The next item of business is a debate on motion S7M-00249, in the name of Jenny Gilruth, on wealth taxation for public services. I invite members who wish to speak in the debate to press their request-to-speak buttons.
14:40
I am conscious that the Minister for Public Finance, Hannah Mary Goodlad, will give her first speech in closing the debate. Hannah Mary’s victory in Shetland was one of the biggest highlights in the Scottish National Party’s recent election victory. Colleagues will have observed, as I did, her energetic approach to winning round the folk of Shetland. Ms Goodlad has secured her seat at the table. I know that I speak on behalf of the whole SNP group when I say how delighted we all are to have her with us.
At the heart of the motion is a simple but important principle: taxation plays a vital role in funding our public services. The Scottish Government believes strongly that the way in which we use our tax powers must be fair, progressive and sustainable. Put simply, the cut that the Government takes from every pound that our citizens earn should be about making our society better for everyone.
Context matters, of course. The Scottish Government’s finances do not exist in a silo, insulated from events elsewhere. Whether it be Brexit, the illegal war in Ukraine, inflationary shocks, Westminster austerity or the recent conflict in the middle east, we operate against a backdrop of prolonged economic turmoil. All those factors have placed enormous pressures on public and household finances in recent years. However, despite the financial challenges, the Scottish Government has been able to deliver for our people, as the election results in May confirmed.
A key theme in the election campaign, which cut across most parties manifestos, was how we all proposed to alleviate the cost of living crisis. Across Scotland, the people we all represent are finding it really tough. The food shop is up, gas and electricity bills are up and rent or mortgage payments are up again as inflation remains too high. Regardless of party, our collective priority as a Parliament should be about making a difference to improve the lives of the people we all represent. We are not much divided in this Parliament on that aspiration.
The Scottish Government believes that the people who earn the most have the broadest shoulders and should be expected to make a fair contribution to support the running of public services. That means that we have been able to raise an extra £1.8 billion to support our public services.
I welcome the minister to her new role. How does she explain Scotland’s economic performance gap?
As Mr McKee is whispering in my ear, the economy is growing faster in Scotland than in other parts of the United Kingdom. In part, that is a result of our approach to a progressive taxation system, which I will go on to talk about, because it benefits our society. I know that Mr Hoy is really engaged in that, because we need to work together on how we can help to support our constituents, regardless of party.
We have also been able to fund new policies, such as the Scottish child payment, which is helping to keep the level of child poverty in Scotland lower than it is in the rest of the United Kingdom. Indeed, University of Oxford professor Danny Dorling has described the Scottish child payment policy as a major contributor to the largest reduction in child poverty anywhere in Europe since the fall of the Berlin wall.
I reflect, and I am sure that we will hear, that there is a general feeling among some of the Opposition that our approach to social security is out of kilter. Some parties would rather take from the vulnerable by making cuts to social security benefits to fund lower taxes for those with more, but the financial challenges that this country faces were not created by the poor.
The SNP Scottish Government will never target those with least to give. Since the Social Security (Scotland) Act 2018 was passed, we have established a radically different social security system that is built on dignity, fairness and respect. Our investment in social security supports our national mission to end child poverty. It helps to support poorer families. It helps to support unpaid carers. It helps to support old folk to heat their homes. Social security allows disabled people to live independent lives.
Rather than taking from those who are already struggling, we believe that the wealthier should pay a little more. I refer to people who are on higher than average salaries, like you, Presiding Officer, me and MSPs across the parties. I doubt that we would hear critique about that from the public.
One of the minister’s predecessors was famously completely unaware of the principles of the Laffer curve. What is her view on that theory and whether it impacts on what she says?
Mr Flynn has provided me with an analogy with the Laffer curve: it went up and then it fell back down. I am not sure whether Mr Kerr would agree with that analogy. I am more than happy to have a discussion with him and, of course, with Mr McKee, the Cabinet Secretary for Public Service Reform, on the Laffer curve. I know that Mr Kerr takes the matter very seriously, as he has spoken about the Laffer curve on many occasions in Parliament.
It is the case that taxation helps us to improve people’s lives. However, for taxation to be truly effective, it must do more than raise revenue; it must also create the right incentives to work, to invest and to grow the economy. On that point, I hope that there is greater opportunity for political consensus.
Fair and progressive taxation is not a barrier to growth. In fact, it is the foundation of a productive economy—funding the infrastructure, supporting the workforce and providing the stability that businesses depend on. That is why—
Will the Deputy First Minister take an intervention?
I will take Mr Marra, but I am conscious of the time.
I appreciate that the Deputy First Minister has given way. In these matters, she and her predecessors have taken advice from a tax advisory group. Can she update us on the status of that group? Will it be maintained, and when will it next meet?
I think that Mr Marra is referring to the Scottish Fiscal Commission.
No—the tax advisory group.
Okay. I would like to come back to Mr Marra in greater detail on that. I met the Scottish Fiscal Commission earlier today and we will continue that engagement. However, we are looking at a range of ways in which we can better engage with businesses. Mr Marra might be aware of some of the First Minister’s comments about our engagement, particularly with business, in recent weeks; I will come on to that. To give Mr Marra some comfort now, I will say that the Government will be voting with the Labour Party on its amendment to the motion today.
More broadly, following the election, we need to look at engagement in the round and consider whether that is the best context. Without making a decision on my feet today, I give Mr Marra an undertaking that I will write to him. I was in a discussion with the First Minister earlier today on those matters, and I do not want to prejudge the outcome of that.
We have to grow the economy—we all understand that—but the Government is not focused on tackling child poverty to the detriment of economic growth. Rather, that economic growth creates the necessary conditions whereby child poverty can be eradicated. It is not growth for its own sake, but growth to help support our people. We are rightly focused as a Government on creating the conditions for that growth, by supporting good jobs, attracting investment and maintaining high-quality public services. That is exactly why, as I said to Mr Marra, the Government will support the Labour Party’s amendment.
Ultimately, economic growth underpins all that we do in relation to fiscal sustainability. By boosting employment and investment, we expand our tax base, which in turn helps to fund the public services that our people rely on.
We know that, alongside growing the economy, reform is essential. That is exactly why the First Minister has appointed Ivan McKee to lead this work at Cabinet level. Yesterday, the First Minister and I met all senior civil servants in the Scottish Government to talk more to that mission. Next week, alongside Mr McKee, we will meet the leaders of our public bodies on exactly the same subject matter.
The public finances are challenging, and I do not shy away from that reality. However, there are opportunities here for more efficient ways of working. There is cross-party support to reduce the number of public bodies in Scotland, and I am sure that colleagues will engage with Mr McKee directly on that.
Colleagues who served in the previous session of Parliament will recall that we reinforced our commitment to ensuring that the public finances are on a sustainable footing through the medium-term financial strategy, which was published last June. Thanks to the decisions that were taken by the Government, more than half of Scottish taxpayers—as we heard during First Minister’s questions—are now expected to pay less income tax in 2026-27 than they would if they lived in England. We will keep it that way over the course of this session of Parliament. Unlike in other parts of the UK, our people will continue to benefit from free tuition, free prescriptions and no peak rail fares. Having applied that progressive approach to residential land and buildings transaction rates also ensures that those who buy the most expensive properties pay proportionately more tax.
On council tax, we are continuing to work with local government to build cross-party agreement on the future of council tax in Scotland. This Government exists in a Parliament of minorities, so I recognise that we need cross-party support to allow reform to be delivered on council tax, but I also recognise that council tax is a regressive form of taxation. We will, therefore, publish analysis later this year that will help to form an evidence base to inform any wider reforms, subject to Parliament’s support.
We have also given councils much greater flexibility to increase the charges for second and long-term empty homes, ensuring that, where housing is owned as a form of wealth rather than a lived-in home, more can be charged for it. On non-domestic rates, the basic property rate is the lowest it has been since 2018-19, and the small business bonus scheme remains the most generous of its kind in the United Kingdom.
However, we are now reaching the limit of what we can do with our devolved taxation levers. The UK Government has the powers to tax wealth far differently than it has done, but it has chosen instead to take short-sighted decisions, such as the decision to increase employer national insurance contributions, which has damaged the economy and created additional pressures on public services. If the UK Government is not willing to instil fair and progressive change in that area, it should give the Scottish Government the powers to do more. In the meantime, we are determined to do all that we can with the limited powers that we have. That includes aiming for a better balance between taxation of labour, income and wealth.
Scottish income tax provides about 80 per cent of devolved tax revenues, and our policy choices since devolution have resulted in the most progressive income tax system in the UK. However, we want a tax system that is even more resilient and gives us a broader set of tools to respond to economic shocks and future fiscal challenges. We are already taking action where we can. We are delivering on our commitment to introduce air departure tax in April 2027 and, through this framework, we will introduce a private jet tax from April 2028. We know that private jets produce significantly more—
Will the cabinet secretary give way?
I am happy to do so for Mr Rennie.
I have been listening carefully to the cabinet secretary’s contribution. She has, in passing, referenced the challenging fiscal set-up, but most of what she says sounds as though she will increase taxes to close the gap. Is that what she is implying?
I regret that, like his colleague Mr Cole-Hamilton, Mr Rennie has perhaps not been listening to what I have said. To clarify on the record, I note that those are not the comments that I have made today.
We need to look at other, broader opportunities to raise revenue in Scotland. There is a significant fiscal challenge ahead of the Government; the Opposition is well aware of that. I have seen Mr Rennie’s amendment to the motion, which is very critical of where we are currently. However, we exist in a Parliament of minorities, so we have to work together to address the budget gap. That is why Mr McKee’s role is so pivotal in terms of the efficiencies and reform that he will have to drive.
More broadly, the Government believes that those who enjoy the privilege of travelling on private jets should make a fairer contribution to the public finances, but we want to go further, which is why we are seeking the devolution of further powers to address the issue of private jet ghost flights. When a private jet completes a one-way trip, it often flies on to its next location with no passengers. Air departure tax is a tax on the carriage of passengers, so such flights would be exempt from it. However, those flights still produce emissions and support the activity of the super-wealthy. With estimates suggesting that up to 41 per cent of private jet flights take off without passengers, it is only right that we explore every possible opportunity to bring that activity into the scope of our progressive taxation system, and we call on the UK Government to devolve the powers to allow us to do so.
We are improving fairness at the top end of the council tax system, which is allowing us to raise additional funding to support our public services. Currently, some high-value properties face council tax bills that are not materially different from those for far more modest homes. From April 2028, we will introduce new council tax bands for properties that are worth more than £1 million.
In our tax strategy, we have committed to exploring the reforms that are needed to continue to deliver more sustainable and growing tax revenues in the future. That includes considering the balance of taxes across labour, income and wealth that I alluded to previously.
To shape those next steps, we are opening up a broad, evidence-based conversation on how Scotland can tax wealth more effectively, bringing together experts and stakeholders from across the country. That work will look at new approaches to wealth taxation and at the opportunities and challenges for a fairer and more sustainable tax system. I extend an invitation to the Opposition to work with the Government on that and to be part of the broader discussion, so that we can find consensus as a Parliament on those matters.
We know that meaningful reform of wealth taxation in Scotland would need significant co-operation from the UK Government and a fundamental change in relation to where the powers sit. Indeed, as the Scottish Green Party acknowledged in its manifesto, the prospect of a Scottish wealth tax would be feasible only with independence—or at least with the agreement of the UK Government to further devolve those powers. Of course, the Scottish Government would far rather that those tax powers were devolved back to Scotland, because an independent Scotland would give us the power to redesign—with the people and businesses of Scotland—our wealth taxation and other far-outdated taxes to work more effectively.
The pressures on our public finances are real, and the constraints on what we can currently achieve are significant. I ask parties to engage constructively and openly with the Government about what further steps we can take to consider the right balance of taxation for Scotland. The Government is committed to ambitious reform to reduce costs while increasing the effectiveness of our public services and achieving better outcomes for our citizens.
What I am asking the Parliament to do today is to empower us to continue to implement a progressive taxation system—a system that asks the wealthiest to pay their fair share while helping the poorest to make ends meet, which supports our businesses to drive the economic growth that is needed and which allows us to deliver better public services for our people while supporting those who are most in need.
I move,
That the Parliament believes in fair, progressive and sustainable taxation to support the delivery of public services; welcomes the progress made towards the creation of a private jet tax and a mansion tax; supports actions to go further and seek the powers necessary to take action on so-called ghost flights of private planes; recognises that Scotland’s current powers limit the scope for additional wealth taxation, and endorses the Scottish Government’s plans to explore what further steps could be taken either within the current system or with full fiscal powers.
I remind colleagues that there should be no interventions or interruptions during a first speech. I call Kim Schmulian to speak to and move amendment S7M-00249.2 in her first speech.
14:54
Thank you, Deputy Presiding Officer. I join other members in welcoming you and your colleagues to your new roles.
I congratulate those members who have been re-elected and those, like me, who are joining the chamber for the first time. I extend particular good wishes to my fellow Glasgow MSPs. Despite our obvious differences, I am sure that we can all work together when required, and I look forward to that happening. I thank the many thousands of people across Glasgow who voted Reform, searching for something that other parties were not providing—a new way for a new time.
I also extend my thanks to the cabinet secretary for her speech. However, she will not be surprised to know that I do not agree with most of it.
As this is my first address to the chamber, I would like to share a little of my background. A small glimpse into a person’s soul, I find, gives a sense of perspective on their approach to life and to politics. I grew up in a council flat in Haddington, East Lothian, the youngest of four daughters. My father was a labourer and my mother was a secretary. Times were often tough. I remember my father’s face when work was scarce and he had to sign on at the buroo, as we called it then. I understood then, and I believe now, that a person’s dignity is bound up in their ability to bring home a wage. When my father could not do that, it was written all over him. That stayed with me and it shapes everything that I believe about taxation, work, education and the role of Government.
I know what it means to work hard, to build something and to understand what ordinary families are really facing. That background is not incidental to why I am here; it is the reason why I am here. Those views mirror what I heard from Reform voters on the doorstep—they said it, and I certainly got it.
So, to the business of the chamber. The most obvious task that I have is to play a part in holding the Government to account. That begins today. In the weeks since I entered the Parliament, I have watched the long arm of the state extend further still. The SNP Government has set about its manifesto commitments with enthusiasm, and that arm has been lengthening since its first majority Government, with no sign yet of restraint.
My first impression has been clear: “profit” is a dirty word here, and the answer to everything is to tax the rich, even when there is no evidence that that has ever worked. I do not believe that “profit” is a dirty word. It is what drives us forward. It becomes a problem only when Governments fail to use the powers that are already at their disposal—competition law and regulation—to prevent abuse and excess. The answer is not to punish success; the answer is to govern well.
This week, the Institute of Chartered Accountants of Scotland confirmed what Reform has argued throughout: Scotland’s six income tax bands act as a disincentive to work. As a small country with a small population, we have constructed one of the most complex devolved taxation systems anywhere. Reform believes in a simpler structure: lower taxes, a freer marketplace with less regulation, and our economic growth driven by the spirit and enterprise of our people. That is how we fund public services sustainably and without punishing aspiration. We do not believe that the answer is always to spend more money, particularly when there is no hard evidence that it is making anything better.
There is a reality that the Parliament must face honestly: Scotland has a structural deficit. Everyone here knows it. The public deserves honesty about the need to bring spending under control—not more commitments that we cannot afford and not more taxation that drives away the very people and businesses that we desperately need here.
That brings me to today’s motion—yet more tax that Scotland does not need. Let us be clear about the constitutional reality: the Scottish Government’s powers on taxation are limited, and those powers have already been pushed to their limits. At almost every earnings level, Scots already pay significantly more income tax than those south of the border. Higher council tax bands for properties worth more than £1 million are in the pipeline. The devolved tax levers have all been pulled and still it seems that it is not enough.
Wealth taxes do not work. The evidence across every jurisdiction that has tried them is consistent. They distort behaviour, reduce investment and raise considerably less than projected. Why is that? It is because capital is mobile. People with the means make choices. They move, they restructure and they invest elsewhere. A thriving economy is not built by making the country the most expensive place to succeed.
I want to go further than the economic, because there is something deeply personal at stake here. We are talking about the homes for which families across Scotland have worked and saved for decades—the nest eggs set aside for children so that they might not have to struggle as hard as their parents did; the asset that might one day help to meet the cost of care in retirement, which is already a source of enormous anxiety for so many families.
In England, where a similar property threshold was set at £2 million by another well-intentioned left-wing Administration, we can see that the policy is backfiring. The housing market is feeling the effects, and the cruellest consequence will come when elderly people are forced to release equity from their homes not only to fund help with care but to meet that unfair and poorly designed tax. People who did everything right—people who worked hard, saved hard and planned for the future—are being let down at the last hurdle. The Government’s proposed tax is not a progressive tax; it is a betrayal.
The Government’s motion is well intentioned but mistaken. Scotland does not need more taxation; it needs growth, enterprise, honesty about our finances and the courage to make different choices. I am proud to oppose the motion.
I move amendment S7M-00249.2, to leave out from “believes” to end and insert:
“notes the data published by HMRC and research by the Institute for Fiscal Studies, which show that each 1% increase in income tax results in a 0.77% reduction in tax revenue; believes that this acts as a disincentive to growth and contributes to economic stagnation and loss of opportunities for everyone; further believes that increasing taxation for some people has a wider impact on everyone; considers that evidence suggesting that, in retrospect, increases in wealth taxes can lead to a significant flight of tax revenues, contradicts previous assessments by the Scottish Fiscal Commission (SFC) that increasing taxation would result in only a minimal flight of tax revenue, and calls on the SFC to review its approach to modelling of using contradictory real data against its hypothetical forecasts.”
15:01
Labour welcomes the early opportunity to debate the scale of the fiscal challenge that the SNP has created for Scotland. The £4.7 billion gap between the spending trajectory that has been set by the Government and the income that the Scottish Fiscal Commission has projected will be generated is vast. How that gap is tackled will be the defining issue of this session of the Parliament, and it will affect everything else that we do.
We might all wish that that process will involve arresting the decline in standards when it comes to the ability of our schools to best equip our nation’s children for their futures. Perhaps we could start by understanding why pupils in Scotland are a year behind those in England in mathematics. Such outcomes have long-term economic consequences.
Will the member take an intervention?
No, thank you. I am just getting started.
We might all wish that the process would involve addressing the drug deaths crisis, which is the worst in the developed world and is more than three times worse than it is in other parts of the UK, where the same drug laws apply. We might wish to deal with social care, national health service reform, online crime and much more. Those are the many issues that hang off the back of the fiscal choices that we make as a Parliament.
Instead, we must deal with the overarching fiscal malaise that was forewarned, in response to which the Government has yet to present a coherent answer. The assessment that the Institute for Fiscal Studies provided of the SNP’s spending plans during the election was absolutely brutal. The £1.4 billion increase in spending commitments, for which no credible funding has been identified, could increase the fiscal gap to some £6.1 billion.
Unfortunately, the big answers will not be found in the scope of the measures that the Government has identified in its motion. It has failed to quantify how much those measures would raise. By my calculations, the proposed mansion and jet taxes would account for up to about 0.33 per cent of the gap. I have rounded that figure up and, frankly, I have been rather generous in my assessment. I do not believe that the Government believes that those measures are commensurate with the scale of the challenge.
Mr Marra said that the fiscal gap is a consequence of the Government’s spending plans and that we have no plan for addressing it. I think that he is wrong on both counts. The fiscal gap is based on projections of past increases continuing into the future, and that is not necessarily Government policy. The Fraser of Allander Institute was clear in saying that the spending review that was published earlier this year laid out how the Government intends to close the fiscal gap over the five-year period.
I would certainly have to differ with Mr McKee on some of the analysis. The demand on our public services is recognised. It is clear from many reports by the Scottish Fiscal Commission that demand on public services and the requirements on them in meeting, for example, the cost of climate change will continue to rise, not just over the course of the current parliamentary session but in the future. Given that we have an ageing population, we know that health spending is projected to continue to grow. The issue is a result partly of the demand that exists, as well as of the policy choices that Mr McKee and his Government colleagues have taken.
The Government needs to adopt a far more serious approach. If appointing the axe-master general to the Cabinet is how the Government intends to address the remaining 99.7 per cent of the gap, that will be ruinous for our public services. Mr Rennie identified the need to set out the balance in relation to spending, taxation and, crucially, growth when it comes to tackling the key issues.
Had Scottish Labour prevailed in the election, we would have undertaken an urgent process to set all of that right. Instead, the SNP won a handsome victory in May, but it is incumbent on it to honestly appraise the budget in a manner that it has failed to do for years. In three years out of the past four, we have had an emergency budget. We cannot find ourselves in that situation again.
I welcome the cabinet secretary’s commitment to report back on the status of the tax advisory group that was advising her predecessor in the Government. We must get the right balance between the taxing of income and the taxing of wealth, because there is a trade-off and tax cannot always be viewed as additional, despite the broad challenges that we face. What consideration will the Scottish Government give to the behavioural effects of the taxation policies that we are talking about today? It is crucial that the Government and the Parliament get the right advice on that.
In the spirit of collective endeavour, because we all have to put our shoulders to the wheel and get on with it, the Labour amendment asks the Government to be true to its word today. I believe that it will do so, which is welcome. The First Minister has committed to looking at business rates and addressing what business leaders know to be a broken system. He met Sir Tom Hunter on 14 May and personally promised him reform. This week, the First Minister further pledged to act on the fresh start campaign that is being mounted by The Courier, The Press and Journal and The Sunday Post to introduce rates relief from day 1 for those who take over a vacant property. That measure is proposed to discourage properties being left empty and to encourage business growth on high streets in towns and cities, and I think that we all agree that we need action in those areas.
However, Labour believes that that must be seen in the round as part of a comprehensive review of business rates, so that we use them to encourage growth, not as a punitive measure. All of our inboxes are already beginning to groan with messages from people who are suffering as a result of rates revaluation. I sincerely hope that the Parliament as a whole can back Labour’s call to get that under way.
Scottish Labour also wants to see immediate action on council tax reform. If that is ever to be done, it surely has to happen now, at the start of this parliamentary session, given that political constraints always seem to present themselves later. I was elected in 2021 and, in my five years in the Parliament, I have become tired of obfuscation and excuses, of reports being commissioned and then shelved and of the dancing on the heads of pins with the language of consensus when what is required is good leadership and a solid majority in the Parliament. The Government must step up. If it does, we will be partners in trying to find a solution.
The SNP’s 20-year failure to reform council tax is a big part of why our local communities are shadows of their former selves, why our streets are so dirty, why young teachers are flying off to Australia to look for work for want of permanent contracts and why councils are wracked with conflict between workers who are being asked to deliver the impossible and managers who are being asked to pretend that the impossible has been achieved. Let us start this session with an openness to finding a solution.
It is on that basis that we lodged our amendment, and I hope that the whole Parliament will vote for it. I move amendment S7M-00249.4, to insert at end:
“; notes that the Scottish Government’s Medium Term Financial Strategy, published in June 2025, projected a funding gap of over £4.7 billion by 2029-30; considers that developing a sustainable plan to close this gap is essential to Scotland’s public services and that it is incumbent on all parties in the Parliament to work towards this goal; believes that, to this end, the Scottish Government should take a strategic approach across all devolved taxation in Scotland to include an immediate and comprehensive review of business rates, including consideration of measures such as widening the scope of Fresh Start relief to include businesses that occupy an empty unit within six months of the unit becoming vacant, and further believes that the Scottish Government should convene cross-party talks on council tax reform immediately.”
15:07
This is my first opportunity on the record to congratulate the new Deputy First Minister on her appointment. I am pleased that she has chosen to debate this topic so early in the session.
Greens have laid the case for wealth taxes. Both here and at UK level, it is Green voices that are most clearly advocating for change. We do that because we know that the richest 2 per cent have more wealth than half the population combined and because we believe that that is simply indefensible.
It is not only the Greens who believe that. Members will have seen briefings for today’s debate from a range of organisations. The Scottish Trades Union Congress tells us that the
“growth in wealth of Scotland’s ten richest people … has outstripped workers’ wages more than sixfold since”
this Parliament first met in 1999. Tax Justice Scotland, which includes Oxfam Scotland, the Poverty Alliance, the Health and Social Care Alliance Scotland and others, describes wealth taxation as
“one of the most promising opportunities for building a more prosperous and sustainable Scotland.”
We also know that 85 per cent of people in Scotland want taxes on the wealthy to increase. That figure includes a large majority of people who are, themselves, very wealthy, as the organisation Patriotic Millionaires has shown in its briefing.
Would Patrick Harvie concede the point that the very wealthy are also likely to be the most mobile and that they can therefore take their wealth and their assets out of Scotland?
If the member reads the briefing that I have just mentioned, he will see that the vast majority of millionaires who were canvassed by that organisation are more worried about doctors leaving the country than they are about millionaires leaving the country.
We need to face up to the fact that what poses as trickle-down economics is, in reality, hoover-up economics. It always was, and it has led to the hoarding of wealth by those who are least in need. If the SNP now agrees and accepts the case for a bigger role for wealth taxation, that is great, but we will need to hear some specifics—more than we see in the motion—and if cross-party talks are being offered, they will need to come with real political will to act.
To be clear, I note that I really welcome the progress that has been made—and I should, as a lot of it has been the result of pressure from the Greens. The private jet tax and the mansion tax are both positive steps that show that tax can be successfully targeted at those with the most and those who consume more than their share. I am also pleased that support is growing for the so-called Amazon tax: a tax that is targeted at some of the biggest and wealthiest companies doing business—the online retailers. The Greens support that, the SNP supports it and I understand that Labour supports it, too. Today’s Green amendment gives Parliament the chance to endorse it.
However, let us be clear that, welcome as those steps are, they have, on their own, been modest measures in both the scale of the revenues that they generate and their power to address the current maldistribution of wealth. Is there more that we could do if we had greater fiscal power? Of course there is, and Greens support that call. I am particularly pleased that Labour has lodged a positive and constructive amendment that does not seek to remove that possibility from the Government’s motion.
It is equally critical that we do not use that possibility of new powers as cover—as an excuse to delay action that we can take within existing powers. The single most significant element of wealth tax in Scotland is a broken system, and it is the single biggest example of failure in the history of devolution. This Parliament has achieved a lot and, as its authority has grown as the seat of Scotland’s self-government, its confidence as an institution has grown. However, the most glaring omission—and the challenge that has been ducked time and time again—is reform of the council tax.
The council tax was unfair even when it was introduced, but it has grown ever more regressive as property values have spiralled, and it is inadequate to meet local government’s needs. It now represents a small fraction of the revenue that our councils need, and it locks them into growing dependency on the national Government. Given that it is still based on 1991 valuations, it will be an astonishing 40 years out of date by the end of the current session of Parliament if we, collectively, do not act. That must not be allowed to happen.
A modern, progressive property tax would help cut inequality, let our councils invest in their services and help prevent even worse inflation in the cost of housing. I know that it is a political challenge—let us be in no doubt about that—but if the Scottish Government is remotely serious about the need for further steps on wealth taxation, it simply cannot continue to ignore the most important element of wealth tax that is within its control, which is the broken, inefficient and unfair council tax.
That is why I move amendment S7M-00249.1, to insert at end:
“; recognises that significant scope exists for further action within devolved powers, such as surcharges within the non-domestic rates system; further recognises that political support has grown for a so-called Amazon tax, as proposed in both the 2026 Scottish Green Party and Scottish National Party manifestos, and believes that progressive reform of property tax could play a powerful role in wealth taxation, and that the Scottish Government must not allow council tax valuations to reach the milestone of being 40 years out of date by the end of the current parliamentary session.”
15:13
I think that we all know why this debate is taking place: the SNP Government and John Swinney are in hock to the Scottish Green Party. A party that does not even believe in economic growth has influence, albeit now from outwith the Government, over the SNP Administration’s tax policy. However, the fact that the Greens are no longer in government does not mean that they cannot do real and lasting damage to the Scottish economy, Scottish workers and Scottish businesses, just as they did when they were in government.
Let me start with a few home truths—the basics that may be lost on some of the more wackadoodle MSPs elected to this Parliament in May. First, there is no such thing as exclusively public money. There is only taxpayers’ money, and the Government has a duty to spend it wisely. Secondly, the Government should have a very good reason to tax people’s income and wealth; it has no moral case and no justification to do so otherwise. Thirdly, taxing anything beyond a certain point can, and does, generate less. This Government saw that clearly in the previous session of Parliament.
I am grateful to the member for taking my intervention. Does he agree in principle that abolishing poverty is a legitimate reason to impose taxation on those who have more than their share?
Growing the economy is the legitimate way of eradicating poverty. If we grew the economy, we would not need the burgeoning benefits bill that the SNP has presided over for the past 14 years.
Mr Harvie might disagree, but I believe that there is a moral and social case for cutting tax. The Government does not see that and the Parliament has never tried it. I remind ministers of one simple fact: the Parliament has not just tax-raising but tax-varying powers. That is why the Scottish Conservatives proposed a fully costed set of tax cuts in the previous session of Parliament, and that is why we will continue to argue during this session of Parliament—as our amendment does—for a reduction in income tax to stimulate the much-needed growth that we all want to see, to fund Scotland’s public services.
The inescapable fact is that people in Scotland now pay over £1.8 billion more a year in tax than they would if they lived in the rest of the UK. Many believe that there is nothing credible to show for it. Those struggling to access healthcare, having to raid their own savings or their pension to pay for a new knee or a hip, or those who are damaging their cars by driving on roads that are riddled with potholes are, quite rightly, questioning what it is that they are receiving.
In an election during the cost of living crisis, we committed to cutting the biggest—
Will the member take an intervention?
I do not have time, I am afraid—or I will take it, if I can get the time back.
I agree on the need for fiscal competence, but all that we are hearing from those on that side of the chamber is about cuts. The member mentioned potholes. Does he recognise that some public expenditure—on transport infrastructure, for example—is vital for economic growth? Does he not recognise the need for fiscal responsibility and public expenditure to deliver growth in that sense?
Absolutely, but the best way to generate tax receipts is to keep people in employment. The member’s party fatally underestimated that when it increased the national insurance tax attached to jobs, which forced people who were contributing to the economy out of work and out of the labour market. Those people are now in receipt of benefits. What I am suggesting will unlock the money to improve roads in constituencies such as Dumfriesshire, as we all want to do.
To those who say that cutting tax is inherently bad, I say: let us think about that for a moment. There is no contradiction between being fiscally conservative and pro-business, and wanting better public services and being modern and compassionate.
I now want to address head-on the size of the deficit that the Government faces and to address its causes. Ministers face a £5 billion deficit by the end of the decade, but let us be clear: that is down to overspending, not a lack of tax receipts. I welcome ministers’ desire to cut the size of the state, but I question their ability to do that and their commitment to achieving it.
Notwithstanding the SNP’s pledge to deliver free school bags for all primary children and a culture payment for all 18-year-olds, the Deputy First Minister has her head in the sand when it comes to the biggest problem of all—cutting the SNP’s benefits bill. By the end of this decade, that bill will reach £10 billion, and I have heard nothing from the SNP, the Greens, Labour or Reform that signals a commitment to reducing it. We, on the other hand, have been crystal clear: we would reintroduce the two-child benefit cap, apply it to the Scottish child payment and significantly overhaul the adult disability payment to ensure that it fairly promotes work.
I will also address the issue of wealth taxes.
Will the member take an intervention?
I do not have time, I am afraid—I have taken two already.
You do have time, actually.
I will take the intervention if I get the time back, Deputy Presiding Officer.
Does the member recognise that the adult disability payment has to do with the additional costs of having a disability or a long-term condition? It does not have anything to do with whether or not someone is in work. Indeed, decreasing the payment takes away support that encourages people into work.
I fully understand that that was the central policy proposition when the benefit was introduced, but there has been significant growth in the number of young people with mental health conditions, so can the cabinet secretary explain what additional costs are being experienced, particularly with regard to those who are not working? The Government has conceded the point that it needs to review the way in which the benefit is operating—it has to, because it is totally unaffordable. That is why we have argued very strongly for that to happen.
To go back to the wealth tax, I have to ask this question: is the SNP, under the influence of the Greens, now so infected with the politics of envy that it effectively wants to shut down wealth? Talk of a private jet tax—
Will the member give way?
I will not. I think that I have been quite indulgent.
I ask members who are trying to make an intervention to press their request-to-speak buttons. A number of members have not been doing that. If they do so, it helps with the broadcast.
I do not believe that I have time to take an intervention.
As the Presiding Officer has made clear, we will add on time when a member takes an intervention.
If I have unlimited time, I say to the member: bring it on.
I ask the member, in all sincerity, what the Conservative position is with regard to wealth, ownership and matters of equality and distribution. There is a tradition within the Conservative Party, going back to Noel Skelton and Harold Macmillan, of thinking about these things deeply and seriously. Does the member recognise that profound wealth inequality in society creates not only social ills but profound economic ills?
Members can go back beyond Macmillan, to Disraeli and others, to find the principle of one-nation conservatism alive and well. The issue is how proportionately and effectively we tax the wealthy. I believe that, if we simply send a message out to globally wealthy individuals that Scotland is a hostile environment, fewer of them will come and more of them will leave. That is the fundamental reality that is lost on Patrick Harvie. We must guard against that.
The point that I made to Mr Harvie earlier is that some of the wealthiest Scots are also the most socially mobile. Take Alan Cumming, who lives in his $5 million Manhattan townhouse, or Brian Cox, who divides his time between the UK and the United States. When Brian Cox comes to Britain, he chooses Primrose Hill in London, where he avoids the Scottish National Party’s high taxes. Although Mr Cox is happy to fly north to Scotland—I am not sure whether he does so on a private jet, Mr Harvie—he does not want to live here. He has explained:
“I find Dundee difficult … the poverty is very hard to take. To see the heroin addiction, to see where it’s got to”.
It is strange that that did not make it into an SNP party election broadcast.
I want to turn now to the motion and amendments before us. On the Labour amendment, I agree on the need to examine business rates, but I remind members that, during the previous session of Parliament, budgets that the Labour Party did not oppose repeatedly short-changed Scottish businesses on rates relief.
As for Reform’s amendment, I note the reference to the Institute for Fiscal Studies, and I must commend Reform for SNP levels of selective quotation. Was it not the IFS that described Reform’s self-funding tax cuts as “a mirage” and “not credible”?
The Greens’ amendment sums up, perhaps, the timbre of the debate. To it, I pose one question: when there is little or no wealth left in Scotland to tax, and when the wealthy have gone and the tax base shrinks, how on earth will we fund the public services that our country needs and deserves?
That is why the Conservatives will vote against the motion, and it is why we will steadfastly oppose any further tax increases or any attempt to further devolve tax powers to this Parliament. Fair tax, low tax and a growing tax base should be the watchwords of this Parliament in this session.
I move amendment S7M-00249.3, to leave out from “, progressive” to end and insert:
“and low taxation, which incentivises work and investment; rejects the left-wing ‘Holyrood’ consensus, which believes that Scotland can tax its way to economic growth; calls on the Scottish Government to use its existing devolved taxation powers to reduce income tax to stimulate growth, and rules out any further devolution of fiscal powers, which have already created a damaging tax differential, which undermines Scotland's ability to retain and attract high earners and wealth creators.”
15:23
When I intervened on the cabinet secretary to ask her about the balance of her speech, the next sentence from her was about another tax. She may say that I should take the whole speech in its context—she did talk about other things—but the message that was clearly sent out was about a traditional tax-and-spend approach and policy. The trouble with that is that we need to have trust in taxation.
We saw what happened when Humza Yousaf was First Minister. He lost control of the narrative and the rhetoric, and it sounded as though he was going to increase taxes for ever. He got very excited about the prospect of which taxes he could increase. Pretty immediately after that, there were severe attempts by the Government to bring the budgets back into control in year. For two years in a row, in fact, emergency cuts had to be introduced to the Scottish Government’s spending proposals.
I say all of that because it knocked public confidence, and, when we lose confidence and trust in taxation and the Government, we get behavioural change. Sometimes it is not the policy at the time that causes that change but the prospect of what the policy might be in two or three years’ time. When people who are mobile make decisions about where they are going to take a job, they do so with a view to the future and where they think the Government is going. We are not talking about millionaires here; Patrick Harvie talked about doctors and consultants, and we have a significant problem in Scotland with the recruitment of consultants.
I am enjoying Mr Rennie’s analysis of where we are. He raises the issue of the looming £5 billion black hole. The Deputy First Minister seemed to suggest that taxes were not going to rise to fill that. Mr McKee is on record as saying that public sector reform does not mean reducing overall public spending. Is Mr Rennie any clearer than I am as to how that £5 million black hole is therefore to be filled?
I am a generous man and I have full confidence in the front bench to sort out that puzzle and conundrum. It will require resolution, because it is looming fast. The £5 billion—the Deputy First Minister could not quite bring herself to say that—is a huge amount and the issue will require resolution quickly, because such savings take a long time to implement. We cannot just pull a lever and have things happen—things take a long time to happen.
I am confident that Jenny Gilruth and Ivan McKee will introduce the changes that are required, and I think that the First Minister has set them that task, but I am not sure that I have heard that today.
I wonder whether I could bring Mr Rennie back to the argument that he was making about trust in the tax system. He seems to place most of the problem around devolved approaches to progressive tax. Is it not at least as plausible that the reason why people lack trust in the tax system is the tax dodging and tax avoidance by the super-rich and by big business? Is that where we should start taking action to restore trust and revenue?
I believe that that is part of the problem, and we should not kid ourselves that it is all just one equation. I accept that and I encourage firmer and faster measures, but we are in this Parliament, where we need to make decisions about our finances. We need to be focused rather than deflecting on to other Parliaments and other issues.
Public service reform will require to be substantial, and we will need to engage in new methods of reform. I will work in partnership with Ivan McKee and Jenny Gilruth to make that happen and reach agreement, if we possibly can, because I accept that change is hard. Today, I met an organisation that promotes social impact bonds. I know that that area was in the Scottish National Party’s manifesto—it was in ours, too—to incentivise investment from private sources in order to secure a return for substantial change. We know that, when a fire is going on in public services, it is difficult to implement change at the same time, because of the people and money that are available, so I am in favour of such measures.
I am in favour of tax reform and, on the face of it, I agree with everything that is in the Green amendment. Council tax reform is long overdue. I would favour moving from taxation of physical assets through business rates to online taxes for Amazon and other such companies. My problem with that is the rhetoric, which sounds too enthusiastic about increasing taxation.
We should have reform, and we should work on the basis that it is revenue neutral as a starting point, before we even consider whether it should result in increased revenue in the future. It sounds as if I am being boring, but a bit of boringness in politics does no harm, because it brings predictability and confidence. The Government and parties sometimes reach for easy solutions, but sometimes the easier and more glitzy something sounds, the more unbelievable it is.
Let us focus on actually making the change. Let us build confidence among taxpayers. Let us grow the economy. Let us make sure that we have more participation in society and the economy, so that more people contribute to taxation—that way, I will get excited. That is the change that we need, and I urge members to vote for our amendment.
I move, as an amendment to motion S7M-00249, to leave out from “welcomes” to end and insert:
“notes that fair taxation must recognise the current cost of living crisis and the impact that any tax increases can have on individuals and businesses; believes that the Scottish Government must prioritise getting Scotland’s finances in order, in light of warnings by the Institute of Fiscal Studies that it faces a ‘fiscal reckoning’; considers that taxpayers in Scotland deserve value for money as well as confidence that their taxes are being spent wisely, and believes that the trust that taxpayers should have in a government to spend wisely has been lost over the last 19 years of an SNP administration.”
We move to the open debate. I remind members that there should be no interruptions during a first speech.
I call Katie Hagmann to make a first speech.
15:29
I am thrilled, humbled and, if I am honest, mildly terrified to be giving my first speech in our Scottish Parliament. First, I congratulate the Deputy Presiding Officer on her new role, as well as Jenny Gilruth on her role as Cabinet Secretary for Finance and Local Government and Deputy First Minister. I thank the people of Carrick, Cumnock and Doon Valley for placing their trust in me.
What an enormous privilege it is to be trusted to serve. The First Minister has spoken of the responsibility of public service, and that responsibility requires vision, bravery, compassion and integrity. That deep sense of duty sits with me each and every day. It is what drives me and it is what I will put into practice as the MSP for the constituency. What a constituency it is: from Culzean castle on the Ayrshire coast, gazing out to the iconic silhouette of Ailsa Craig and across to Turnberry, which is the birthplace of Robert the Bruce, to, in the north, Mauchline and Scotland’s national monument to Robert Burns, before moving through the proud industrial heritage of Cumnock and to the stunning beauty of Loch Doon in the heart of the Galloway forest park. I am continually inspired by the history, culture, natural beauty and, above all, the people and the communities that define Carrick, Cumnock and the Doon Valley.
I am stepping into the role and picking up the baton from two incredible women in Scottish politics. My predecessor, Elena Whitham, devoted herself to public service, having worked in Scottish Women’s Aid, across local government and as an MSP and minister. Elena led with tenacity, intellect, kindness and compassion. I send her my best wishes for the next chapter in her life and thank her for her service.
Carrick, Cumnock and Doon Valley was also the constituency of the formidable late Jeane Freeman. Jeane led on the creation of Social Security Scotland, enshrining her own values of dignity, fairness and respect in Scotland’s legislation. As Cabinet Secretary for Health and Sport, Jeane steered us through the worst of the Covid pandemic with those values. She co-founded Women for Independence, ensuring that women’s voices were brought into the independence debate. She was a giant of a woman, and I will forever be guided and inspired by her lifelong commitment to public service, social justice and fairness.
That sense of fairness is, I believe, central to the debate. Nestled in the heart of my constituency lies the small village of Dailly, which is the birthplace of the Rev John Thomson, the 19th century minister whose name has forever been associated with the well-known Scottish phrase “We’re aw Jock Tamson’s bairns”. That phrase speaks to something fundamental about Scotland and the progressive values that we hold dear. No matter our background or where we come from, we are all equal in worth and we are all deserving of dignity. Governments must match progressive values by making progressive choices. Wealth taxation for public services is one of those choices.
I come to the debate in a unique position. For the past nine years, I have served as a councillor in local government, including time as the Convention of Scottish Local Authorities resources spokesperson. I fought for front-line services and worked cross-party. I gave evidence to committees in the Parliament, and I often shared the stark financial reality that some local authorities are facing.
When I gave evidence to MSPs, one question that I was often asked was, “Where is the extra money to come from?” It was a fair and necessary question. I welcome the record-high funding for local government. However, after years of Westminster austerity, and due to the constraints of devolution, the Scottish Government and local government face immensely challenging fiscal realities. It is imperative that we are bold and brave and explore progressive wealth taxation. By asking those with the broadest shoulders to pay a little bit more, we can deliver stronger services and help the less well-off to not only survive but thrive.
For the first time in my life, I am in the higher tax bracket, and I am quite comfortable about that. My son benefits from free university tuition. Almost a year to the date, I was sitting with my terrified mum in surgery school, preparing for her life-saving cancer treatment in our incredible NHS. Thanks to the cancer treatment pathways that are available, she is able to watch me online giving this speech today.
I passionately believe in fair, progressive and sustainable taxation to support the delivery of our public services. I welcome the progress that has been made towards a private jet tax and a mansion tax, particularly given that the mansion tax funds will go directly towards local areas. However, as is set out in the Scottish Government’s motion, we must recognise that Scotland’s current powers are limited. I welcome further steps to explore how we can go further, whether in the current devolution settlement or with the full fiscal powers of Scottish independence.
The debate is not ultimately about tax; it is about dignity, fairness, respect and the country that we know that Scotland can become. If we truly believe that we are all Jock Tamson’s bairns, we must also believe that prosperity should be shared, that opportunity should be available to all and that those who have benefited from our society should contribute fairly to sustaining it for us all.
15:37
In this world,
“nothing can be said to be certain except death and taxes.”
We, at Reform Scotland, do not disagree with Benjamin Franklin’s premise, but we certainly believe that we have a duty to minimise the impact of both for as long as possible.
It is the progressive left that loves taxes, just as it loves net zero, diversity, equity and inclusion, immigration and welfare. I salute Pat McFadden for his honesty when he said that Labour MPs are only really interested in finding new ways to raise taxes to pay out more in benefits. I am afraid to state the bleeding obvious, but the SNP shares that doctrine on steroids. Sure enough, three weeks into the new parliamentary session, it is already rolling the pitch to introduce new taxes on private jets and big houses—how predictable.
Yet, some progressive voices are pushing back on all that dogma. How ironic that it is the founding members of the new Labour project, the Blairites—the very champions of the progressive new society—who are the forerunners now pushing back. Tony Blair has written his 4,000-word essay. His central message is that, if we want a fairer society, we need to create jobs and wealth and not only provide welfare. His first clarion call is to abandon net zero and drill, Mili, drill, because no country can build prosperity for its citizens without access to affordable energy.
Meanwhile, this week, former Home Secretary Jack Straw has come out to challenge DEI policies and the police, saying that the anti-racism guidelines have gone “too far”. That is no wonder after the country reacted in horror to the iniquity of the two-tier policing that we saw in Southampton this week.
However, for me, the most significant contribution has come from Alan Milburn, the former health secretary, who stated that too much welfare is actually destroying lives. Wow. How right he is that the welfare state, which was set up to be a safety net, has now become a lifestyle choice. It is damaging the life prospects of our less productive citizens, especially our young people. Let me again state the bleeding obvious: work should always pay more than welfare, and the best form of welfare is a good job.
Will the member take an intervention?
No. I am going to crack on for now.
In Scotland, we have 750,000 people of working age who are not in meaningful employment, and that figure is forecast to increase to 1 million in the next decade. That is out of a population of 5.5 million. Meanwhile, we are short of nurses, care workers, welders and chefs; yet, in her first speech in this chamber yesterday, the new minister Alison Thewliss declared, in a halo of self-righteousness, that those jobs could be done only by immigrants. Is Alison Thewliss really ready to write off the talent and ambition of our own workers so easily?
Will the member take an intervention?
No. I am going to keep going with this.
Our very own people—
Will the member take an intervention?
I will take the intervention.
If the member checks the Official Report, he will see that I said no such thing. However, we should not be sending away people who are here to help.
We need to look after our own people and help them back to work. We have 750,000 Scots who are not working, and we need them back in our communities. I salute the new Green member Cara McKee, who spoke eloquently about the need for care workers in our community. She talked about the need to train them more and pay them more. Why can we not start with our own amazing home-grown Scots and create a new, proud care-in-the-community profession? Do the Greens think that our people are not caring or capable enough? I do not understand. Their solution is to tax the rich, send our workers home on benefits and then bring in immigrants to do the jobs that Scots apparently do not want to do themselves, which I find quite bizarre.
I will take that intervention from Craig Hoy now.
Can Malcolm Offord clarify where Reform Scotland stands on benefits? We have been very clear on the two-child benefit cap—we would restore it and apply it to the Scottish child payment. What is Reform’s policy on that?
I assure Craig Hoy that we believe that the best form of welfare is a job, and we believe that we need to deal with the welfare bill, which is spiralling out of control. We need to get our own people back to work, and we need to give a lot of care and attention to our own people who are struggling and need pathways back to work. So far, in the three weeks of this session of Parliament, I have not heard any solutions or proposals put forward to help our people back to work.
Let me finish with the idea that the solution is always to tax the rich, which is perfectly laudable and understandable. The top 1 per cent of earners currently pay 30 per cent of income tax, and the top 10 per cent pay 50 per cent. That is only a quarter of a million Scots. They are already willingly standing their round at the bar, but, if we tax them too much, they will leave. In Europe, wealth taxes have been abandoned in Germany, Sweden and France, because they do not collect what they are meant to collect. I thought that the whole point of being Scottish was to lead the world, not just to follow failed experiments elsewhere.
I go back to my second question to the First Minister today. Do we simply not understand that, if we raise taxes, we collect less money but that, if we cut taxes, we collect more money? Is not the objective to raise more revenue? Between 2000 and 2017, Sweden cut its tax ratio from 51 per cent to 44 per cent of gross domestic product, and it collected an additional £20 billion per annum. The experiment has been done.
As I said in my maiden speech, it was the Scots who invented modern economics 250 years ago.
Will the member take an intervention?
No. I am finishing.
Let us re-embrace Adam Smith from Kirkcaldy. His approach was simple. He said:
“little else is requisite to carry a state to the highest degree of opulence … but peace, easy taxes, and a tolerable administration of justice”.
I call Martyn Day to make his first speech.
15:44
It is an honour to make my first speech in our national Parliament as the member for Falkirk East and Linlithgow. I thank the people of my home constituency for placing their trust in me. I do not take that lightly, and I promise that, however people may have voted, I will work tirelessly as their representative.
It is a community with industrial and historical heritage, stretching from Blackness to South Alloa and from Grangemouth to Limerigg. We sit, quite literally, between a rock and a hard place—between Edinburgh and Glasgow. At times, it can feel that way politically, too, and nowhere more so than in Grangemouth. For generations, the refinery and wider industrial complex have provided skilled jobs and have supported local families. The uncertainty surrounding its future has caused understandable concern. The transition to net zero must be a just transition. The skills and industrial expertise are national assets and the community must share in the opportunities that come with change.
When we discuss wealth in Scotland, we should remember that it is created not only in the boardrooms and financial markets but by the hard work of people in places such as Grangemouth. The men and women who have worked in Grangemouth over generations have helped to create considerable wealth for Scotland. It is only right that communities that create that wealth should share fairly in the opportunities and the public services that flow from it. That brings me to today’s debate. For many in my constituency, the question is one of fairness—whether wealth is being taxed fairly and whether we have the resources to support the public services that we all depend on.
Every constituency member will tell you that they have big boots to fill. In my case, there are multiple boots, belonging to Fiona Hyslop, Michael Matheson and Michelle Thomson, who, between them, had more than six decades of parliamentary service and experience. Fiona and Michael were members of the Parliament’s founding generation, elected in 1999, and they helped to shape the institution that we serve in today. I place on record my appreciation for their work and their friendship and for the support and advice that they have given me over the years.
My former Westminster constituency overlapped with the constituencies of Fiona Hyslop and Michelle Thomson, and we worked well together until the public decided that I should spend more time with my family. I am still trying to work out what it says about me that my family were so overjoyed when the public decided that they wanted me back.
One of Michelle’s jokes is that, when you join the national movement, no one tells you that the first 20 years are the worst. After almost 40 years of campaigning for independence, I have seen both the highs and the lows, such as being swept into Westminster in 2015 as part of the SNP landslide and then watching Scotland repeatedly return mandates for a referendum only to be told, “No”. Whatever view members take on the constitution, the denial of democracy is not a healthy position for our nation.
Deputy Presiding Officer, if you will indulge me with one final tribute, I will mention the Presiding Officer’s predecessor, George Reid, who passed away during the election campaign. He represented parts of my constituency in the 1970s and was fondly remembered by many people whom I met on the doorsteps. I have my own George Reid story. Before this Parliament was reconvened, he became the only passenger I have ever driven who grabbed the steering wheel—because he thought that I was about to drive into the Avon gorge on a stormy night. He never took another lift from me.
The Cabinet Secretary for Economy, Tourism and Transport can expect to hear from me about this matter—the gorge, not my driving. The A801 Avon gorge has been talked about for so long that Manny Shinwell raised it when he was MP for Linlithgowshire. More than a century later, communities in the Braes and in West Lothian are still waiting. The Scottish Government’s infrastructure investment plan recognises its importance, but years of delay have left local people wondering whether they will ever see a shovel in the ground. Getting the Avon gorge crossing back on track will be one of my priorities in the Parliament.
Of course, everything needs to be paid for, and I believe that those with the broadest shoulders should pay their fair share. That means looking not only at income from work but at wealth and assets. The difficulty is that many of the important taxes on wealth, including inheritance tax and capital gains tax, remain reserved to Westminster, leaving the Parliament without the tools that it needs.
Had inheritance tax been devolved, Scotland would have been spared the uncertainty that was created by Labour’s proposals for family farms. Farming families in my constituency and across Scotland face the prospect of selling land that has been built up over generations simply to meet tax liabilities. Although Labour eventually changed course, months of anxiety had already been inflicted on our rural communities. That is a reminder that the decisions that affect Scotland are best made by those who are accountable to the people who live and work here.
Every day in my constituency I meet people who are worried about paying bills, affording childcare or getting on to the housing ladder. At the same time, wealth has become increasingly concentrated. The stark reality is that wealth often generates more wealth. People with substantial assets can save more, invest more and benefit from the opportunities that are simply unavailable to many working families. Over time, that gap widens. If we are serious about tackling inequality, we cannot ignore that fact.
That is why I support measures that ask the people with the broadest shoulders to make a fair contribution. Public services should be funded through a tax system that asks more of those who are best able to contribute. Ultimately, wealth taxation is about fairness. It is about ensuring that opportunity is shared more fairly and that public services are properly funded. That is the principle that lies behind the debate, and I am proud to support it.
I call Joe Fagan, who is making their first speech.
15:51
I congratulate the Presiding Officers on their election and the new front-bench members on their appointment.
My entry in the register of members’ interests will show that I am a councillor with South Lanarkshire Council. To be elected to the Parliament is a special privilege and I am immensely grateful to all the people who voted across the vast and varied region of South Scotland, from coast to coast, through market towns and mining villages, to my home in East Kilbride. Until last week, I was the leader of South Lanarkshire Council, and, as someone who led a public service speaking in a debate that is about tax for public services, I say that public services are nothing without public servants. I have been fortunate to work with some of the best in the country.
I am not the first South Lanarkshire Council leader to be elected to the Parliament. I share that privilege with the late Tom McCabe, the first ever MSP elected in 1999. Then, as now, South Lanarkshire was at the forefront of public service reform. The council was a pioneer in community planning. Today, it is working with Public Health Scotland as one of three Marmot place pilots, addressing the social determinants of ill health with the support of the Institute of Health Equity and the inspiring Professor Michael Marmot.
That work tells us that it is not only demographic change that drives the service demand but disadvantage, health inequalities and vulnerabilities in our society that we have collectively failed to prevent. That was the Christie commission’s central message 15 years ago. It said that there had to be a system-wide shift towards preventative spending—a shift from addressing the consequences of inequality to tackling its causes. The failure to implement a progressive reform agenda over a sustained period is the underlying reason why the Scottish Government faces such a wide fiscal gap. There is too much reactive spending because there was too little investment in prevention.
In 2008, a ministerial task force committed the Government to narrowing the gap in healthy life expectancy between the most deprived and least deprived people. However, the gap has not reduced—it has grown. Eighteen years ago, the Government set out to reduce the prison population, but today it is at a record high. The Government promised to eliminate delayed discharge from the NHS but, last year, people spent more than 720,000 clinically unnecessary days in hospital at a cost of £440 million. Record high numbers of people are housed in temporary accommodation while social housing starts have fallen to record lows and local government—the sphere of government that is best able to scale prevention—has lost more than £7 billion in core funding in real terms.
We are stuck in a cycle that does not work. Whatever the merits of the Government’s motion, it does not point to a tax and spend framework that breaks the cycle. Social investment, funded fairly and realistically, is essential if a Scottish model of public service reform is to be viable.
Candidly, that is the story of Scotland post-Christie—progressive intent, regressive reality—and, too often, that is the story of the Scottish Parliament, too. The architects of devolution—the noble leaders who came before us—imagined a Parliament that would elevate public life: a new politics of public service, social justice and democratic renewal. I believe that, too often, Parliament falls short of the ideals that shaped it and mirrors what it was defined against. Too often, it has been conceited and trivial when it must be rigorous and self-aware.
I welcome the steps taken by the new Presiding Officer to shake up proceedings and his tantalising promise of “devilment” in the session to come, but making this institution better serve the people who elect us is a responsibility for all of us who are elected. At this juncture—the start of this new session, with more newly elected members of the Parliament than at any time since devolution—I challenge all of us to think of what we can achieve together if we choose to elevate our politics now, if we liberate our public services from the burdens of inequality, if we are persistent in connecting progressive intent with progressive outcomes and if we recapture the spirit of new politics and put the Scottish Parliament back to work for the people of Scotland.
15:56
I commend Joe Fagan on his first speech. I may not agree with all of his politics, but I agree with his passion and intent, so I commend him for an excellent first speech.
It is clear that the different decisions on income taxation levels that were made in Scotland, whereby those who earn a little bit more are asked to pay a bit more, have contributed to securing additional revenues for various desirable outcomes that I would hope most of us in Parliament would wish to see. The Scottish Fiscal Commission estimates that the SNP Government’s income tax decisions since devolution will raise up to an additional £1.8 billion in the tax year 2026-27 compared to the position had the Scottish Government mirrored UK policy.
Scotland’s more progressive income tax system has supported a position in which the average pay for public sector workers in Scotland is notably higher than it is in the UK as a whole. Our NHS, where we have invested strongly in the pay of our healthcare professionals, is a very good example of that. Our tax system has also contributed to funding Scotland’s strong childcare offer, which has resulted in families across Scotland benefiting from the provision of more than 1,140 hours of high-quality early learning and childcare since 2021, which is worth around £6,000 per child each year. It has also contributed to the almost £0.5 billion that the Scottish Government has invested in our Scottish child payment, helping to keep 100,000 children out of poverty here. It is also worth noting that most people in Scotland pay less tax than their counterparts elsewhere in the UK.
There has always been a political kickabout over the expression “free” when it is used to describe the delivery of Scottish Government policies—free school meals, free tuition, free prescriptions, free bus passes and so on. No one pretends that any of that is free.
However, let me set political decisions in context. The Scottish taxpayer has to pick up its share of the tab for spending decisions that are reserved to the UK Government. Examples of that include the £3 billion annual running costs of Trident, the £41 billion cost for the new Dreadnought-class submarines to replace the current fleet, and another £15 billion for replacement warheads—and those are all decisions that have been taken by the UK Government in the current Parliament. I would much rather see our Scottish Government invest in our social protections here, in Scotland, than in the illusory protection allegedly offered by nuclear warheads. There is another way, and it is the Scottish way.
The Scottish Government’s motion supports
“fair, progressive and sustainable taxation to support the delivery of public services.”
It reiterates the SNP position on
“the creation of a private jet tax and a mansion tax”.
I can say to Lord Offord that those policies are not curveballs—they were in the SNP manifesto.
With regard to the jet tax, I welcome the submission that we received from Oxfam Scotland, which strongly supports the introduction of an air departure tax with a higher rate for those choosing to travel by high-polluting private jets. Its analysis showed that,
“in just the first 10 months of last year, more than 10,500 … jet flights took off or landed at Scottish airports”.
This Parliament used to speak often about the polluter-pays principle. Money secured from the new tax could help to support our public bus network, for instance. I acknowledge the good work of the Strathclyde Partnership for Transport in taking forward a bus franchising model, which will not be cost free—it will require revenue support.
Bob Doris seems to be implying that the destination of the new taxes that are being proposed would go into an expansion of public services or at least entitlements. Does he not consider that any of that money should go towards reducing the £5 billion deficit that is coming down the track?
The medium-term financial review that Mr McKee has the invidious task of implementing through public service reform has been clearly set out, but every additional penny that is raised here, in Scotland, can help to bolster the social protection dispense that we all want. Bus franchising support could be part of that, as far as I am concerned, but I appreciate the point that Mr Rennie seeks to make.
A substantive part of the motion is on a mansion tax, which is due to be brought forward in 2028. Those proposals will add two additional council tax bands to be applied to properties valued at more than £1 million, with all the funds raised going directly to local areas to support public service delivery. Before Mr Rennie intervenes again, which he might wish to do, I note that those funds will depend very much on how many properties are worth more than £1 million in each local area. It is the revenue grant from the Scottish Government that provides the vast majority of local authorities’ income—I get that. However, in the round, I would say to Mr Rennie and other members in the chamber that additional moneys would be welcome.
I very much support the proposed mansion tax, but it will require careful scrutiny and implementation. It will involve a targeted revaluation, and it will be interesting to see how much each local authority will ultimately benefit.
The new council tax bands on properties worth more than £1 million should not get in the way of work—across parties and across the Government—that needs to be done regarding the council tax more generally. I welcome the reassurances that the Deputy First Minister has given this afternoon in relation to that.
Perhaps the most pertinent part of the Scottish Government’s motion is the part that recognises that
“Scotland’s current powers limit the scope of additional wealth taxation”,
with a call for us to
“explore what further steps could be taken either within the current system or with full fiscal powers.”
In another excellent first speech, Martyn Day spoke about inheritance and capital gains taxes. There is also income tax on savings and shared dividends and a whole variety of other taxes—there is a basket of taxes that we could consider.
I am not suggesting that we should tax the rich; that is not my demand or what I am calling for. We must go back to the underlying principles of the SNP motion, that our tax system should be “fair, progressive and sustainable”, and it all has to be balanced.
I am not calling for us to tax the rich; I am calling for a fair taxation system in the round. We must surely be able to do more on that. As the STUC reminded us in its briefing for today’s debate,
“Five families hold more wealth than a quarter of Scotland’s population with the least wealth combined. The wealth of Scotland’s ten richest people is now more than £23 billion, nine times what it was in 1999. This exceeds the Scottish Government’s projected Income Tax revenues for 2026/27”.
As I have said, I do not want to tax the rich; I simply want a fair taxation system and an underlying social contract with the Scottish people that underlines our commitment to social justice.
I call Iris Duane to make their first speech.
16:03
Thank you, Deputy Presiding Officer. I take this opportunity to congratulate you and welcome you to your post. I also congratulate the cabinet secretary on her appointment. I look forward to working with her across the next five years.
This is my first speech, and I must admit that I agree with my SNP colleague Katie Hagmann that the prospect of making it has been terrifying. However, it is also an honour to stand here, as one of Glasgow’s newest regional MSPs, after running what was an incredibly positive and hopeful election campaign. In Glasgow, hope beat hate and progress beat stagnation. I am proud that hundreds of activists from a variety of backgrounds came together and joined me to knock on thousands of doors. However, the real work begins here. I look forward to serving my constituents and fighting for them in the greatest city on earth over the next five years.
There are some new things that I bring to the chamber. As the youngest member of the Parliament, I must admit that I was slightly shocked to find out that the First Minister had already taken his first crack at leading the SNP before I had taken my first crack at breathing—I am sure that he will love finding that out. It is crucial that this Parliament reflects the whole of the country that it seeks to represent. Although I am the youngest in the chamber, I am absolutely honoured to bring my experience to all the debates in this place. Our world is changing rapidly and it has never been so important that our politics catches up with it.
I will turn to the substance of the debate. Colleagues, we are presented with a fiscal black hole and crumbling public services. Over the next five years, the 128 people who sit in this chamber will make choices that decide the fates of millions of people across our country. Our constituents look to us not to point our fingers at one another but to make decisions that will help them. If we fail to deal with issues adequately, it will only lead to further problems.
Recently, we have seen what that looks like. We all remember the sandcastle majority led by Keir Starmer, which, with promises of change, swept its way into number 10 on the lowest vote share in history to form a majority Government. Two years later, it has failed to adequately challenge the systems that are holding down our constituents, which has made it one of the most unpopular Governments in history. Its tendency to finger point and scapegoat has led to the re-emergence of the very hatred on our streets, in the form of the National Front and the British National Party, that we thought we had defeated.
We cannot allow our communities to shoulder the burden of our failures. This Parliament cannot be an austerity Parliament. It was not disabled people who caused the current length of NHS waiting lists. It was not those seeking support for surviving gender-based violence who caused the shortage in social housing. It was not those who receive benefits who caused our fiscal black hole. Yet we find our counterparts down south ripping support from all those groups, and some of them are seriously suggesting that they must go further to help fund more of Donald Trump’s disastrous wars. Is that what this Parliament wants to be?
The STUC estimates that a wealth tax of 2 per cent on the 10 wealthiest people in Scotland alone could raise around £500 million a year. Imagine what we could do together if we were ambitious for Scotland.
Colleagues, I speak of this matter with so much passion and urgency because of my own personal experiences. As someone who grew up in a single-parent household with a young working-class mum, I understand what such cuts could mean for so many people across our country. I am not ashamed of my upbringing, and I am not ashamed to have relied on free school meals or to know that my experiences growing up were markedly different from those of the majority of members in the chamber. However, I am afraid that, for many children like me, this Parliament will fail to deliver the necessary support for them to survive and thrive. Although I may now be in the immensely privileged position of standing here, I refuse to leave anybody behind.
At the thousands of doors that I knocked on during the election campaign, nobody asked for cuts, nobody wanted to see a reduction in service and nobody believed that we must shrink our state. In fact, so many people wanted to see us go further and faster. Across our country, we have countless teachers without permanent contracts; local councillors passing on the centralised cuts that we do not address here; a lack of good housing; a rise in homelessness; and an NHS that, admittedly, is doing better than it is down south but is still not being given sufficient support to thrive.
I do not believe that this Parliament should use the politics of envy to address the problems that we face. Debates of this kind will always focus on making difficult choices. However, it is always those who give up who tend to have the least. Let us not do that. We have five years in which to address the problems that our state is failing to solve and to help those in all our communities.
As my final assertion, I make one ask and plea: let us be a Parliament that is truly ambitious for Scotland, let us tax the wealth that we have and let us make our country work for everybody who lives here.
16:09
In Scotland, our values are clear: they are about fairness, solidarity and opportunity for all. As an SNP MSP, I champion taking a progressive approach to funding the high-quality public services that define our nation.
Why do we need to do that? We are facing rising demands on our NHS, our education system and our local communities, therefore we must have the courage to tax wealth more so that we can invest in the people of Scotland. After 15 years of Westminster austerity, our public services are under pressure. We also have an ageing population, and growing demand means that we cannot stand still. Waiting times, recruitment challenges and sustainability issues persist despite there being growth in real terms. Schools and local government also face strains.
Efficiency reforms and prevention are vital but, on their own, they are not enough. We need to generate sustainable, progressive revenue to match our ambition for a fairer Scotland. That revenue should come from increased economic growth and fair wealth taxation.
Wealth inequality in Scotland remains stark. The wealthiest 10 per cent hold a hugely disproportionate share—the top 2 per cent hold more wealth than the bottom 50 per cent. Much of that wealth grows through assets that benefit from Scotland’s stability, infrastructure and skilled workforce, all of which are supported by public investment. It is only right that those with the broadest shoulders should contribute more, to sustain the social contract.
The SNP will always act progressively on taxation. We delivered the most progressive income tax system in the UK, which protects lower and middle-income earners while raising substantial revenue for services, and, as we have heard, we are proposing a mansion tax on properties worth more than £1 million and a tax on private jet use.
I was heartened to hear the cabinet secretary talk about the need for long-term reform of council tax and business rates. Council tax reform is needed in this session, and we must all work together to ensure that that happens. We have had too many debates on the subject for it not to happen. The need for council tax reform goes to the heart of not only progressive taxation but local accountability. Business rates also need to be reviewed if we are to support and grow our business base.
However, we must go further by seriously exploring and developing wealth taxation options. More funding needs to be found to support more nurses, teachers and care workers, to expand programmes for tackling child poverty and to invest in the green jobs and infrastructure that grow our economy. The broader debate is about ensuring that the successful pay their fair share—
Will the member take an intervention?
Yes.
Mr McLennan will be well aware that there are many different ways of generating economic growth. Torness power station in his East Lothian constituency has generated significant economic growth. Since it came on stream, it has contributed £17 billion in gross value added to the economy. Therefore, does he regret his party’s decision to close down nuclear energy in Scotland, which has been a huge contributor to the Scottish economy?
I will touch on that. I mentioned the need for investment in the green jobs and infrastructure that grow our economy. Just last week, the Confederation of British Industry published a report that highlighted the green jobs opportunities that exist in East Lothian, which is the third-biggest contributor in Scotland to the green economy. Renewables are the future, both in Scotland and in East Lothian.
The broader debate is about ensuring that those who are successful pay their fair share towards the foundations that make success possible. Polling shows strong public support, including among higher earners, for taxing extreme wealth over cutting services. We can build on the property and land taxes that we already control to develop a targeted, nuanced taxation system—there are many international examples out there that we can learn from—that will minimise avoidance while delivering results. Relying solely on income tax hits working people harder. In Scotland, we have shown that we can use fiscal powers progressively without harming growth.
However, we must revisit the current fiscal framework with the UK Government, which does not suit Scotland. There is a total lack of flexibility.
When it comes to what Paul McLennan would like to spend the extra money on, his list is different from the one that Bob Doris gave. Does the SNP have a coherent position on that?
I go back to my point that the broader debate is about ensuring that those who are successful pay their fair share towards the foundations that make that success possible. There is a balance to be struck here, which involves looking at fairer taxation, what we want to spend the money on and the fiscal framework within which we currently operate. I will touch on that later.
There is no disagreement on what we want to spend the money on. I have highlighted the need for investment in child services and other services to ensure that the values that I have mentioned are promoted.
We need to have a targeted and nuanced taxation system, because relying solely on income tax hits working people harder. We also need to revisit the current fiscal framework, which, as I said, does not suit Scotland.
Today’s debate is not only about taxation. There will be many debates about growth, as there should be. Just today, the First Minister said, following his address to the Prosper forum:
“A strong economy is key to everything I want to achieve as First Minister. We will make our planning system work better, expand apprenticeships and devolve powers to Regional Partnerships, helping to create more jobs.”
I say to Willie Rennie that the point about wealth creation brings an important balance to this debate. The Scottish Government proves that by giving more revenue to front-line services while most taxpayers pay less than they would in England.
The debate is also about Scotland’s future governance. With independence, we would have full control over our levers. We have heard today about corporation tax, inheritance tax and capital gains tax, We could also use comprehensive wealth taxation to build the fairer, more prosperous country that we know is possible.
In the meantime, we must use every devolved power that we have to push for more fiscal responsibility from Westminster and must lead by example, because this is about our values as a nation. We want a Scotland where opportunity is determined not by the wealth that people inherit but by the talent and effort that they bring; one where our schools, NHS and communities are properly funded so that every child has the best start and every family feels secure; and one in which we build a thriving, inclusive economy.
We continue to hear requests from other parties for more funding for public services but with no explanation of how they would pay for that. Reform and the Tories propose tax cuts now, but that would cut our block grant now when we are talking about creating future economic growth.
I am willing to take an intervention if Mr Hoy would like to come in on that point.
For clarification, the Scottish Conservatives proposed £1 billion-worth of tax cuts and £1 billion-worth of benefit cuts, which was absolutely axiomatic.
Earlier, we heard Shirley-Anne Somerville make the point that welfare cuts would come from the Tories. However, their approach is not one that I would support.
I go back to my key point. Making tax cuts now would also cut our block grant now, which in turn would mean cuts to our public services now, while Labour’s rise in employer national insurance contributions is damaging growth.
I urge members to back carrying out a bold exploration of wealth taxation measures. Let us publish detailed options, engage with experts and unions, and deliver concrete proposals. We need to reform our public services and increase growth in our economy, but we also need to tax wealth fairly if we are to invest in our people and secure a better future for generations to come. Scotland deserves nothing less.
16:16
This debate has been far more interesting than I thought it might be, and I was glad to hear quite a lot of consensus across the chamber about the need to modernise the state. I would suggest that that is a good thing for us to do anyway, but it is now urgent and necessary. I was particularly struck by the Labour amendment and the tone of Michael Marra’s contribution and I think that there is scope for joint work. I am glad that we will accept the Labour amendment, because it acknowledges the scale of the issues that we all face. There is scope for consensus and for joint work across the chamber, and I was glad to hear the tone of Labour members’ contributions, because there is a lot of work to do. “From each according to their ability to each according to their need” is a fundamental principle of our party and of the Labour Party and the Greens, so there is scope for joint work on a lot of matters.
We need to modernise the state to be more efficient and effective and to provide better public services, but we also face a fiscal challenge. There are a number of things that we can do. It will come as no surprise to anyone that I support the Government’s position and its motion. I very much welcome the idea of a mansion tax and a private jet tax, but even we, in the SNP, acknowledge that that is not the answer—it is part of the answer, but there is a much bigger job to do. I was glad to hear from the Deputy First Minister about progress on council tax reform, because that is urgent and long overdue, and it must be done.
We had a helpful briefing from the STUC, which outlines a few other measures that could be taken forward, and I commend it to members. It says:
“The Scottish Parliament should immediately launch a revaluation of properties to replace the out-dated, unfair Council Tax with a proportional property tax. While a mansion tax is a step in the right direction, it is a poor substitute for the wholesale, systemic reform of local property taxation.”
I could not agree more, and I am glad to hear that the Government is redoubling its efforts on that. It goes on to say:
“Research for the STUC estimates that a proportional property tax could raise £783 million in additional revenue, while providing a rebate for low-income households.”
That necessary reform is overdue and could be very productive.
We also need to focus more on the polluter-pays principle, incentivising good behaviour and punishing bad. There are other things that we could do to encourage climate action.
We must reform non-domestic rates. I am glad that the Gill review is under way for licensed premises, because licensed hospitality is taking a soaking because of sudden revaluations. The Scottish Government is acting on that, but we need to act much more urgently to reform non-domestic rates in the round, because the system is not fit for purpose at the moment.
The briefing refers to introducing a tax on wealth, which colleagues have spoken about,
“provided this is implemented as part of the local tax system rather than a national tax. While this would be complex, modelling suggests it could raise £1.4 billion.”
I support the Government’s motion and the efforts that we are making on those measures, but there are a number of other things that we need to be doing beyond them.
In mentioning all the things that the Government needs to be doing, does the member regret that the Government has now had nearly 20 years in which to do those things but has utterly failed?
It will come as no surprise to Liam Kerr that the operation of fiscal matters, given the interplay of reserved and devolved legislation, has held us back. However, we need to act on those things, and, if we agree that we need to act on them, let us do it now.
There are a number of things that we need to be doing to tax wealth, and I warmly support the Government’s position on that.
I remind members—gently, this time—that those who have contributed to a debate should be in the chamber for the closing speeches. We move to the first of those, which is the first speech in the chamber by Andrew Baxter.
16:20
I congratulate you on your election, Deputy Presiding Officer, and I congratulate all the new members in the chamber on their election.
Looking at the polling pre-election, some members must have been fairly certain that they would sit here as MSPs. I remain surprised that I stand here today to make my first speech to the Parliament, although perhaps not quite as surprised as my SNP colleagues. After all, many people said that overturning a majority of more than 15,000 votes in Skye, Lochaber and Badenoch, which was one of the SNP’s safest seats, was simply impossible. However, that previous majority was a reflection of the immense popularity and dedication of my immediate predecessor Kate Forbes and of Fergus Ewing, who, before the recent boundary changes, represented part of my constituency with equal distinction. I follow two remarkably hard-working politicians who, in very different ways, represented both their constituents and the wider Highlands with passion and conviction. Although it remains unclear whether all their former colleagues fully recognise the loss that their departures represent to their political movement, it is clear that this Parliament is the poorer for their absence. We will all watch with interest to see what roles Kate and Fergus play in Scottish public life in the future.
I have listened to numerous first speeches from colleagues from every party, and it seems that the first speech is an opportunity for unabashed political boasting—a version of constituency top trumps. I am willing to take on any member at that game, because I believe that I hold all the best cards. My Skye, Lochaber and Badenoch constituency has Britain’s tallest mountain, Ben Nevis; our deepest loch, with its own forgotten monster, Morag; the largest body of fresh water in the UK, Loch Ness, with its rather more famous monster; the most westerly point on the British mainland at Ardnamurchan; three of Scotland’s five ski centres at Glencoe, Nevis and Cairngorm; the largest landslip in Britain, the beautiful Trotternish ridge on Skye; the world porridge-making championships in Carrbridge; and Dingwall, the site of a Norse Parliament that predates the so-called mother of Parliaments at Westminster.
Last but certainly not least, my constituency has a network of incredibly determined and resilient communities that, when faced with the reduction or loss of a public service, never simply accept that that is the end of the matter. They roll up their sleeves, organise, fundraise, volunteer and get things done. Perhaps that is why support for the Liberal Democrats has traditionally been strongest in the Highlands—like those communities, we believe in getting things done.
Today’s debate is about wealth taxation and how we fund our public services. It is an important discussion and I welcome it. Those with the broadest shoulders should make a fair contribution towards the services on which we all rely. However, if this Parliament is serious about funding public services properly, we must look beyond wealth taxation alone.
We must also confront the urgent need for reform of council tax and non-domestic rates. Businesses across the Highlands continue to struggle with a rates system that often bears little resemblance to economic reality while local government—the largest provider of many of our public services—continues to shoulder ever greater responsibilities with ever fewer resources.
Having served for 12 years as a Highland councillor, I have watched local government being hollowed out. Services have been centralised, reduced or removed altogether. It is fortunate that many of the communities that I spoke about earlier have stepped in to fill the gaps. However, volunteer goodwill is not an unlimited resource. Communities cannot be expected to indefinitely provide public services at cut-price rates while government retreats.
Ultimately, this debate is not about tax; it is about people. For 17 years, I ran Kinlochleven post office. Behind the post office counter, I saw people at their very best and at their lowest ebb. Behind every transaction was a story. There was the small business owner frustrated by watching decades of underinvestment in Highland roads that added costs, delays and uncertainty to every working day, and the supermarket worker struggling to stay in employment because bus services had been cut back—a £2 fare cap means very little if there is no reliable bus to catch. There was the parent furious that their child had gone an entire academic year without a permanent maths teacher as they approached their national 5 exams, and the man living with bipolar disorder who was being told that he would have to wait a month for a telephone appointment with his own general practitioner. There was the patient living with chronic pain and facing repeated long journeys simply to access treatment that should be available closer to home; the single mother checking her balance and realising that she had only a few pounds left to feed the meter while living in a damp council house with ageing storage heaters and no prospect of improvements; and the lady in the early stages of dementia, who I hugged every week, who stood bewildered, confused and with tears streaming down her face because she did not know what to do when her husband—her rock—was placed in a care home two hours away because there were no beds closer to home. That is the reality of public services for too many constituents.
My motivation for standing for election was simple: I want to be a champion and a voice for the Highlands, and, above all, I want to help to build public services that are accessible, reliable, closer to home and there when people need them most. That is the task that I set myself as I take my place in the Parliament, and I look forward to working with members across the chamber to deliver it.
16:28
I start by welcoming Jenny Gilruth to her new position as finance secretary and also Hannah Mary Goodlad, whom we look forward to hearing from shortly.
I also congratulate all those who made their first speeches—Kim Schmulian, Katie Hagmann, Martyn Day, Joe Fagan, Iris Duane and Andrew Baxter. I do not want to single anybody out, but I thoroughly enjoyed Andrew Baxter’s audio tour of his constituency’s highlights. I think that I have climbed most of the mountains in his constituency, and I hope to complete the rest of them this summer—weather permitting.
We are talking about wealth taxation for public services, and ensuring that we have well-funded and effective public services is a worthy ambition. However, we cannot increase taxes to a level where it becomes counterproductive. Liam Kerr made that point earlier when he quoted the economist Arthur Laffer, who made that case many decades ago with his famous curve.
Will the member take an intervention?
Oh, so soon! I will, of course, give way to Mr McKee.
Does Murdo Fraser agree that, although the Laffer curve says that not all increases in tax rates result in an increase in revenue, it does not say that all reductions in tax rates automatically result in an increase in tax revenue? Malcolm Offord clearly does not understand that.
That is not all that Malcolm Offord does not understand, to be fair, but I agree with Mr McKee’s basic premise, and I hope that Mr Offord would, too.
The biggest growth in the Scottish budget is not spending on public services but spending on benefits. We learned this week from another place, the Mandelson files, that the Secretary of State for Work and Pensions, Pat McFadden, said:
“Every meeting I have is ‘who can we tax in order to pay benefits to others.’”
The Scottish Government sounds as though it is pretty much in the same boat, because we are facing a £5 billion black hole in the public finances by the end of this decade not because public spending on services is going up but because of the exponential rise in benefits. Throughout the debate, Willie Rennie has made a doughty attempt—as we would expect from him—to get answers about how that gap will be filled. The cabinet secretary seemed to indicate that taxes were not going to go up. I saw reported comments from Mr McKee earlier this week trying to deny the image of the mad axeman, or Ivan the Terrible, as some people are, disgracefully, trying to present him. The Government says that it would not preside over cuts, but if it will not put up taxes and there are not going to be cuts, how are we going to fill the gap? I will happily give way to anybody sitting on the SNP front bench if they can give me an answer to that question.
I am a public service reformer.
Maybe Mr McKee was misquoted in the interview that I saw, when he said that public service reform was not about reducing costs.
Cuts mean putting less funding in and delivering fewer services. The issue is efficiency, which is about improving the level of service by addressing all the issues that are laid out in the 18 workstreams in the public service reform strategy. As a consequence of that, those services will become more efficient and cost less money.
I think that we will be debating those issues next week, so I am sure that we will get much more clarity from Mr McKee on what exactly is going to happen.
What has the debate been about? It has been about more wealth taxes. The motion talks about celebrating a mansion tax and a tax on private jets. That is going in entirely the wrong direction. Scotland should be encouraging wealth creators and creating a welcoming environment for those of high net worth who want to come here to live, work and invest, because that is clearly in our economic interest. Scotland has already become the highest taxed part of the United Kingdom, and we know that the population of Scotland is growing less quickly than the population of the UK as a whole. We are not attracting the people here in the numbers that we need to grow our tax base.
All the time, the business community tells us that differential taxes in Scotland are a barrier to attracting talent. We know that there are people working in the public and private sectors in Scotland who restrict their working hours because the tax burden means that it is not worth their while to work more, and now the SNP wants to make matters worse. Perhaps Keith Brown can reassure me that that is not the case.
I am just trying to work out what the Conservatives’ approach is. In the previous session of Parliament, virtually every single member of a group of nearly 30 members—maybe more than that; it is now reduced—advocated more public expenditure in virtually every area of Government and yet wanted to cut Government income. That is the economics of Liz Truss. It is also true to say that the Conservatives presided over a national debt of more than £3 trillion and the highest tax burden since the second world war. Why should we believe in the voodoo economics of the Conservatives?
What we have to do is deliver economic growth. If we can grow and expand the tax base, we do not need to increase tax rates to get the revenues that we need. That is where the Scottish Government has been failing. The Scottish Fiscal Commission talks about the economic growth gap that my colleague Craig Hoy referred to earlier.
People talk about the private jet tax as something to celebrate. I was recently told by tourism leaders that the fastest-growing sector in Scottish tourism is what they call the high end of the tourist market. That now represents 30 per cent of total income and is expanding rapidly. That is high-net-worth individuals—wealthy people—choosing to come and visit Scotland, and what are we going to do? We are going to try to introduce a private jet tax to discourage them from coming to Scotland. That is the opposite of what we should be doing.
I can remember—as will some other members here—when Fergus Ewing was the tourism minister. Fergus Ewing argued for years that air passenger duty should be devolved so that it could be passed to this Parliament and the Scottish Government could cut it in order to encourage more people to fly here, but guess what? It has now been devolved—we now have air departure tax—but what is the Scottish Government going to do? Will it do what that wise man Fergus Ewing said and cut the tax? No—it wants to put it up. It wants to make it more difficult for people to come here. It wants to damage Scottish tourism. If only we could get Fergus Ewing back.
We know that we have a problem with the lack of venture capital in Scotland. We are very good at generating ideas. We have great spin-offs from our universities, but once they get above a certain size, they cannot get the venture capital that they need in order to grow. Therefore, many end up being sucked away to the golden triangle in the south of England or overseas to the west coast of the US.
The reason why we do not have enough venture capital in Scotland is that we do not have enough venture capitalists in Scotland, because venture capitalists want to invest in businesses close to where they live. That is why there is a virtuous circle of venture capitalists and growing dynamic tech companies in the south-east of England and we do not have the same opportunities here. If we send out messages that we want to tax the better-off people more and more, we will drive people away, drive investment away and lose jobs in those dynamic sectors of the economy.
What we should be doing with our tax powers, instead of constantly increasing the tax burden, is making Scotland competitive and attracting more wealthy people to come here. Whether they are coming on holiday, to invest, to set up businesses or to purchase property, let us encourage them. The fiscal framework that determines the overall level of the Scottish budget depends on relative income tax performance between Scotland and the rest of the UK. If we have more high-net-worth individuals in Scotland paying more tax, we will generate proportionately more money to fund our public services. That is the approach that we should take, not wealth taxes that will raise very little, cost a fortune to collect and drive away the very people, businesses and capital that Scotland needs. That is the point that we make in our amendment and I encourage members to support it.
I call Kate Nevens, who is making their first contribution.
16:37
It is a privilege to be here and to represent the Edinburgh and Lothians East region. I thank everyone who cast their vote for us in the election, as well as all the incredible activists and supporters who helped by knocking on doors, posting leaflets, putting up posters and sharing gen Z green memes that I mostly did not understand.
I am proud of our campaign. It was a campaign that, as Iris Duane mentioned, ran on the energy of hope rather than hate, in which we stood together in solidarity with those most marginalised by the current system and fought together for a fairer, greener and more just future for Scotland. I am excited to carry that energy into Parliament with me.
I also thank Alison Johnstone, my predecessor on the Lothians list, who has been an inspiring Presiding Officer for the past five years and who has left an incredible green legacy as an MSP.
I realise that some members might already be aware of me as the newly elected MSP with some rather radical ideas about the world, so perhaps some folk feel a little trepidatious about me. That is okay—I do not expect everyone here to agree with my world view. In fact, I welcome difficult conversations that will help us to make progress through some complex topics about which, perhaps, none of us alone has the answer.
What I hope, and what I believe to be possible, is that we can find areas where we can work together to improve the lives of people in Scotland and to bring care, collaboration and kindness to the heart of this Parliament. If there is one area where that work is most urgently needed, it is this—addressing wealth inequality through a fair taxation system and properly funding our public services. That has to be central to what we do together over the next five years.
The vast majority of us in this chamber were elected on manifestos that promised to reduce poverty and inequality. That simply cannot be done without sharing wealth more fairly and asking people who have too much to share more with those who have too little—and the public agree. Research by Wellbeing Economy Alliance Scotland shows that the vast majority of people in Scotland want the wealthy to pay more tax, not less.
As others have mentioned, Scotland’s wealth inequality is huge. The top 10 wealthiest individuals and families in Scotland are worth more than £23 billion combined, which is more than the total amount raised by Scottish income tax in a single year. That is not a natural state of affairs; it is a political choice and it has to change. Some political parties are keen to blame migrants for Scotland’s problems, but it is the presence of billionaires, not migrants and refugees, that shows us that something is wrong with our economy. If some of us have enough money to hoard houses and yachts while others are struggling to feed our families or heat our homes, that is a sign of failure, not success.
I, too, welcome the progress that has been made towards a private jet tax and a mansion tax, but we need to be bolder and braver and make the absolute most of our revenue-raising powers in Scotland. It took 18 years for us to use our income tax powers; we cannot afford to be so slow again. We need to urgently consider an Amazon tax to support local businesses, and to scrap the outdated and aggressive council tax in favour of a fairer alternative. In Edinburgh, the Greens were laughed out of the room when we first advocated a tax on hotel rooms, but we did not give up. The tourist tax that is coming into force this summer in Edinburgh will raise around £90 million over three years, and that will allow us to improve our arts spaces and green spaces and provide more housing support during the housing crisis.
My background is in working in equalities and human rights in Scotland. I have worked with communities that often experience multiple overlapping inequalities and oppressions, almost always exacerbated by wealth inequality and inadequate service provision. I know how much it would mean for us to be able to start properly addressing some of those inequalities and funding inclusive, high-quality public services.
I have also spent much of my career working on similar issues with communities and civil society groups in other areas of the world, particularly in countries such as Yemen, Egypt and Palestine, and I believe that Scotland should be playing a role in addressing global wealth inequality, too. We should be engaging in conversations on global tax justice and debt cancellation, reparations for colonial harm, and feminist economic models that centre on care and wellbeing rather than extraction.
I look forward to the next five years and to working across parties to build wealth in our communities without extracting it from workers or our natural world and to build a fairer and greener society. I hope that together, in the words of Angela Davis, we can
“act as if it were possible to radically transform the world.”
16:42
I welcome the Deputy Presiding Officer to her position and I welcome the Deputy First Minister to hers, too. I look forward to working with her in the constructive way that we did in the previous session of Parliament.
Above all else, I congratulate all the members who have spoken for the first time in the debate. There have been a few too many to name check, but I say to Katie Hagmann that, given the quality of contributions from the new members, I think that it is returning members, not the new ones, who should be nervous.
I have to begin with something that I do not want to do, which is to confront some of the comments that were made by Malcolm Offord. Frankly, they were ridiculous. First, it should come as no surprise that Labour believes in creating opportunity through better work and better pay. Secondly, he should read Alan Milburn’s report, because it calls for Government intervention to bridge the structural gap that gets in the way of so many young people in the world of work. Above all, shoehorning in a racist, dog-whistle claim about two-tiered justice in the light of what has happened in Southampton is outrageous and irresponsible.
[Made a request to intervene.]
No, I will not take an intervention from the member. If he thinks that second-rate racism such as that will stand in the Parliament, he is sorely mistaken, and he can sit down.
[Made a request to intervene.]
I say again, he can sit down.
It is a shame, because we have to have this important debate on how we can develop —
Will the member take an intervention?
I will continue my point, and the member can see whether or not it is relevant.
We have to have a debate about how we grow the economy and develop sustainable funding for public services. More broadly, I say to the parties of the right that they have to understand that this is not an either/or—we cannot cut our way to growth. Growth requires good quality public services. We need our schools to teach the right skills and knowledge; we need hospitals so that people can get better to return to work; and we need good roads so that goods and services can travel from point A to point B. This is not about either/or—we need both.
We do require some candour from this Government; its inability to acknowledge the performance gap that has been outlined by the Scottish Fiscal Commission over a number of years is worrying. That £800 million gap has arisen primarily because of
“slower earnings and employment growth compared to the”
rest of
“the UK.”
That is the definition that the Scottish Fiscal Commission has set out. If we want to make progress, both on economic growth and on public finance sustainability, we have to start by acknowledging that at least.
We also have to acknowledge longer-term growth trends. Before Ivan McKee gets to his feet, I am happy to acknowledge that economic growth in Scotland last year was 1.4 per cent, but it was only 0.1 per cent higher than the figure for the UK. In the previous 10 years—from 2014 to 2024—Scottish growth was 8 per cent, while UK growth was 14 per cent. We have to think about why we are lagging and how we can make up that difference, because economic growth is important.
Willie Rennie was absolutely right to say that we will not tax our way to growth or sustainable finances, but the issue is more important than that. Ultimately, economic growth matters because it is all about increased living standards, increased opportunities for individuals and increased wages. It matters for the Government, but it also matters for those who live and work in Scotland.
This is an important debate, but we need much more detail about how the Government will tackle these issues and the deficit that it faces. It did not want to mention the £5 billion figure, but even if it rejects that, the Government’s own figures, according to the IFS, show that we would need an extraordinarily increased rate of productivity growth in the health service just to stand still once we take account of increased pay. Additionally, the IFS identified £1.4 billion of additional pledges in the SNP manifesto. We need a grown-up, mature conversation, and it has to start from a realistic position about our growth and why it matters. Just saying, “We’re going to do reform” does not really cut it; we need to understand the detail if we are not to undermine the very public services that are so important.
Above all else, we have gone on too long talking about council tax reform and local government reform without getting into the detail. We have to reform council tax and non-domestic rates at the same time, and that needs to be done holistically. Partial tinkering around the edges might make the system much worse, given that it was arrived at in a hurried fashion in 1991 and was imperfect to begin with.
We also need to start with some principles. Let us have a non-domestic rates regime that is built on transparency, that is based on economic contribution, that does not hinder investment, and that aligns local government with the revenue from where it is generated. Perhaps that would be a starting point. If we want reform, let us at least establish the principles and have some dialogue about how it could take place. Let us get on with it, because we cannot wait another 20 years.
This is an important debate. At times, it has been useful and instructive, but we need an awful lot more candour if we are to actually make progress.
Will the member give way?
I apologise—I am out of time.
16:48
Before I start my remarks, I say to Mr Johnson that if he is going to hurl abuse—childish, petty insults—across the chamber, the least he can do is be decent and allow an intervention to come back rather than hide away. That was shameful.
I remind members that it is up to the member who is speaking whether to take an intervention.
It was interesting to see a leadership bid in this debate. If I were Mr Sarwar, I would watch out.
It is a privilege to speak in the debate and to follow Kim Schmulian, my friend and colleague, who made an impassioned speech. I cannot wait to see her contribution to the chamber over the next five years. I know all too well what it is like to grow up in poverty—
Will the member give way?
No. I am not interested, thanks.
Members: Oh!
The Deputy Presiding Officer just said that it is up to the speaker to decide whether to take an intervention.
Members, we will hear the person who has the floor, which is Mr Kerr.
It is up to me whether I take an intervention. I ain’t interested in irrelevant nonsense from a has-been party.
I know all too well what it is like to grow up in poverty. As many know, I grew up in one of Scotland’s most deprived communities—Cranhill in Glasgow’s east end. That community saw at first hand the devastation that arrogant politicians, many of whom still sit in this chamber, caused to communities such as mine, where poverty and addiction were normal and social mobility was a dream, not a reality. That is why I got involved in politics—to ensure that no child grew up believing that they could not achieve their potential simply because of their background.
That leads me into this debate, because I know that work pays. It was instilled in me as a child by two amazing, hard-working role models I had when I was growing up—Tam and Margaret Kerr, my grandparents. They made me who I am and taught me that hard work is not a slogan—it is vital in life. They understood that, if people want to provide a good life for their family, they have to earn it. Nothing came easy and nothing was guaranteed, and those values helped to shape me. They taught me that the dignity of work matters, that ambition is not something to be ashamed of and that, when people work hard, save hard and play by the rules, they deserve to keep more of what they earn.
That is why I am speaking today, because the truth is that Scotland has become a country where, increasingly, work is punished rather than rewarded. We have reached a point where workies, nurses, teachers, small business owners and countless ordinary workers are paying more tax in Scotland than they would elsewhere in the United Kingdom. People work overtime only to see more of their pay disappear. Nobody deserves to have the taxman at their door when they have worked their backside off to provide for their family.
The route out of poverty has never been dependency, and it has never been creating more barriers between aspiration and achievement. It has always been—and always will be—work. A job equals a growing economy—
Will the member take an intervention now?
Will the member take an intervention?
I will take an intervention from the cabinet secretary.
Will the member recognise that 66 per cent of children living in relative poverty in 2014 to 2017 lived in a working household and that that figure stood at 75 per cent from 2022 to 2025? This is not just about work. Work is important, but the state needs to be there to protect people who are on the lowest incomes.
I acknowledge that and I also acknowledge that it is thanks to the policy of the cabinet secretary that the people she just described are paying more tax in Scotland than they would in the rest of the UK. I want to see them keep that money in their pockets. [Interruption.] Members are heckling, but nurses, teachers, doctors, workies and small business owners pay more tax in Scotland than anywhere else in the UK. That is thanks to this SNP Government.
Will the member take an intervention?
No. I have took enough interventions, thank you.
A job equals a growing economy—[Interruption.] I am loving this, Deputy Presiding Officer.
Members, can we hear the speaker, please?
A job equals a growing economy and the opportunity for people to build a better future for themselves and their families. Government cannot create wealth by taking more and more off those who produce it. Wealth is created by workers, shopkeepers, tradesmen and businesses that take risks, create jobs and contribute to communities, and that is why—
Will the member take an intervention?
No. I am not interested in taking interventions. I have already took one from the cabinet secretary. Let me make some progress. That is why—[Interruption.] I appear to be rattling all the right people. I am enjoying this a lot, Deputy Presiding Officer.
That is why Reform Scotland believes that we must make work pay again. Our policy is straightforward. We would scrap Scotland’s complicated six-band income tax system and align it with the three-band system elsewhere in the United Kingdom. We would then cut income tax rates to below those elsewhere in the UK, allowing workers to keep more of their hard-earned money. It appears that we are not the only ones who now think in that way, as London’s very own Nicola Sturgeon has fled Scotland’s higher-tax system for an easy life in the shadow of Westminster.
We believe that lower and simpler taxes would reward work, encourage investment and make Scotland more competitive for businesses and skilled workers. That would generate more tax revenue for public services.
Unlike the SNP, we want Scotland to lead the UK, not leave the UK. For us, that is more than just numbers on a spreadsheet.
On that point, will the member take an intervention?
The member is winding up.
It is about small business owners who are wondering whether they can afford to take on another member of staff. It is about the parents struggling to pay the rent or mortgage, fill the car and provide for their children. Those people do not need another lecture from politicians. They need a Government that trusts them with their own money. Every pound left in the pocket of a hard-working Scot is a pound that can be spent in a local shop, invested in businesses, saved for a home or used to support a family. That is how the economy grows. It may be hard for the SNP to understand, but it is not rocket science.
For too long, Scotland has been held back by a political culture that believes that Government always knows best. It does not. The people we are elected to serve know best. We want a Scotland where, if people work hard, stay here legally, contribute to our country and do the right thing, they can build a better life for themselves and their families.
To close the debate and make their first contribution in the chamber, I call minister Hannah Mary Goodlad.
16:54
Thank you, Deputy Presiding Officer. I extend my congratulations to you and to all new members in the Parliament who made their first speeches today.
Giving my first speech in this place on a topic as important as this feels a little bit like when I am out on my small fishing boat as the haar starts to roll in. In a moment and in an instant, my markers are gone. The skerries and the islands that I know like the back of my hand are not in my sight any more. I have to rely on a chart and GPS to be my guide. That is what good colleagues from across the chamber these past couple of weeks have been for me—a help, showing me the dos and the don’ts and the etiquette and functionality of this place. They have helped me to navigate, they have been my chart and my guide, and I thank them very much.
It is customary in a first speech to use time to pay tribute to those who walked before. I do that warmly and with enthusiasm for Beatrice Wishart, who proudly and diligently worked hard in this chamber to serve the islands of Shetland. I also acknowledge and recognise the work that Beatrice did to advance the rights of women and girls across Scotland. That was a passion of hers, and she was the first woman in Shetland to be elected to the Scottish Parliament. That paved the way for many young women and girls who came after her, which is no mean feat.
It is my greatest joy to take my seat in this place and to work to the best of my ability for our beautiful home, the Shetland Islands. However, Shetland is more than just beautiful. Our character is resilient, innovative and hugely ambitious. Someone once described Shetlanders to me as being like a muckle partan in a creel, and when he birses on tae da side o it, dere’ll be no slippin it until he’s afore time. Basically, when Shetlanders get an idea, we run with it, with a tenacity and a determination that is unrivalled.
The tenacity of the place and the people inspire me every single day. One of the best examples of that inspiration is the Zetland County Council Act 1974. The 1974 act was perhaps the most transformative piece of legislation that our islands have ever seen. Oil was discovered off our shores, and the elected representation of the time decided that that newly found wealth should work for the people of Shetland, and, importantly, that we should have control over that wealth. The people did not wait around to be handed their lot; they took their chance and they created opportunity. Those who crafted that vision were ridiculed. They were told that it would never work. They were told that Shetland was too small, too remote, too weak and too naive. They were told, “Get back in your lane and know your place.” Does that sound familiar?
It did work. Over the years, their vision has created a substantial community wealth, which we have invested in our infrastructure and in our public services, charities and the third sector. A group of small islands at 60º north punched above our weight big time, and we did not accept no for an answer. We had unbounded stamina and we persevered.
That is an attitude that Scotland can learn from. It is an attitude that Shetland needs to find once again, because that attitude is at the heart of the kind of society that we want to create. What kind of Scotland do we want the next generation to inherit?
The substance of today’s debate is about exactly that: what kind of society we want the next generation to inherit. I thank and commend all the first-time speakers today—it is not an easy position to be in, but everybody has made a sterling effort and added to the substance of the debate.
I have picked out three themes in the debate, and the first is cross-party collaboration. I could feel it in the chamber today—the idea that this is the tell-tale session of Parliament in which we will deliver real progress on massive issues that will determine the success of our time here. Michael Marra mentioned, I think, that this session will be the defining moment of our time. The potential that lies ahead in getting it right is massive, so I welcome the cross-party collaboration, talks, debate and discussion that lie ahead. That work will happen not only during the budget process—it begins now.
The potential that lies ahead for public sector reform is vast, as well, in moving to a more preventative model with joined-up thinking and services and efficiency right at its heart. We will hear more about that next week.
I give Willie Rennie a commitment to detail and to be as boring as we can be—I look forward to seeing what an excited Willie Rennie looks like, so we will go on that. [Laughter.] I give a commitment to focus on the 1 per cent and to sweat the small stuff, because it is right to say that when people drill down into the detail, that is where change happens.
I want to talk about facts and opinions. We should try to stick with the former in everything that we do. I held that principle in the campaign that I ran, and it is a principle that I, as a scientist, take into the chamber. Colleagues to the left of me—geographically, in this place—would do well to bear that in mind.
The claim that elderly people are having to explore equity release for the UK mansion tax is simply wrong. The UK Government’s planned mansion tax is not yet in force and is not due until April 2028—in fact, the UK Government is still consulting on the policy.
Of course, we then strayed into too-familiar, and unwelcome, territory once again in hearing the rhetoric of division and hate. I have no idea in my mind of what a “home-grown” Scot is, nor of who “our own people” are. That kind of rhetoric has no place in a welcoming Scotland. We have a history—again, I say this to the members to the left of me geographically—of welcoming in this country, and we have a future of belonging.
I will finish on the ask and the offer, as my good colleague Katie Hagmann set out. The ask in Scotland is great, but the offer is greater. We have free tuition fees in this country and there are no prescription fees. The child payment is ambitious and it is keeping people out of poverty. We have a nationalised rail service and Scottish Water. We have a majority in the Parliament that is made up of members of different parties who stood on manifestos for a progressive tax policy. The voters have returned those parties to the Parliament in significant numbers, so let us give the voters the credit that they deserve and zoom in on that.
In Shetland, when we go to sea, we understand something important: you can navigate only with the tools that you have on board. You know where you want to go, but if someone else controls the engine or decides which fuel you are going to have, there are limits on how far you can steer. That is the challenge that we face today. This Government has used the powers that are available to this Parliament to build a progressive tax system. We have invested in public services and managed Scotland’s finances responsibly, balancing the budget each year, as challenging as that is.
We have also had to contend with decisions made elsewhere—the recent increase in employer national insurance contributions is one example. That money could otherwise have supported our NHS, our schools and our communities. Despite those pressures, we continue to make choices about fairness and the kind of Scotland that we want to build.
That is why the Government has committed to a serious and informed discussion about wealth taxation—not a rushed conversation, but one grounded in evidence. A comprehensive review of wealth taxation will shortly be published, examining how wealth is taxed elsewhere, what lessons can be learned, including internationally, and what approaches may be relevant for Scotland.
You need to wind up, please.
Sorry. Let me cut out some of this, then—I can do that on the fly. I will make sure to feed back to my staff that, in the future, things have to be shorter.
In five years, I want to look on a different kind of Scotland—a Scotland that is more at peace with itself and a country where public services are strong, sustainable and accessible. Five years from now, I want us all to be able to look one another in the eye knowing that we have pushed the boundaries to create a better country, and that we have held the four words on the mace at the front of this chamber in our hearts and minds every single day. Wisdom, integrity, justice and compassion—those four words are as good a compass as any, on a misty day when the haar rolls in, for navigating what is ahead.
That concludes the debate on wealth taxation for public services.
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