to respond to that request. I have no clearer statement on that than what I got from the Scottish Executive in the description of tasks that is contained in the paper that I have in front of me. It is clear that, whenever that paper was written, the Government's view was that there should be open scrutiny of what was going on.

That brings us to the central question of whether this exercise should be informing the budget process. The Government has stated:

"in its role of scrutinising the Scottish Budget process, it is possible that the Scottish Parliament's Finance Committee may choose to seek evidence on the report from the reviewers."

Therefore, the Government obviously considered that the matter would have some impact on the Finance Committee's work in scrutinising the budget process.

I think that it is entirely natural that the committee should ask for the information to be made available to it in time to inform the budget process. My proposal assumes that the committee gets access to the necessary information to allow it to question and scrutinise those who have been involved in the Howat review and to make a decision in the light of that.

The convener has made a counter-proposal about taking our lead from the Parliament. The Finance Committee is involved in an on-going, detailed set of discussions with the Executive about the scrutiny of public finances. We are the ones who get our hands dirty investigating such issues and the details of the budget. We are the ones who were told by Tom McCabe that he would make the review document available to us. It is entirely reasonable for us, when given the opportunity, to ask for the information to be published. We are the ones who have been told that it will not be published. For the matter suddenly to be deferred to a debate in Parliament, while we are the ones who have been in the mix on the whole issue, is a rather strange route to take.

The committee has been so active in pursuing the issue over a long period. My proposal, that the committee agrees to invite the Howat committee to give evidence on the contents of its report on the Scottish Executive budget, is entirely consistent with the long-standing interest that the committee has taken in the issue.

I take John Swinney's point about what was said in the advert that the Scottish Executive put out. At the time, the report was expected to be published in February this year. I am sure that there is shared disappointment that that did not happen—there would have been a document on which we could have taken evidence. However, it would be difficult to indulge in some sort of fishing exercise with the people who were involved in the review group without the report having been published, which would put them in an awkward position. We would be trying to find out the information that we would have liked to have been published, but the review group members would probably be constrained in some ways, as their conclusions will have not been made public.

When the Howat committee's initial remit was published, the expectation was that the spending review year would be this year; in fact, it is next year. We must take account of the fact that the initial specification was written with the expectation that the spending review year would be 2006-07, rather than 2007-08.

If I were John Swinney, I might also have taken this route, but the point that Elaine Murray made is the overriding one. It would put the authors of or contributors to the report in a completely invidious position if we asked them to provide evidence to the committee before the report was published. That is discourteous and inappropriate. There is no precedent for a committee deciding to ask the authors of a report to give evidence to it because the report has not been published by those who commissioned it. If we can resolve the matter only through a vote, let us have one. There will be no hard feelings thereafter. People must make a judgment on the issue.

As Wendy Alexander knows, there is nothing discourteous about my intentions.

I appreciate that.

I know—that is beyond question. However, there is a duty on the Finance Committee to get to the nub of the issues that are at stake. Wendy Alexander said that there was no precedent for asking people to appear before committees when reports have not been published. I cite the Justice 1 Committee's summoning of the former deputy chief constable of Tayside police, James Mackay, to provide information on the so-called Mackay report, which had not been published. That is not a particularly happy example, because the Lord Advocate instructed Mr Mackay not to answer questions on the unpublished report. Anyone who observed that escapade will realise how inappropriate the Lord Advocate's decision was.

We are always being told about the importance of open and transparent government. Ministers published a document that stated that the committee would be entitled to take evidence on the report and that they intended to publish it. After failing to tell us that they had changed their mind—we read that in the newspapers—they are asking us to accept that the report does not matter and that we should wait not until a material point in the spending review but, as our professional adviser has told us, until most of the major decisions on the review have been taken. If we do not take evidence on the report, we will miss an opportunity properly to scrutinise the Government.

My proposal, which is for the committee to take evidence on the report once it has been published, will be the second proposition for the committee to consider. I invite John Swinney to clarify his proposition, so that it can be put to a vote first.

My proposition is, that the committee agrees to invite contributors to the Howat review to give evidence to the Finance Committee on the contents of their report on the Scottish Executive budget.

The question is, that John Swinney's proposition be agreed to. Are we agreed?

No.

There will be a division.

For

Ballard, Mark (Lothians) (Green)
Brownlee, Derek (South of Scotland) (Con)
Mather, Jim (Highlands and Islands) (SNP)
Swinney, Mr John (North Tayside) (SNP)

Against

Alexander, Ms Wendy (Paisley North) (Lab)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Murray, Dr Elaine (Dumfries) (Lab)

The result of the division is: For 4, Against 5, Abstentions 0. The proposition is disagreed to. Therefore, is my proposition agreed to?

Members indicated agreement.

The substantive position is that we will take evidence on the report once it has been published.

I remind members that our next meeting will take place in Dumfries on Monday. An e-mail has been circulated that shows the allocation of members to workshop groups. If members want to change round, it is up to them to swap with one another. We have been asked to think about who should chair each workshop, so I suggest that members speak to the people with whom they have been bracketed in the clerk's memo. I remind members that the fact that we have a day in Dumfries on Monday does not mean that there will be no meeting next Tuesday—unfortunately, there will.

Meeting closed at 12:29.