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Chamber and committees

Meeting of the Parliament [Draft]

Meeting date: Wednesday, June 12, 2024


Portfolio Question Time

Deputy First Minister Responsibilities, Economy and Gaelic

Good afternoon. The first item of business this afternoon is portfolio questions, and the first portfolio is Deputy First Minister responsibilities, economy and Gaelic.

Gaelic Language Skills

1. Alasdair Allan (Na h-Eileanan an Iar) (SNP)

To ask the Scottish Government what its response is to the recently published data from Scotland’s census on the number of people with Gaelic language skills.

Gus faighneachd de Riaghaltas na h-Alba dè a bheachd air na figearan a chaidh fhoillseachadh o chionn ghoirid bho chunntas-sluaigh na h-Alba a thaobh na h-àireimh de dhaoine aig a bheil sgilean sa Ghàidhlig? (S6O-03549)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

Tha Riaghaltas na h-Alba a’ cur fàilte air an àrdachadh air luchd-labhairt na Gàidhlig sa chunntas-shluaigh—a’ chiad uair bho 1971 nach fhacar ìsleachadh san àireimh sin. Tha seo a’ sealltainn an adhartais a rinneadh le obair às leth na Gàidhlig ann am foghlam, craoladh agus planadh coimhearsnachd is cànain. Ach, tha sinn ag aithneachadh nan duilgheadasan èiginneach a tha fhathast ann—agus sin follaiseach bho mar a thuit àireamh luchd-labhairt nan eilean. ’S e an dùbhlan fuasgladh fhaighinn air na duilgheadasan seo gus am bi Gàidhlig seasmhach nar n-eileanan agus a’ fàs air feadh Alba.

The Scottish Government welcomes the rise in Gaelic speakers recorded by the census. This is the first census since 1971 not to show a decline in speakers, and that demonstrates the progress being made in education, broadcasting and the community, but we recognise the urgent difficulties still facing the language—something that was highlighted by the on-going decline in speakers in our island communities. Our challenges lie in tackling those difficulties to ensure that Gaelic is sustained within island communities while enjoying growth across the whole of Scotland.

Alasdair Allan

Ged a tha e fìor mhath fhaicinn gu bheil deagh bhuaidh air a bhith aig goireasan ùra airson luchd-ionnsachaidh na Gàidhlig, mar a thuirt am ministear, tha na figearan ag innse sgeulachd eadar-dhealaichte ann an sgìrean far a bheil, no far an robh o chionn ghoirid, a’ Ghàidhlig air a cleachdadh gu làitheil.

An urrainn don rùnaire barrachd a chantainn mu dheidhinn ciamar a tha na figearan seo, a tha a’ sealltainn crìonadh de luchd-labhairt ann an sgìrean Gàidhlig, a’ dol a thoirt buaidh air poileasaidh an Riaghaltais a thaobh taic làidir a stèidheachadh gus a’ Ghàidhlig a dhìon airson an àm ri teachd?

While it is welcome to see the impact of new and accessible resources for Gaelic learners on the overall number of speakers, the statistics tell another story in the Gaelic heartlands, as the cabinet secretary said. Can the cabinet secretary say how census data showing a decline in the number of Gaelic speakers in those communities will impact on the Scottish Government’s policy strategy to support the language’s long-term survival?

Kate Forbes

Tha Riaghaltas na h-Alba ag aithneachadh gu bheil e fìor chudromach dèiligeadh ri lùghdachadh àireamh luchd-labhairt na Gàidhlig sna coimhearsnachdan seo. An-dràsta tha sinn a’ leasachadh dà dhòigh-obrach poileasaidh ùr a th’ air am fiosrachadh le toraidhean a’ chunntais-shluaigh is a tha a’ cur taic ris a’ chànan aig ìre na coimhearsnachd. ’S e na sgìrean cànain sònraichte a thèid a chur an sàs le Bile nan Cànan Albannach ceum a dh’ionnsaigh ath-bheothachadh cànain a tha stèidhichte air a’ choimhearsnachd.

Nar freagairt don bhuidhinn-obrach gheàrr-bheatha air cothroman eaconamach is sòisealta don Ghàidhlig bidh sinn a’ dèiligeadh ris na cùisean eaconamach nas doimhne a tha sònraichte ris na coimhearsnachdan dùthchail is eileanach air an tug sibh iomradh. Tha iad seo a’ togail air iomairtean a tha mu thràth an sàs leithid poileasaidh “Gàidhlig mar Chiad Chànan” Chomhairle nan Eilean Siar is an obair a tha Bòrd na Gàidhlig a’ leantainn le buidhnean ionadail gus planaichean Gàidhlig coimhearsnachd ullachadh ann an Uibhist agus Leòdhas.

Agus anns a’ Bheurla: the Scottish Government recognises the urgency of addressing the decline. We will do that through the Scottish Languages Bill and through the short-life working group, building on existing initiatives such as the Gaelic first policy in Comhairle nan Eilean Siar.

Intergovernmental Relations

To ask the Scottish Government what its priorities are for improving intergovernmental relations with the United Kingdom Government. (S6O-03550)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

Intergovernmental relations have faced significant challenges since the Brexit referendum. The effective powers of the Scottish Parliament have been reduced, and the UK Government has asserted a role in matters for the Scottish Parliament in a way that was not intended by the devolution settlement.

The general election presents an opportunity to reset the relationship, especially if there is a new UK Government that takes a more constructive and respectful approach to relations and devolution. We will be ready to engage following the election, whatever its outcome, to deliver for Scotland, while continuing to resist further encroachment into devolved policy and decision making.

Clare Adamson

The Institute for Government told the Constitution, Europe, External Affairs and Culture Committee:

“the operation of the intergovernmental relations machinery still tends to be quite patchy and dependent on the extent to which individual ministers and secretaries of state prioritise engagement with the devolved bodies.”—[Official Report, Constitution, Europe, External Affairs and Culture Committee, 16 March 2023; c 8.]

The Deputy First Minister has outlined some of the challenges that we have had, but we cannot have trust if we do not have the confidence that we can effectively legislate here. Does the Deputy First Minister agree that the best way forward for Scotland to engage would be on an equal footing as an independent nation, in control of our own affairs?

Kate Forbes

Having been until very recently on the Constitution, Europe, External Affairs and Culture Committee, which is ably convened by Clare Adamson, I take on board her comments in relation to the Institute for Government’s evidence to the committee. She is absolutely right that engaging as an equal partner is the only way of guaranteeing that the powers of the Parliament are respected, which would certainly be in stark contrast to our experience to date.

Green Industrial Strategy (Hydrogen)

3. Kevin Stewart (Aberdeen Central) (SNP)

To ask the Scottish Government, as part of its work to develop a green industrial strategy, what discussions the economy secretary has had with ministerial colleagues regarding the role of hydrogen production in boosting economic growth. (S6O-03551)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

The Cabinet Secretary for Net Zero and Energy and I have joint responsibility for, and are engaged in extensive discussions on, the green industrial strategy, which will set out a clear view of the economic sectors and industries in which we have the greatest strengths and potential to develop globally competitive industries.

The development of a domestic hydrogen sector and hydrogen production for export, supported by a strong supply chain—including in Kevin Stewart’s constituency—will play an important role in supporting that just transition. The growth of our hydrogen sector presents significant long-term economic opportunities for Scotland and is a priority opportunity area for green growth.

Kevin Stewart

What is the Government doing to maximise our potential by ensuring that vital plant required for hydrogen production is manufactured in Scotland? Are the likes of the enterprise agencies and the Scottish National Investment Bank actively providing support to companies in Scotland that might wish to diversify into areas such as the production of hydrogen electrolysers?

Kate Forbes

In short, Scottish Government officials and the enterprise agencies are maintaining close connections with domestic and international hydrogen developers to develop opportunities to attract electrolyser manufacturers to Scotland.

In 2023, we commissioned an assessment of the state of electrolyser manufacturing globally to support an understanding of the supply chain opportunities in Scotland. The figures speak for themselves: the “Scottish Hydrogen Assessment” report concluded that large-scale production of renewable hydrogen could create and protect between 70,000 to more than 300,000 jobs and has potential gross value added impacts of between £5 billion and £25 billion a year. The potential is enormous.

Brian Whittle (South Scotland) (Con)

To make the most of Scotland’s huge opportunity in relation to the green hydrogen economy will require investment of significant scale, yet the Scottish Government has cut that budget. It will take hundreds of millions of pounds to effect the change required to create those jobs in a just transition. Will the Scottish Government make the investment required to realise Scotland’s potential?

Kate Forbes

This is an area where we see huge opportunity for Scotland, but we also need to be blunt in recognising that the investment required is of such a scale that it will require both Governments to work together, as well as work with the private sector. We need clarity and certainty from the United Kingdom Government on the scale of the investment. The Scottish Government will continue to invest where we see big opportunities, but we need partners in the private sector and the UK Government to join us.

Beatrice Wishart (Shetland Islands) (LD)

Given Shetland’s long history of energy production expertise, what role does the Scottish Government see for Shetland in the future Scottish hydrogen production industry and in terms of economic growth potential?

Kate Forbes

I see huge opportunity for Shetland and for our other island communities, too. As a representative of one such community myself, I think that with such a transition, we need to make absolutely sure that the benefits are enjoyed and that there are legacy benefits for our islanders in particular. I think that Shetland—and, if I may say so, Orkney—demonstrated how to support communities in the last energy transition, and we can learn from them and implement those lessons in this transition.

Brexit (Economic Impact)

To ask the Scottish Government what assessment it has made of the impact that Brexit is having on Scotland’s economy. (S6O-03552)

The Minister for Employment and Investment (Tom Arthur)

Scotland’s economy is continuing to suffer from the effects of the United Kingdom’s exit from the European Union, a decision that the Scottish public were strongly against. The latest modelling by the National Institute of Economic and Social Research finds that the UK economy is currently 2.5 per cent smaller than it would have been as an EU member. It is estimated that that figure will rise to 5.7 per cent by 2035.

Businesses continue to feel the difficulty of new trading arrangements. The latest results from the business insights and conditions survey showed that, of the businesses with 10 or more employees in Scotland that faced challenges with exporting, 38.5 per cent named Brexit as the main cause. That figure rose to more than 40 per cent in sectors such as manufacturing, retail and wholesale.

James Dornan

The National Audit Office has reported that more than £4.7 billion of public money is forecast to be spent on post-Brexit border arrangements, and His Majesty’s Revenue and Customs has estimated that customs declarations could cost UK businesses around £7 billion every year. Can the minister provide any update on what assessment the Scottish Government has made of the continued cost of Brexit to the taxpayer and to businesses—unlike both Labour and the Conservatives, who wish to deny that it is happening?

Tom Arthur

As outlined, the latest analysis by the NIESR suggests that the UK economy was around 2.5 per cent smaller in 2023 than it would have been under continued EU membership. That means that around £69 billion was wiped from national income in 2023, which equates to £28 billion of tax revenue. In Scotland, that equates to lower public revenues of around £2.3 billion in 2023.

Brexit has also added further fuel to the cost of living crisis. Research by the London School of Economics centre for economic performance suggests that an increase in trade barriers has pushed up average household food costs by £250 since December 2019. Those costs disproportionately impact low-income households, who spend a greater proportion of their income on food.

Retail Sector (Support)

To ask the Scottish Government whether it will provide an update on what action it is taking to support the retail sector. (S6O-03553)

The Minister for Employment and Investment (Tom Arthur)

Our retail strategy sets out how we will work with businesses and trade unions to deliver a strong and prosperous retail sector, in line with the vision of the national strategy for economic transformation. The strategy sets out a clear vision for a retail sector in Scotland that is successful, resilient, sustainable and profitable. It seeks to build on retail strengths and to maximise opportunities for the sector to fulfil its potential and contribute to our economic transformation. Many retailers in Scotland also benefit from the small business bonus scheme—the most generous of its kind in the United Kingdom—which offers up to 100 per cent relief from non-domestic rates.

Murdo Fraser

I thank the minister for his response, but the latest retail sales figures suggest that the sector is struggling. Of course, the sector is also struggling due to the fact that the Government did not pass on the 75 per cent rates relief that is available elsewhere in the UK to retail, hospitality and leisure businesses.

In the budget at the end of last year, the Scottish Government raised the possibility of an additional penalty—a rates surtax—on larger grocery stores, which the sector is very strongly opposed to and would find very damaging. Does the Scottish Government intend to proceed with that?

Tom Arthur

In my previous role as the Minister for Community Wealth and Public Finance, along with the then Deputy First Minister and Cabinet Secretary for Finance, I was part of several meetings with retail. Since taking up my new post and assuming the lead responsibility for retail, I have met the co-chair of the retail industry leadership group. At all those meetings, the matter was discussed in depth. Although a formal decision has not yet been taken, we are considering the representations from industry very seriously, and I am acutely aware of the concerns that they have expressed.

Daniel Johnson (Edinburgh Southern) (Lab)

I remind members of my entry in the register of members’ interests and the fact that I am a member of the Union of Shop, Distributive and Allied Workers.

I was at the Scottish Grocers Federation election event yesterday afternoon. What is clear is that the biggest issue that the sector faces is retail crime. Indeed, the USDAW survey shows that the proportion of retail workers reporting that they have suffered violence has risen from 2 per cent in 2016 to 18 per cent. Although that is largely a justice issue, will the minister outline how bodies such as the industry leadership group could be used to coalesce and provide an interface with other parts of the public sector, and will he outline in what other ways the economy brief and portfolio is looking at how it can tackle that issue, which the industry is facing?

Tom Arthur

I join Mr Johnson in recognising the serious concerns that have been raised, and I commend him for his long-standing interest in this area and his leadership in taking forward a member’s bill in the previous session of the Parliament.

The specific matter that Mr Johnson highlights was raised in my conversations with the co-chair of the industry leadership group, and I am happy to confirm to him that there has been engagement on it, including with the participation of the Minister for Victims and Community Safety, Siobhian Brown. There is cross-ministerial engagement on the issue, and I would be happy to provide more detail in writing to Mr Johnson, if he would be interested, on the engagement that is taking place and the work that has been taken forward.

Jackie Dunbar (Aberdeen Donside) (SNP)

The Scottish Retail Consortium is optimistic, citing Scottish Government policy, including the council tax freeze, as helping to “support demand”.

Given that the cost of living crisis continues to impact household budgets, will the minister detail how the Scottish Government will continue to support retail and shoppers, putting money back in folks’ pockets?

Tom Arthur

As Scotland continues to face a cost of living crisis, the current high levels of inflation, although they are coming down, have disproportionately impacted the most vulnerable in society and have heaped more pressure on our public services. The Scottish Government recognises the pressure on household budgets, which is why, since 2022-23, we have continued to allocate around £3 billion a year to policies that help to tackle poverty and protect people as far as possible during the cost of living crisis.

We have consistently called on the United Kingdom Government to provide additional support to help people with the cost of living crisis, but the Chancellor of the Exchequer has failed to deploy the full range of powers that are available to him to make the difference that would be required.

Entrepreneurs and Start-ups (Support)

To ask the Scottish Government how it plans to support entrepreneurs and start-up businesses. (S6O-03554)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

We have a clear ambition to support entrepreneurs and become a leading start-up economy. That is evident through the progress in the delivery of the national strategy for economic transformation; the “Scottish Technology Ecosystem Review” report; and the “Pathways: A New Approach for Women in Entrepreneurship” report.

Key successes include the £42 million Techscaler programme; two competitive funding rounds through the ecosystem fund and the pathways pre-start fund; and “The Entrepreneurial Campus” blueprint. Those initiatives are designed to foster entrepreneurial activity and support start-up businesses.

Gordon MacDonald

Despite promises that leaving the European Union would remove red tape, the most immediate impact of Brexit on entrepreneurs was the change in VAT regulations. With United Kingdom businesses now treated as those in a third country, VAT now applies to imports from and exports to most EU countries. Retail Economics and Tradebyte are reporting an 18 per cent drop in non-food exports from the UK to countries in the single market.

Will the cabinet secretary say more about the impact that the Scottish Government expects that those checks will have on small Scottish businesses?

Kate Forbes

The impact of Brexit has certainly been painfully felt by both exporters and importers, who have seen trade with the EU become overcomplicated and saddled with additional costs. That is thanks to the fact that there are now new barriers to trade; supply chains have been disrupted; and food prices have been driven up. In fact, a recent National Audit Office report estimated that UK traders will face additional costs of £469 million a year. We are gravely concerned about those burdens, and we urge the UK Government to pragmatically align standards with the EU in order to abolish some of those burdens.

Unemployment (Edinburgh)

To ask the Scottish Government what it is doing to address the rise in unemployment in Edinburgh as recently reported by the Office for National Statistics. (S6O-03555)

The Minister for Employment and Investment (Tom Arthur)

In 2024-25, the Scottish Government has allocated up to £90 million for employability services. Edinburgh has a strong local employability partnership that is led by key employability stakeholders, including public, private and third sector organisations. The no-one-left-behind approach is delivered locally, ensuring that individuals receive person-centred and tailored support to help them to progress into sustainable employment.

The Edinburgh and south-east Scotland city region deal has a key role in helping the region to thrive. The Scottish Government will contribute £300 million over 15 years, including £25 million towards an integrated regional employability and skills programme.

Sue Webber

Unemployment in Edinburgh has risen by more than 50 per cent from December 2022 to December 2023. Small businesses are at the heart of the capital’s economy; however, they are not benefiting from the same level of support as their English counterparts. The Scottish National Party Government’s refusal to replicate the United Kingdom Government’s business rates relief means that the average pub in Scotland is now paying £15,000 more than pubs in the rest of the UK. Further, that is replicated across various sectors in the economy—not just hospitality.

What analysis has the Scottish Government carried out to compare and contrast the impact of its decision to lay that additional burden on our small businesses? We should remember that those businesses are key to providing local jobs and employment opportunities for those who live in the city.

Tom Arthur

I join Sue Webber in recognising the importance of our small and medium-sized enterprises, which are the backbone of the economy not just in Edinburgh but across Scotland.

I will not rehearse the arguments that have been well aired in the chamber with regard to the decision on retail, hospitality and leisure rates relief. As Sue Webber will recall, to enable that relief to take place, we would have had to commit hundreds of millions of pounds from other vital public services, and that was a decision that we were simply not prepared to take.

Of course, we continue to invest significantly in the small business bonus scheme, which is estimated at a cost of £685 million this year and from which many small businesses, including those in the hospitality sector, benefit. [Tom Arthur has corrected this contribution. See end of report.]

The Government is committed to continued engagement with the hospitality sector and wider businesses, which are liable for non-domestic rates. Indeed, my colleague, Ivan McKee, as Minister for Public Finance, in conjunction with the Cabinet Secretary for Finance and Local Government, will continue to take forward the work on non-domestic rates, as part of the new deal for business group.

Foysol Choudhury (Lothian) (Lab)

Employability schemes can be a key factor in people joining the workforce or for parents rejoining it after having a child. Despite that, the Scottish Government cancelled £53 million for employability schemes and scrapped the parental transition fund.

Will the minister advise how the Government will make up for the shortfall in funding for employability schemes? What other measures is the Scottish Government taking to get people into employment in Edinburgh?

Tom Arthur

As I set out in my original answer, we are providing £90 million of support for devolved employability schemes in this financial year and we continue to work with partners to ensure effective delivery, but we recognise that delivery best takes place locally on the ground, to ensure a joined-up, holistic and person-centred approach.

I have recently come into this post, and I am looking forward to engagement with local employability partnerships and other stakeholders across the summer.

In that spirit, if there are any particular areas on which Foysol Choudhury would like me to engage with him directly, I am more than happy to do that.

Gordon MacDonald has a brief supplementary question.

Employment in Edinburgh is at 82 per cent and has increased compared with the previous year. What steps is the Scottish Government taking to further boost Edinburgh and Scotland’s economic activity?

Please answer as briefly as possible, minister.

Tom Arthur

I have already touched on a range of measures, such as the city region deal and the significant investment that will be channelled through that.

We also have a national strategy for economic transformation. The First Minister has set out that the key, core priority of this Government is stimulating economic growth for all parts of Scotland, including our capital city.

Migration (Labour Market)

8. Colin Beattie (Midlothian North and Musselburgh) (SNP)

To ask the Scottish Government whether it has carried out any analysis of the potential impact that a policy to reduce net migration to the United Kingdom would have on its long-term labour market strategy. (S6O-03556)

The Deputy First Minister and Cabinet Secretary for Economy and Gaelic (Kate Forbes)

Current and proposed UK immigration policies fail to address Scotland’s distinct demographic and economic needs. Migrant workers are vital in addressing the decline of our working-age population, and Scottish employers are increasingly dependent on migrant workers for a growing proportion of their workforce.

The work of our independent expert advisory group on migration and population has consistently shown the economic benefits that migration brings to Scotland.

Colin Beattie

Scotland has a declining working-age population. Migration will only become more important to maintaining a thriving economy and robust public services. Given that both the Tories and Labour seem determined to slash the numbers, does the cabinet secretary share my concerns about the potential impact on Scotland’s workforce?

Kate Forbes

I share those concerns absolutely and in full, because evidence shows that migrants who choose Scotland as their home help to grow our economy, increase productivity and innovation, address skills shortages and make essential contributions to communities.

We need to be able to access skilled labour, not least at a time when unemployment is at a record low. We know that, particularly in rural areas, we face the prospect of double-digit depopulation.

As one way to mitigate those barriers, in March, we launched Scotland’s migration service, which provides vital information and advice to employers and people who have recently moved to Scotland. However, ultimately, that matter needs to be resolved at source.

The Deputy Presiding Officer

That concludes portfolio questions on Deputy First Minister responsibilities, the economy and Gaelic. There will be a brief pause before we move to the next item of business, to allow front-bench teams to change position.

Finance and Local Government

The next portfolio is finance and local government. If any member wishes to ask a supplementary question, they should press their request-to-speak button during the relevant question.

Local Authorities (Budget)

To ask the Scottish Government what discussions it has had with local authorities regarding any further allocation from its budget, including for house building. (S6O-03557)

The Cabinet Secretary for Finance and Local Government (Shona Robison)

Throughout the budget process, I confirmed my intention to prioritise affordable housing if the United Kingdom spring budget delivered more consequentials. Unfortunately, the UK Government once again let Scotland down and our capital budget is expected to reduce cumulatively by more than £1.3 billion by 2027-28.

Despite that, in April, we announced an additional £80 million investment over two years for the acquisition of properties to be brought into use for affordable housing to help to reduce homelessness. We will shortly be discussing the allocation of the additional £40 million for 2024-25 with the Convention of Scottish Local Authorities, which brings this Government’s investment towards the delivery of affordable homes to nearly £600 million in 2024-25.

Foysol Choudhury

In May, the City of Edinburgh Council said that it would not be able to deliver more Government grant-funded affordable homes due to cuts to the affordable housing supply programme, which has meant that the council housing budget is 24 per cent smaller. Now that the Scottish Government has heeded Labour’s call to declare a housing emergency, does the cabinet secretary agree that that should be met with action, including the restoration of that money to local authorities to build affordable housing?

Shona Robison

We have a good track record, having led the UK by delivering more than 128,000 affordable homes since 2007, with more than 90,000 for social rent. That is higher than anywhere else in these islands.

We acknowledge that these are exceptionally challenging times. That is why we agree that there is a national housing emergency, and why we continue to call on the UK Government to reverse the almost 9 per cent cut to Scotland’s capital budget. If there is a cut to the capital budget and a 60-plus per cent cut to financial transactions, which underpin the affordable housing supply programme, that will have an impact.

In the autumn budget that will follow the general election, we need a reversal of that capital cut and a restoration of financial transaction funding.

There are a number of supplementaries. I will try to get them all in, but they will need to be brief, as will the responses.

Ben Macpherson (Edinburgh Northern and Leith) (SNP)

In the context of the real-terms cut to the Scottish Government’s capital budget and its impressive record of affordable house building—with more being built per head of population than elsewhere in the UK—on the £600 million that has been allocated this financial year, a prioritisation for Edinburgh would make a big difference, especially in Granton, in my constituency, where the local authority has been able to purchase land. I would be grateful for the cabinet secretary’s continued engagement in the realisation of the potential for building affordable housing in Granton.

Shona Robison

As I said to Mr Choudhury, officials are working to consider the allocation of the £40 million this year. Local authorities will direct the affordable housing supply programme investment to the priorities that they have identified in their strategic housing investment plans. We know that, in 2023-24, £7.5 million from the affordable housing supply programme was invested in Granton to support the eventual delivery of more than 400 affordable homes. That is absolutely a priority project for the city of Edinburgh, which we want to support.

Something else that would help local government with housing would be for the Scottish Government to meet its promise to have multiyear funding in budgets. Are we any closer to getting that?

Shona Robison

If the Scottish Government got multiyear funding in our budgets, we would be able to agree multiyear funding settlements for local government, the third sector and others. However, that is very difficult when we have had only single-year budgets set, because we do not have the certainty to provide a multiyear funding settlement. We will take that up with the UK Government post the general election.

Beatrice Wishart (Shetland Islands) (LD)

When considering funding for house building, in addition to engaging with local authorities, what engagement does the Scottish Government have with renewable community benefit and business organisations such as Salmon Scotland that express interest in investing in housing in rural areas?

Shona Robison

It is important that we look at all the options available to us, which is why the Minister for Housing has convened the housing investment task force. We need to look beyond traditional capital, particularly if the capital cut is not restored. We are keen to look at all vehicles that we can use, working with organisations such as the one that Beatrice Wishart mentioned and other housing stakeholders to lever in as much housing investment as possible.

Councillor Remuneration

To ask the Scottish Government when councillors’ pay is expected to rise. (S6O-03558)

The Cabinet Secretary for Finance and Local Government (Shona Robison)

Councillors received an uplift of 6.2 per cent in April 2024, in line with the 2017 agreement with the Convention of Scottish Local Authorities to annually uprate councillor remuneration. Scottish ministers are considering the recommendations that are contained in the report that the Scottish local authorities remuneration committee published earlier this year and will respond to that in due course.

John Mason

MPs are paid £91,000 a year, we are paid £72,000 a year and councillors get something like £21,000 a year. That seems a bit out of line. Councillors whom I know work just as hard as most MSPs, put in the hours and make major decisions. Does the cabinet secretary agree that there is a bit of an inconsistency there?

Shona Robison

I recognise John Mason’s point that councillors play a vital role in local communities and decision making across local authorities. I am grateful for all their contributions.

I am currently considering SLARC’s report in which it sets out its recommended remuneration rates for councillors, which reflect changing roles and responsibilities. It is important that there is due diligence and due consideration is given to the report. As I said, we will publish our response in due course. However, we want to ensure that we make being a councillor an attractive proposition, not just for current councillors but for future generations of councillors.

Pam Gosal (West Scotland) (Con)

On the question of women’s representation in councils, Councillor Shona Morrison, who is the president of COSLA, said:

“it always comes down to remuneration. That is the biggest barrier.”—[Official Report, Local Government, Housing and Planning Committee, 28 May 2024; c 38.]

Does the cabinet secretary agree with that assessment? What more is the Scottish Government doing to increase female representation in councils?

Shona Robison

I agree with Pam Gosal that remuneration is part of the picture when it comes to attracting more women into politics generally, whether that is in local government, in the Scottish Parliament or elsewhere.

However, culture also has a role to play. I know that many women whom I have tried to encourage to stand look at our political environment and are put off by it. We all have a job to do to encourage more women into politics at whatever level.

Public Sector Pay Policy

To ask the Scottish Government how its recently published public sector pay policy will support public sector workers to cope with the cost of living. (S6O-03559)

Shona Robison

The Scottish Government’s public sector pay policy for 2024-25 sets out a multiyear framework that offers pay metrics that are above the current forecast levels of inflation. We are continuing our commitment to pay at least the real living wage and are maintaining our progressive approach to pay awards.

As a result of those policies, public sector staff in Scotland are paid 6 per cent more on average than those in the rest of the United Kingdom, which demonstrates our support for workers through the cost of living crisis, despite the tight fiscal position that we face.

Maggie Chapman

The results from the equality impact assessment of last year’s public sector pay policy are clear. The assessment states that

“pay proposals”


“be progressive and protect lower paid staff.”

There is higher representation of women, disabled people, those from a minority ethnic group and those from the younger age group among lower earners. Will the cabinet secretary consider recommending in future pay policies specific measures such as set pay ratios and targeted benefits to support on-going work to reduce the gender pay gap and overall income inequality and therefore better support people to cope with current and future economic crises?

Shona Robison

Public bodies have the flexibility to draw up their own pay proposals within the policy, but they are encouraged to consider a progressive pay approach, which might include setting a cash underpin, a higher percentage uplift or a non-consolidated cash payment. The matters that Maggie Chapman raises are important, and we encourage support for the lower paid within the public sector pay policy.

Visitor Levy (Local Authority Revenue)

4. Rachael Hamilton (Ettrick, Roxburgh and Berwickshire) (Con)

To ask the Scottish Government, regarding any implications for its budget and public sector finances, what assessment the finance secretary has made of how much revenue the visitor levy could generate for local authorities. (S6O-03560)

The Cabinet Secretary for Finance and Local Government (Shona Robison)

As a visitor levy is a local tax, the level of revenue that it raises will depend, first, on whether a local authority decides to introduce a visitor levy and, secondly, on what percentage rate the local authority sets.

In the business and regulatory impact assessment that accompanied the Visitor Levy (Scotland) Bill, the Scottish Government analysed a range of visitor levy percentage rates and what would be raised with them. As just one example, analysis indicates that if every local authority in Scotland were to introduce a visitor levy at 2 per cent, that would raise around £33.7 million.

Rachael Hamilton

Some local authorities have, justifiably, chosen not to implement a visitor levy, due to the administrative costs that they would incur versus the income that they would generate. Can the cabinet secretary confirm whether the Scottish Government has considered what would be the likely impact on a local council’s future funding settlement if it chose not to implement the visitor levy, in order to protect its financial situation?

Shona Robison

As I said at the start of my answer, as it is a local tax, the level of revenue from the levy will depend, first, on whether a local authority decides to introduce a visitor levy. There is no requirement on local authorities to do so. The bill is about our empowerment of local government with a range of fiscal levers, which I would have thought Rachael Hamilton would welcome.

If a local authority decides that it wishes to proceed with a levy, it is for that authority to decide the rate, and it has to carry out the assessment and consultation with local businesses and other stakeholders before proceeding, as is set out in the bill. Any revenue that is raised by the council through the levy will not impact on any of the local government funding that it otherwise receives—it will be additional revenue. I would have thought that Rachael Hamilton would welcome that, too.

Fife Council (Bellwin Scheme)

To ask the Scottish Government whether Fife Council will be given assistance under the Bellwin scheme. (S6O-03561)

The Cabinet Secretary for Finance and Local Government (Shona Robison)

The Bellwin scheme allows Scottish ministers to make revenue support available to councils to assist with immediate and unforeseen costs in the aftermath of emergencies that exceed a council’s annual Bellwin threshold. The key criteria of the scheme are that the assistance will

“safeguard life and property, and prevent suffering or severe inconvenience”.

In 2023-24, Fife Council did not submit a claim under the Bellwin scheme. However, discussions are on-going with Fife Council to explore alternative forms of support, including delivery of targeted support for residents and businesses in Cupar, which was badly affected by storm Gerrit.

Claire Baker

As the cabinet secretary has recognised, there have been significant problems in Cupar, and across my region there have been a number of significant flooding events. Although local flood grants are available, the pressures on local authorities to manage the impacts of flooding and coastal erosion are increasing.

As the cabinet secretary recognised, Fife Council has recently contacted the Scottish Government and the United Kingdom Government to request an audit of the Bellwin scheme and to seek more financial support for weather events beyond those that are classified as amber.

Will the cabinet secretary say a wee bit more about how the Scottish Government will respond to that request, whether she thinks that there is potential to extend the criteria of the Bellwin scheme, and how we can all ensure that local authorities are better supported to meet the financial costs of flooding impacts in our communities?

Shona Robison

I am happy to write to Claire Baker with some detail on that. She knows that the Bellwin scheme goes back to about 2005. We are keen to discuss with local government the arrangements going forward. We have agreed a number of recommendations from the work of the Scottish Government and Convention of Scottish Local Authorities flood risk management working group, which was formed in order to look at improving some of the schemes and how they work.

However, I am absolutely open to looking at whether further reform is required. Of course, we have put a great deal of investment into flood-risk management, and we will continue to do that and to support communities that are adversely affected.

I am happy to write to Claire Baker with further detail on support for Fife and the on-going discussions on that.

Elgin Procurator Fiscal’s Office (Refurbishment Cost)

6. Fergus Ewing (Inverness and Nairn) (SNP)

To ask the Scottish Government, regarding the application of the principles in the Scottish public finance manual, what its position is on whether the reported estimated cost of £3.56 million—that is £3,560,000—for refurbishment to decarbonise the procurator fiscal’s office in Elgin represents value for money, in light of the property being valued at just £275,000 in March 2022. (S6O-03562)

The Minister for Public Finance (Ivan McKee)

The Scottish Government takes getting best value for money from public spend seriously, and we recognise the need to meet our climate commitments. That includes spending the limited public money available for that purpose most effectively to achieve our targets.

Fergus Ewing has raised valid concerns about the value-for-money aspects of that particular investment: I have to say that I share those concerns very much. The project was intended to increase understanding of the technology and processes around deep retrofitting of historic buildings. As such, it will not be replicated, but the lessons that have been learned should support cost-effective delivery of future projects. The member can rest assured that any future projects will be rigorously assessed to ensure that public money is used most effectively to deliver the Government’s objectives, taking into account strict value-for-money criteria.

Fergus Ewing

I have long believed that the household implement of which the Scottish Government was in most dire need was a new broom. From what I have heard, I am pleased that we appear to have found, in the minister, that new broom and can secure value for money and avoid waste of money in investment in our public buildings in general.

With regard to new projects, can the minister use that new broom to prevent further waste of money on a gigantic white elephant of a project of eye-watering proportions to build a new office for Scottish Government staff in Glasgow when, frankly, huge numbers of empty public buildings are already available for its use?

Ivan McKee

Fergus Ewing has raised a very important point. He will be delighted to hear that the project that he has highlighted is under scrutiny at the moment. He will be well aware, as I am, that there is unused capacity in Scottish Government and agency premises in Glasgow. Any proposals for new capacity would need to be viewed in the light of whether that capacity is required and the requirement to meet the very strict value-for-money criteria that I have outlined.

Non-domestic Rates Relief (Ayrshire)

7. Sharon Dowey (South Scotland) (Con)

To ask the Scottish Government what assessment it has made of the potential impact that replicating the non-domestic rates relief available to businesses in England would have in Ayrshire, including in relation to job creation. (S6O-03563)

The Minister for Public Finance (Ivan McKee)

The Scottish Government has a long-standing commitment to delivering a competitive rates regime that supports businesses and communities, including in employment. The Scottish budget delivers a non-domestic rates relief package, which is worth an estimated £685 million in 2024-25 and includes a number of reliefs that are not available elsewhere in the UK, as well as up to 100 per cent relief for hospitality businesses on islands including Arran and Cumbrae in the member’s constituency.

Due to the generous small business bonus scheme and other reliefs, we estimate that, as at 1 July 2023, more than half of properties in Ayrshire do not pay any rates at all. Although the Scottish ministers are sympathetic to calls to replicate the rates relief that is available in England in the retail, hospitality and leisure sectors, doing so would have meant that the Scottish Government could not provide the national health service, schools or emergency services with the funding that they require.

Sharon Dowey

In the year ending December 2023, across Scotland 74.7 per cent of people aged from 16 to 64 were employed. However, in South Ayrshire, the figure was significantly lower, at just 65.2 per cent. South Ayrshire is home to fantastic businesses that have much to offer, but they face multiple challenges, including high business rates, that leave them at a disadvantage. Given that the average pub is now paying £15,000 more in tax than its counterparts in the rest of the United Kingdom, does the minister agree that that money could have been better used by small businesses to hire more staff—in particular, young people?

Ivan McKee

If Sharon Dowey is advocating for cuts to the NHS or to the education budget, that needs to be considered as the context of the proposal, or choice, that she is advocating.

The Scottish Government works hard to support employment prospects across the country, including in Ayrshire. My economy minister colleagues do so every day. It is worth remembering that half of businesses in Ayrshire do not pay any rates at all. In Scotland, 95 per cent of non-domestic properties continue to be liable for lower property tax rates than properties elsewhere in the United Kingdom. A number of reliefs are available in Scotland that are not available in England, including day nursery relief, fresh start relief, hydro relief and others. Half of properties in the retail, hospitality and leisure sectors are eligible for 100 per cent relief in Scotland in the current financial year.

Gordon MacDonald (Edinburgh Pentlands) (SNP)

Thanks to the Scottish Government’s budget decisions, businesses across Scotland continue to benefit from the most generous small business bonus scheme in the UK. Can the minister provide any update on the Scottish Government’s assessment of the number of businesses that the scheme supports?

Ivan McKee

Information from the last snapshot date, which was 1 July 2023, showed that more than 114,000 properties had been taken out of paying rates altogether as a result of the Scottish Government’s policies, with at least 98,000 of them having benefited in some form from the small business bonus, which, as Gordon MacDonald acknowledges, is the most generous scheme of its type in the UK.

The Deputy Presiding Officer

I am unable to call question 8 because Mr Golden is not in the chamber. I have not received an explanation for that. I will expect one, along with an apology.

With that, portfolio question time is concluded. There will be a brief pause before we move to the next item of business, to allow front-bench members to change places.