A Budget for Scotland’s People
Good morning. The first item of business is a debate on motion S3M-7474, in the name of Johann Lamont, on a budget for Scotland’s people.
09:15
I am pleased to open the debate on behalf of the Labour Party. I recognise that it is an important debate for the people of Scotland. It is not our intention for this to be a yah-boo debate; it is not a debate for the sake of it, but one that is of significance for all Scotland.
As members might be aware, I am not an aficionado of budget debates. However, this is not simply a debate for the parties’ finance spokespeople—which is why I am opening—but one that is at the heart of Labour’s concerns and, I believe, the concerns of others about the Scottish National Party’s approach and attitude to the development of the budget and the consequences for individuals, families and communities throughout Scotland.
Our motion recognises the reality in Scotland of uncertainty, anxiety, stress and fear for what the future may bring. Our job—the purpose of the Scottish Parliament—is to protect people and to take action that offers greater stability and certainty. The evident uncertainty is corrosive; it is a threat that is not easily captured in a ledger but which fundamentally impacts on people’s lives.
Our central argument is that the Scottish Government is compounding that uncertainty. Yes—Mr Swinney is demanding efficiencies and outlining his spending priorities for the next year, but the reality is that he is preventing a wide range of public and voluntary bodies and local authorities from being able to plan and make informed choices about the future.
The Scottish Government has the information. It can help, but chooses not to by refusing to give spending projections for the period of the comprehensive spending review. When the Scottish Government is challenged about its many failures, broken promises or incompetences, it often says that it is a minority Government. That is not, in itself, the problem: the problem is that it is a minority that is incapable of seeking compromise and consensus. Instead of seeking co-operation to support people in these tough times, it acts in a way that keeps MSPs in this Parliament in the dark and, more important, which keeps in the dark crucial public bodies and organisations that are striving to deliver front-line services. It is our contention that that is a dereliction of duty and an abdication of responsibility: those are sacrificed on the altar of party interest, not in the country’s interest.
At decision time today, there will be an opportunity for the Parliament to assert itself against that minority control over the Parliament’s powers, and to confirm its disapproval of the approach and its consequences for the people whom we represent. If successful, it will be a challenge to the Scottish Government to accept accountability and to act accordingly to create more certainty and give people more protection. I expect that, if the motion is supported at decision time, the Minister for Parliamentary Business will report as a matter of urgency on how he plans to enact that decision of the Parliament.
We want the Scottish Government to take an approach that recognises the challenge not only for ministers but for all those who depend on the Government’s funding. Mr Swinney said in his budget statement that this is not a one-year problem and then revealed that he would provide only a one-year budget. That contradiction is as odd as it is unacceptable.
Why does the Labour Party want to win the election next year but operate an SNP budget? You are basically calling for us to set a budget for a four-year term of office throughout which you hope to be in power. Is that because you want to sit in office—if you win, which is unlikely—and blame the SNP for all the cuts that were imposed thanks to the incompetence of the previous United Kingdom Labour Government?
I remind members to speak through the chair, please.
That intervention was self-evidently ludicrous. We make the point—I will make it again later—that this is not about elections but about serving the people of this country.
Mr Swinney says that it is difficult in these unprecedented times to do as we suggest, but in Wales people have the information and in England people have the information. Earlier in the week, the Northern Ireland Government indicated that it would provide spending plans for 2011-12 to 2014-15 as part of its budget process. I even understand that in the Republic of Ireland—despite the system there being under terrible pressure—the Government has made it clear that any budget that it produces will provide plans for a period far beyond the next year.
In a previous debate, when Mr Swinney was being asked to produce an indicative budget ahead of the comprehensive spending review, he replied that Wales had taken the same approach as he had; that he and the Welsh finance minister were as one and had decided
“to wait until the comprehensive spending review had been undertaken”.
Mr Swinney asked Andy Kerr:
“If that approach is good enough for Welsh Labour, why is it not good enough for Scottish Labour?”—[Official Report, 4 November 2010; c 29972.]
In the same way, we might now ask: if a spending review for the comprehensive spending review period is good enough for England, for Wales and for Northern Ireland, why is it not good enough for Scotland? Why, uniquely, are we incapable of doing it? What is unique about our civil servants that renders them incapable of identifying options for spend beyond the next year?
Is Mr Swinney really saying that no work has been done, or is being done, to prepare spending plans? If the work has been done, why could it not be done as part of the budget process? Were civil servants instructed not to do the work? If they are doing that work, why is it not being harnessed to create certainty for all those who seek to meet need in our communities?
The truth is that Mr Swinney has that information; he just does not want to share it. “But”, says Mr Swinney, “we can’t because there are big issues here. We have asked Campbell Christie and his commission to look at them and we can’t give details until Parliament has had the opportunity to consider the commission’s proposals.” We might say that there is evidently no rush, but Mr Swinney is asking us to set aside the fact that the logic of that position, given the breadth and depth of the commission’s remit, is that no decisions could be taken on anything. At the same time, Mr Swinney has blithely ruled out much of the independent budget review and has made significant spending commitments at his party conference.
To accept Mr Swinney’s position, one must also disregard the fact that the commission has been told by the Scottish Government that its purpose is long term and that, in an earlier debate, Mr Swinney said that that purpose would allow
“the focusing of medium-term financial priorities.”—[Official Report, 4 November 2010; c 29976.]
We all know, however, that the reality is that Mr Swinney is now using the commission as a short-term alibi to get him through the winter and into election time. [Interruption.]
Order.
I call in evidence someone whom I would not necessarily happily quote. In an interview in Holyrood magazine of 18 October, Alex Salmond argued that what is happening in Westminster in relation to cuts is about election timetables. He reflected that
“electoral, political and economic cycles don’t always fall in the same way and politicians should have a higher duty and the duty is more to the economic cycle than the political cycle.”
Mr Salmond clearly needs to have some firm words with Mr Swinney and himself.
I recognise many of those who have agreed to serve on the commission and the qualities that they bring, but the slightest glance at its remit, which embraces not only delivery of services, but improvement of services and tackling of inequality and its causes—among a host of other things—makes it clear that its purpose is not just about rationalising the landscape in tough times in order to inform immediate spending decisions. It is about far more. So substantial is its work that it is entirely illogical to call it in aid against publishing spending plans and giving people the information that they need to plan.
I am sure that the commission will make interesting recommendations, but its remit is, in my view, so substantial that it is, in fact, one of the central purposes of Government. We have to ask what Mr Swinney and his colleagues have been doing for the last number of years. Why did they not notice that challenging times were ahead and act then by harnessing the talents within government, in the Parliament and throughout Scotland to prepare, rather than cobbling a commission together now, with a glorious remit and short timescale, which reflects not on the commission members but on the motives of those who have set it up and on the short-termism of the Scottish Government?
Mr Swinney may try to dismiss the issue at the centre of our motion as being some kind of academic issue about budget processes, and as being of interest only to the pointy heads. It is not, however, academic or obscure; it is not just for the number crunchers. Budgets are living documents. They are the expression of priorities and, in their delivery, they give shape and direction to the society we wish to live in and they shape people’s life chances. In the tough times, these choices are ever more critical.
Local authorities, health boards, voluntary organisations and police boards, which are all on the front line, want and deserve some certainty and the ability to plan. They want that not for the sake of it but because they care deeply about their health provision, their care services, their responsibility for people with learning disabilities, their ability to create economic opportunities and their creation of sustainable communities.
The Convention of Scottish Local Authorities, the Cabinet Secretary for Education and Lifelong Learning, Strathclyde police authority, the Scottish Council for Voluntary Organisations, the Scottish Federation of Housing Associations, the Confederation of British Industry Scotland, Consumer Focus Scotland and a range of other organisations have all asked for the certainty of a spending review. When they ask for that certainty, are they all wrong?
My colleagues will focus on the impact of the budget in more detail, but it is self-evidently contradictory to demand efficiencies without a timescale in which to make those demands realistic and achievable. I predict that, instead of demonstrating increased rationality in their decisions, organisations will become risk averse and perhaps cut services that might otherwise have survived, thereby creating the worst kind of short-termism.
In its written evidence to the Local Government and Communities Committee, COSLA said:
“This puts Scottish Local Government at a disadvantage compared with other parts of the UK ... Had we been able to see the resources over a longer time frame this would enable Local Government to plan more effectively and perhaps avoid cuts which may hurt our communities unnecessarily.”
That is the charge. Not only is it displaying short-termism, but the Government is creating a situation in which people are making cuts that may be unnecessary.
Johann Lamont cited several organisations that support a three or four-year budget. If she gives such weight to external bodies, why did the Labour Party give such little weight to all the external bodies that wanted minimum pricing?
This is a serious debate about the Government’s choices. The historic concordat suggested that the SNP listened to local government. The charge is very serious.
Who pays? I will give just one example: the care worker who is waiting to find out whether they have a job as the result of a commissioning agreement, while the voluntary organisation that has made a bid waits for the decision of local government, which is waiting for the Scottish Government’s decision. What is the impact on that individual worker and his or her capacity to deliver the service? They do no know whether they will have a job or should look for another. It is demoralising and reduces the local capacity to be efficient. For some, it is much worse.
I understand that Employers in Voluntary Housing, with the help of the Scottish Housing Regulator, has issued guidance for housing associations and co-operatives about the challenge of the current economic situation. Banks are reported to be eagerly seeking to review deals for risk, and will possibly increase costs and charges, while the housing association grant has already been cut, increased and then cut again and is unpredictable. In such circumstances, the lack of information for future planning may have a devastating effect by undermining the sector's capacity to thrive and deliver economic opportunity. The call for the sector to be more efficient is entirely undermined by the Scottish Government’s approach, which hampers housing associations’ attempts to do what they do best—planning, preparing, delivering and maintaining.
The Government’s approach to the budget disregards the needs of local people and is symptomatic of the SNP’s overall approach, which is that it is cynical, self-serving and incapable of separating the country’s interests from the party interest. If Mr Swinney is to be worthy of his office, he should use the powers that he has to help people throughout Scotland. At the very least, he should stop being a hindrance to those who want to make a difference to individuals and their families. In refusing the spending review, he is not taking a technical step but making an active choice. Mr Swinney lacks the political will do what his office demands, and his purpose is to serve his party, not his country, and to put his own interests ahead of the future of people in our communities. That is his narrow, SNP party-political choice, but—
Members: Oh!
Order.
The consequences of that choice will be felt by those who are weakest in defending themselves—the people who seek jobs and who rely on services. [Interruption.]
Order.
I ask members to support the motion. The people of Scotland deserve better.
I move,
That the Parliament notes that the Scottish Government has been presented with its spending budgets for the four-year spending review period yet has chosen to provide local authorities, NHS boards, universities, colleges, the voluntary sector and the wider public sector with only one-year budget proposals for 2011-12; believes that such uncertainty is corrosive as it does not allow those organisations to plan effectively; believes that this inability to plan will have an adverse impact on services, individuals, families and communities, and calls on the Scottish Government to follow the example of the Welsh Assembly Government and the Scottish Parliamentary Corporate Body and publish indicative figures until at least 2013-14, in addition to its planned one-year budget for 2011-12.
09:29
I associate myself with some of the remarks that Johann Lamont made about the anxiety and uncertainty that people feel because we are going into a climate in which public spending in Scotland will take a fundamentally different course to the one that it has taken over the past 10 years. I understand that that causes uncertainty and anxiety for members of the public, whether they are public sector employees who face the pay restraint that I set out in my budget statement last week, or members of the public who are dependent on public services and rely on them to support their families, education or health care. I accept that uncertainty because the nature and character of public expenditure in the period ahead will change fundamentally.
Last week, I fulfilled my responsibility to Parliament by publishing a draft budget that addressed the sharpest reduction in public expenditure that any finance minister in the Scottish Executive or the Scottish Government—or, in fact, any minister in the former Scottish Office in almost the whole post-war period—has faced. The Labour Party was foremost in demanding that I publish that budget statement. I made my choices and published them. I will debate, discuss and defend them in the Parliament and its committees in the period ahead.
I will also do what I have done for the past three years. This is where one of Johann Lamont’s remarks was entirely wide of the mark: she accused the Government of being a minority that is unable to compromise. I am sorry—
It’s true.
We hear the mutter, “It’s true.” If it were true, the Government would not have compromised with the Conservatives, the Greens, the Liberals and the Labour Party on the contents of different parts of its budget provisions in the past three years. We would not have delivered the home insulation scheme that Patrick Harvie has piloted, the timescale on the small business bonus for which Derek Brownlee and Gavin Brown pressed or the college places for which Jeremy Purvis and his colleagues pressed. We would also not have had the capacity to deliver the apprenticeships for which David Whitton and Andy Kerr pressed.
That is an illustration of how the Government has responded to the challenge of compromise. However, the starting point of that debate must be to publish a draft budget, which is what I have done. I have fulfilled that duty. It is interesting that, in Johann Lamont’s 14-minute speech, there was not one scintilla of a suggestion about how I should have done things in any way differently in that budget.
With respect, you are in government and you have an obligation to meet the needs—
Speak through the chair, please.
The minister has an obligation to meet the needs of the people of Scotland. Will he, in a spirit of compromise and consensus, confirm that if the motion is agreed to at 5 o’clock, he will produce the spending plans for which we have called?
I gave Johann Lamont another invitation to set out some of the Labour Party’s alternative thinking on the sharpest reductions in public expenditure that any Government has faced but, once again, she was unable to offer a scintilla of a suggestion for alternative choices that we should make in the budget. That is the fundamental part of the debate that we will have to confront.
The cabinet secretary outlined the budget areas on which the Government has compromised. If all three Opposition parties in the Parliament believe that the Government should publish more than simply one year’s figures, will it act on that view?
The Government will always reflect on the outcomes of parliamentary debates, so that is a question that we will consider in the light of today’s discussions. I say respectfully to Mr Purvis that the Government has done what the parliamentary process requires it to do—which is to propose a draft budget—because the Parliament only ever discusses and debates one year’s budget provisions.
Johann Lamont criticised the Government for setting out only one year’s financial information. Of course, in 2006, the United Kingdom Government delayed the spending review that was required to provide longer-term financial planning, so we ended up with only one-year budget figures for 2007-08. In March 2010, the Chancellor of the Exchequer—again, a Labour chancellor—published only one-year budget figures. If it was good enough for the Labour Party at that stage, it should be good enough for it at this stage.
One piece of certainty that the Government has given to the public sector across Scotland is one that has run through all our actions since the spending review in 2007, which is the fundamental shift in policy focus and attention to the achievement of outcomes in the public sector. What are we achieving for the money that we are spending? We have said clearly to the public sector that the Government’s focus on outcomes will not change. The fact that it will be a permanent feature of future Government spending plans is enshrined in the spending plans document that I have published. That gives confidence, through many of the social policy frameworks and the approaches that we take on early intervention and other issues, that will assist long-term planning in the public sector.
The cabinet secretary and his colleague the Cabinet Secretary for Health and Wellbeing can provide certainty in the areas for which they are responsible by saying that there will be no compulsory redundancies in the health service or among workers who are employed directly by the Scottish Government. What certainty can he give to local government workers who do not have such an assurance?
In last week’s budget statement, I made it clear that the Government has been engaged in discussions with the trade unions on how we can create a framework that gives a guarantee of no compulsory redundancies—
What about local authorities?
If Mr McNeil will allow me to finish, I will address his point directly.
We will create a framework that gives an assurance on compulsory redundancies to public sector workers in areas that are under the direct control of ministers in a fashion that delivers flexibilities to protect employment levels.
We also said in the spending review that we would work to engage all other players in the public sector—principally, local government—in the same framework. I give Mr McNeil the commitment that I will pursue that approach. I have agreed to do that with the president of COSLA and the general secretary of the Scottish Trades Union Congress, and that commitment will be a hallmark of the discussions that the Government holds. We believe that the idea of offering an assurance on compulsory redundancies provides greater certainty in the economy and in the workforce, and a greater ability to achieve the public sector transformation that we are looking for.
In your response—
Through the chair, please.
My apologies, Presiding Officer.
The cabinet secretary said that he had discussions with COSLA regarding compulsory redundancy, but it was made clear to the Local Government and Communities Committee yesterday that individual local authorities will take decisions on that. Has he had discussions with the leaders of individual local authorities?
It is pretty clear that COSLA is what it says on the tin—it is the umbrella body for Scottish local authorities. [Interruption.]
Order.
I have regular dialogue with the leadership of COSLA. For example, I attended the COSLA leaders meeting—a meeting of the leaders of all Scottish local authorities—in East Renfrewshire back in June to share some of our thinking on the spending review. I see local authority leaders all the time, but the discussion must be focused through the umbrella body, COSLA, which acts on behalf of local authorities. We have had a series of highly engaged discussions over time.
The Government has published a one-year budget, has set out its long-term thinking as regards the policy focus on outcomes and has established the Christie commission to explore some of the issues to do with the fundamental reform that must be undertaken in the public sector if we are to live within the spending environment in the period ahead. That is necessary, because if we simply proceed on the basis that budget numbers can be set out in the fashion in which they have traditionally been set out, and that public services can continue to be delivered in the way in which they have always been delivered, that misses the harsh reality of the financial climate that we face.
One reason for my reluctance to set out long-term numbers is that I accept unreservedly that those numbers would have to change—I defy anyone to say that they would remain unchanged in the period ahead. With fundamental reform of the public services, those numbers would have to be varied and amended. If we were to provide such figures, we would not give certainty—
Will the cabinet secretary give way?
I am afraid that we do not have time.
I apologise to Mr Harvie.
We cannot provide such certainty, because we know that there is to be reform.
Let me turn, for a moment, to the inquiry on preventative spending that the Finance Committee is undertaking and to which I will give evidence on Tuesday. It confronts the fundamental issue that we in the public sector must address—the shift in spending from treating the symptoms of particular social and economic difficulties to spending on addressing the causes. That is why the change fund that the Deputy First Minister has agreed with local authorities, which will be put in place to revise the care model in Scotland, is such an innovative model for the delivery of public service reform. That is the correct way for us to proceed in what is an extremely difficult environment.
I reiterate the point that this Government and this finance secretary have confronted the sharpest reduction in public spending that Scotland has ever faced. We have published our budget, and I look forward to hearing the other parties’ input to the substance of that debate.
I move amendment S3M-7474.3, to leave out from first “Scottish Government” to end and insert:
“Scottish Parliament is always asked to approve a budget for one financial year; acknowledges that £3.3 billion of cuts in Scotland’s budget imposed by the UK Government in the Comprehensive Spending Review, with the largest cuts due to fall in 2011-12, means that radical reform of public services will be needed; welcomes the Scottish Government’s work in setting out clear priorities for long-term success in the Scottish economy and the announcement of a £2.5 billion programme of infrastructure investment to be delivered through the non-profit distributing model; further notes the work of the Christie Commission that will inform public service delivery in the years to come, and calls for the Parliament to be given the opportunity to fully consider those proposals before setting further detailed spending plans.”
09:41
Some weeks ago, when the First Minister confirmed that we would get only one year’s figures in the budget, we said that we need a longer-term approach to budget making. The Conservatives did not support the other Opposition parties when they asked for a Scottish budget to be published before the comprehensive spending review at UK level, but now that the figures are clear, there is no excuse for the Scottish Government’s failure to do what the UK Government has done, which is to set out where funding should be prioritised in the years ahead.
The failure of the SNP to do that is not just a failure of leadership but an abdication of responsibility. Although that is the SNP’s problem rather than mine, it is also politically inept because Labour is now off the hook. No Labour spokesman will have to answer in any detail on what Labour would do in the next session if it won the election. The SNP’s failure to produce longer-term figures means that we will have an election that is about generalities when the public is surely entitled to a choice on the specifics.
I will give some examples of why we need longer-term budgets and I will mention some of the issues that have been thrown up by the Scottish Government’s one-year budget. I looked very closely at the page on Scottish Water on the day the budget was published and I thought that the cabinet secretary was being extremely clever on the politics of the matter. The Scottish Government has removed all funding support for Scottish Water for 2011-12. We do not know whether it is feasible to do that for future years—unless, of course, the Government or its successor does what we have suggested since 2003 and removes Scottish Water from public control. Longer-term indicative figures would tell us whether the removal of funding support was a one-year political stunt or a more sustainable approach in the medium term. We all know the answer, but longer-term figures would confirm it.
Back-bench SNP members must be cursing the cabinet secretary for suppressing future budget lines that would demonstrate the astonishingly large sum of money that the Government is relying on flowing to the taxpayer when Scottish Water starts generating power, once the Government has become sufficiently ambitious to introduce its water bill.
We are told that universities can have their funding cut and maintain student numbers, but even if they can do that for one year, can they do it for longer, or will even this Government—if it is re-elected—have to face up to difficult decisions on higher education funding? Have we not been given figures for future years because funding for universities will fall still further, to suppress the detail of any income from fees that the Government might decide to introduce after the election, or simply to hide the fact that the Cabinet Secretary for Education and Lifelong Learning has absolutely no idea what to do and no semblance of a long-term plan?
Does the member agree with his colleagues in Westminster that student fees in Scotland should be up to £9,000 per year?
Colleagues in Westminster indicated plans for England. We published our suggestions for Scotland before the Browne review reported and before the UK Government published its plans. We have always been clear that if we want to maintain the quality of Scottish universities, their competitiveness and student numbers, there has to be a graduate contribution. We have set out our plans. The Government is free to disagree with them, but it would be much more convincing if it had ideas of its own.
I turn to another major public service—the national health service. We know that NHS spending for next year has been protected. Will that be maintained for future years? Will the NHS get real-terms protection for the duration of the next parliamentary session? Can that be done? We do not know.
Last week, I challenged Jackie Baillie on leading her Labour group to vote for the free prescriptions policy when she, by her own admission, does not know whether the policy is sustainable. Leaving aside the fact that the Labour Party is quite happy to vote for policies that it does not know are sustainable, the Cabinet Secretary for Health and Wellbeing later assured us:
“If the SNP is re-elected next year ... the policy will be fully funded for the future”.—[Official Report, 18 November 2010; c 30601.]
It is, of course, perfectly possible to fund a policy that costs less than £100 million from a budget of more than £11 billion, but if we do not know whether that budget is rising, falling or flat, and until we know what other decisions are projected, we do not know whether the price of free prescriptions will be hospital closures, job losses, the downgrading of existing services or whatever.
I turn to local government. Last week, in relation to the budget, the president of COSLA said:
“Nobody is saying it is brilliant”.
He obviously was not listening to the SNP back benches. However, he also said that
“Given the government’s priorities on Health”
—which is to protect the health budget in real terms—
“this is the best deal we could negotiate for Scottish local government.”
He expressed disappointment that it was merely a one-year deal, but he went on to say that
“COSLA’s main objective was to retain our share of the public sector cake, which we have done.”
So, if the SNP is re-elected, will local government retain its share of the public sector cake? We know that the SNP wants another council tax freeze for 2012-13, but we do not know what the Government intends to do about the 80 per cent of funding that does not come from the council tax. Will the SNP cut funding to local government, thus forcing schools to close and teachers to be made redundant? We do not know. We have no idea.
As the cabinet secretary said, Parliament votes on one-year budgets. I accept that, and no one is suggesting that that should change. We and the other Opposition parties are suggesting that every part of the public sector requires an indication of the longer-term view. Our amendment suggests that there should be a legislative change to prevent a future Government from doing what the current Scottish Government has done.
The SNP says that indicative figures are irrelevant because there might be a change of Government, but as I said yesterday, Governments do not fall only as a result of elections. The Scottish Government, which published a three-year spending review in November 2007 within four weeks of receiving the figures, could have fallen at any time during this parliamentary session.
The SNP makes the alternative argument that indicative figures could change, and because of such possible change, no certainty can be provided. However, the spending reductions in Wales and Northern Ireland are deeper than those that are projected for Scotland, but that does not seem to be an issue for those devolved Administrations. Indeed, the reduction in capital spending in Scotland is much deeper than that which is projected for revenue, and the Government is quite content to announce new capital plans that will clearly last longer than one year.
Surely it is better to know what the governing party plans to do in the medium term than it is not to know what any party plans to do. The cabinet secretary said that, because the UK Labour Party did not produce a spending review in 2006 and 2010, there was no need for him to do so. Surely the cabinet secretary should be aspiring to a rather higher standard than that of Alistair Darling and Gordon Brown?
I move amendment S3M-7474.1, to insert at end:
“, and believes that the Public Finance and Accountability (Scotland) Act 2000 should be amended to place a duty on the Scottish Government to produce in each UK spending review year such indicative annual figures for the whole period for which the UK Government has set out totals for the Scottish Government.”
09:48
There is a cloud hanging over the debate this morning, which is not surprising because yesterday’s debate was very serious, not just for the budget or the individual issue of the Scottish variable rate, but for the Parliament. Yesterday, we debated probity, honesty and the approach of a Government to the Parliament—the approach of an Executive that was elected by the Parliament to the Parliament. The consequences of yesterday’s debate are so significant that there is a pall over all budget considerations. If the Government of the day considers that information relating to one of the Parliament’s constitutional powers does not need to be brought to the Parliament, our scrutiny of all the other information that that Government brings to the Parliament, especially in budget documentation, has to have a greater focus. That is why trust and the finance secretary’s misjudgments are issues of such significance.
In earlier debates, I have described the Government—this could well be the yah-boo element—as a minority Government with a majority ego. We have seen that on a number of occasions during the past few years. We have also seen it over the past week, and I saw it again last night when Stewart Maxwell, a member for whom I have high regard, said that he did not think Michael Moore’s letter should have been made public and that it should have been part of the private discussions between Governments. The budget process and the budget document are among the few statutory areas in which, through our votes on legislation, Parliament can genuinely hold the Government to account and force action.
The motion that we are debating is also significant. What will the minority Government do if the motion is supported by three quarters of the members of the Parliament, across the Labour, Liberal Democrat and Conservative parties—not always the easiest coalition to put together in this Parliament? What will it do if all Opposition parties believe that it is insufficient for public services in Scotland to get figures for only one year and vote accordingly?
Will the member give way?
In a moment.
It is encouraging that the finance secretary said that he will reflect on that. That is important. I was not in Parliament during its first session, but I remember that, when Parliament voted against the Government during the second session, it was a big thing. I think that it happened twice, and on one occasion, the minister resigned.
Mr Purvis appears to be suggesting that if the motion is carried, it should somehow be binding on—
It should be.
If Mr Rumbles does not mind—more rumbling from Rumbles.
Mr Purvis is saying that that should be binding on the chamber. Johann Lamont said something very similar. Of course, technically, it would not be binding. The last time that the chamber tried to put a financially binding commitment on the Government involved the Edinburgh trams. Does Mr Purvis believe that they have been a success?
If we are talking about the technicalities of voting in the Parliament, I do not think that the Government has learned any lessons from yesterday. The people of Scotland have learned lessons; it is disappointing that the Scottish Government has not.
Why do we want the Government not just to ask a commission to provide information on delivery, but to do that itself? The Government must provide leadership. We are six months away from an election, but that is no reason for the Government to abdicate leadership and leave it to someone else.
Let us look at the detail of what the Christie commission has been asked to do. It does not have an unfettered view of all aspects of public service. In the commission’s remit, the Government says:
“It should have clear regard to work already underway”
on
health and social care and ... police and fire services”.
Nowhere in the remit does it say that the commission is going to change the Scottish Government’s view of the single outcome agreements and the national performance framework—that has been ruled out. We also know that the Government will produce a green paper on higher education. If higher education, health, social care, policing and fire services are not to come under the remit of the Christie commission, what will?
The Government said that it is impossible to produce figures for the longer term because of the changes to the budget. Let us get this right: it is not about the changes to the budget; it is about the budgets declining over the next few years. The budget document helpfully contains previous years’ figures that show that annual in-year changes in the Scottish budget have been greater than they are likely to be in the coming years; it is just that, thankfully, those changes were increases rather than decreases. Every year, the Government brings forward autumn budget revisions. If we strip out the budget revisions that are the responsibility of the UK Government, in some instances the Parliament has debated almost £1 billion of changes to the annual budget. Changes are clearly not the reason why the Government is not producing figures.
The Christie commission will not take an unfettered view, and the Government knows that budgets change over the years. What, then, is the Government’s reason? Regrettably, the reason is that the Scottish Government is not bringing forward the required strategic direction.
We indicated that we will work with the Government on Scottish Water in relation to borrowing and energy generation. We said that we need to reduce the number of quangos. We set out a programme to change the enterprise network in order to provide more support for businesses and reduce bureaucracy. We indicated that we would retain but reform concessionary travel. We said that the delivery of free school meals has been so patchy and chaotic that it needs to be looked at. We are not satisfied that simply freezing consultants’ bonuses at the current level tackles the bonus culture in the public sector or that bringing down the pay of the top civil servants, rather than pay across the whole public sector, is sufficient. We also said that we need to tackle the prescriptions budget, which is one of the swiftest growing areas of health expenditure—we brought that point to the Parliament in our debate last week.
We are willing to engage with the longer-term views, but an Opposition party requires the Government of the day to bring forward its plans, for which we hold it to account. I hope that yesterday was so significant that the Government has learned its lesson—but the initial reactions are not encouraging.
I move amendment S3M-7474.4, to leave out from “indicative” to end and insert:
“longer-term figures up to 2014-15.”
We come to the open debate. Speeches of six minutes, please. I call Jackie Baillie.
09:55
England does it, Northern Ireland does it, Wales does it and even the Republic of Ireland does it. They all publish three-year if not four-year budgets. Even the Republic of Ireland, which does not have its woes to seek—[Interruption.]
Order. If members at the back of the chamber wish to have entertaining conversations, which they appear to do, they should do so in another place.
Thank you, Presiding Officer.
Even the Republic of Ireland, which does not have its woes to seek, yesterday published its budget for the next four years. Why not Scotland? Why are we denied the same information?
We might be forgiven for thinking that the Scottish Government just does not have the financial information that we are asking for, but we would be mistaken, because it does. It knows the budget—all of it: it knows the budget for this year and the indicative budgets for next year, the year after that and the year after that. The harsh reality of the financial climate is not a reason for not publishing the information—in fact, the opposite is the case—but, for reasons best known to the SNP, we and the people of Scotland are to be denied the information.
This Parliament was established to ensure openness and transparency in the governance of Scotland. Many of us will defend those principles to the hilt, but we are faced with a Government that seems intent on doing exactly the opposite: hiding information from us and covering things by sleight of hand like some kind of magician’s conjuring trick.
People are not daft. They know that this is nothing more than a one-year election budget, designed to hide the true extent of the budget cuts that need to be made with minimal scrutiny by the Parliament and no understanding of the overall financial context for future years. We might as well be blindfolded, but perhaps that is something that the cabinet secretary wants. This is nothing more than crude SNP electoral politics. It deliberately ignores the interests of the country.
Let me tell the cabinet secretary why I believe that forward indicative budget information is so important. It enables organisations, such as councils, health boards, universities, colleges, those in the voluntary sector and many more besides, to plan ahead. I know that because I used to work in the public sector. I understand the value of forward planning. Decisions about investment or reduction are likely to be better if people know the financial context in which they are operating. The choice between ending a project completely and simply delaying implementation can be properly taken only if the decision maker understands the budget for future years.
Contrary to what the cabinet secretary claimed, without any idea of future budgets we discourage people from engaging in preventative spending. There is no incentive for them to act in the short term because they will not see results in a year. It is inherently dishonest to advocate spending on preventive measures, as the Scottish Government rightly does, and then deliver nothing to encourage that with a short-term budget. It is another disappointing example of all talk and no action.
I turn to the health budget. The SNP promised to protect health spending, but what a hollow promise that was when we consider the cuts that the SNP is already making. Some 4,000 NHS staff are out the door, 1,500 of whom are nurses. Those are cuts made entirely by the SNP—and that is before the coalition cuts start to bite.
Will the member take an intervention?
No.
The rhetoric coming from the Government benches about protecting health is not matched by the reality in hospital wards across the country.
What lies ahead? More SNP spin and more smoke and mirrors. In revenue terms, there is a real-terms reduction of £33.9 million. The cabinet secretary looks confused—
Will the member take an intervention?
I suggest that the cabinet secretary looks at table 8.02 on page 117 of the budget document.
The Scottish Government claims a 3.2 per cent increase for territorial health boards, but in reality that is a cut when we consider the rate of NHS inflation. If we look at little closer, the 3.2 per cent rapidly reduces to a 1.8 per cent increase because the Government has added in new burdens. It has cynically transferred the forward projection for the cost of free prescriptions—something that sat in a separate budget line—and introduced new burdens so that the budget line for boards rises but the money is already all committed. How cynical is that?
Will the member take an intervention?
No.
There are other new burdens, such as the responsibility of running of health provision in the Scottish Prison Service.
Will the member give way?
Perhaps, if the cabinet secretary can answer this question. The responsibility of running health provision in the Scottish Prison Service has been moved to health, but the £10 million that it takes to run that service seems to have been lost in transition. Will the cabinet secretary tell us where that £10 million has gone?
It is called joined-up government.
I have a question for Jackie Baillie: given that before the draft budget was published Labour’s position was that it would not protect the health service, will she tell us what the position is now? What would Labour do differently?
Contrary to what the cabinet secretary claims, we have always said that we would pass on the Barnett formula consequentials and that we would protect health, but that we would do more than that—[Interruption.]
Order.
The cabinet secretary asks the question but does not want to listen to the answer. Frankly, when she can explain where the £10 million has gone in the transfer from the Scottish Prison Service to health, I might be able to engage with her more sensibly.
Wind up, please.
There is a capital reduction of £69 million, and the Government has not told us where the cuts will come. Which projects will not be proceeded with? What the Government has done with social care spending underlines where it is going. It has presided over a decline in social care spending from 2008 of—
I am sorry but the member’s time is up.
Can I finish on this point, Presiding Officer?
No, I am sorry. The member’s time is up. I call Linda Fabiani.
10:02
Another day and yet another Labour debate focusing on process rather than policy.
In its motion, Labour says that it wants four years of spending plans. Labour says that “uncertainty is corrosive” and impacts adversely. It has changed its view since its own Alistair Darling did the same in 2006 and 2010—yet another example of Labour’s selective memory. In July 2009, Alistair Darling said:
“As I said in the Budget statement, the current economic uncertainty means that it would not make any sense to try to set departmental budgets now for every year to 2014.”—[Official Report, House of Commons, 14 July 2009; Vol 496, c 145.]
Will the member take an intervention?
No, thank you.
Let us look at the facts of where we are today. We have already taken the most difficult decisions, as Governments do. The largest cut to our budget comes in 2011-12, so it is nonsense to say that John Swinney is trying to conceal the most difficult decisions until after an election. George Osborne has said that he will make changes to the Scottish departmental expenditure limits and annually managed expenditure in his budget in March, so why should we announce spending plans that would then have to be changed? Then we have the Christie commission, which is due to report next summer and whose work will probably lead to major reform of public service delivery. There is little point allocating money to public bodies that in theory may not exist.
On bodies that may no longer exist and Labour’s concern about organisations’ potential inability to plan, let us consider Labour’s position. Its leader told his conference that he would create a single police force, reduce the number of health boards and scrap quangos. There was no mention of discussion; just a unilateral decision. Labour therefore wants to set plans for four years, have organisations make commitments for a four-year period and then abolish them forthwith. I suggest that that is corrosive.
Then we have Labour’s spending pledges—£1.7 billion in their policy documents, and another £1 billion-plus in random ideas. Johann Lamont said that there are challenging times ahead, and then Labour makes promises that it cannot keep. I suggest that that is corrosive.
How does Labour intend to pay for the retirement and winding-down arrangements for teachers, for replacing the Government fleet with low-carbon vehicles, for free newspapers for all 18-year-olds and for alcohol treatment and testing orders—even though Labour members voted against the most comprehensive measures to tackle our alcohol problem? Perhaps Labour believes that the Calman commission came up with the answers and that things will all be grand when it passes the Scotland bill in conjunction with its unionist partners.
Has Labour ever addressed the Calman conundrum? Within four years of the current UK spending review, the full force of the Scottish Parliament signing up to Calman will begin to hit home. Up to now, despite the occasional duplicity of the Treasury—for example, on Olympic regeneration money—the funds available to the Scottish Parliament have increased in line with public expenditure in England. After Calman, that will no longer be guaranteed. Instead, for more than 10 per cent of its budget, the Parliament will be able to rely only on the funds that can be raised from the basic rate of income tax. However, as announced in its 2010 budget, the UK coalition Government is making changes to income tax allowances that are designed to lift lower-income earners out of taxation and to increase the number of higher-income taxpayers—both of which changes will reduce income from the basic rate of tax. The number of people paying the higher rate of income tax will increase by up to 700,000 throughout the UK and perhaps by 60,000 to 70,000 in Scotland, and any income that is earned above the basic rate of tax is exempt from the Calman tax.
Can the member clarify whether she believes that the Calman proposals apply only to the basic rate of tax? My understanding is that that is simply not true. Can she clarify that she just said that?
Until the Scotland bill is published, we will not know what will happen, because those parties that have come together to talk about their proposals have never come clean about what they really intend. They have never come clean on the cost of the proposals to Scotland.
Will the member take an intervention?
No, thank you. I am answering your intervention—that is how it works, Ms Alexander.
The changes that have been announced by the coalition Government are a perfect example of how changes in the pattern of taxes could reduce the funding for the Parliament post Calman. If we genuinely had power over taxes in this country and could make compensatory adjustments, we could make real differences. Perhaps Labour can explain today how it is going to account for the Calman squeeze and how it can project a budget over the next four years. I will certainly ask Mr Danny Alexander that question at the Finance Committee meeting later today. Everyone who is involved in trying to foist these proposals on Scotland should give us answers.
10:08
This weekend, Scottish football faces a crisis that was brought about because a senior referee made a mistake and lied to cover it up. Having failed in their effort to hoodwink their way out of the error, the referees have called a strike to deflect attention away from the failure of their deception strategy. Having heard the arguments put forward by the SNP to justify its deceitful plans for a one-year budget, I am left wondering whether the SNP is using the same strategists as the Scottish Football Association referees.
For example, last week I was interviewed on holyrood.tv alongside Nigel Don on the implications of there being only a one-year budget. The normally rational Mr Don unfortunately resorted to reading from his central office briefing and rehearsed the ludicrous argument that we need a one-year budget because—as the SNP apparently believes—telling people what the budget is over three years or more will limit their thoughts on how to manage in the future and will prevent them from focusing on the immediate problems that the country faces. What patronising nonsense. As the SCVO said in its recent written submission to the Local Government and Communities Committee,
“if we want to really open up the sector’s potential, then the setting of a one year only budget will make medium term planning over 3 years difficult.”
SNP back benchers may not want to acknowledge the fact that the third sector might know what it is talking about, but I certainly do.
We can hardly blame SNP back benchers for talking rubbish, however, given the example that was set for them by the Minister for Housing and Communities, Alex Neil, on Sunday’s “The Politics Show”. Reverting to his previous role as minister for television studios and defender of the indefensible, Mr Neil attempted to mislead people, on the BBC, by claiming that the local government deal had the agreement of all the political parties within COSLA and that our local authorities were happy with their lot. Let me correct Mr Neil and assure Parliament that, although Labour-led local authorities may, ultimately, have to succumb to the SNP’s blackmail and respond to the horse’s head that has been placed in their budget by agreeing to the package that has been forced on them, the Labour group in COSLA boycotted the negotiations and in no way endorses their outcome. COSLA’s Labour group leader, Councillor James McCabe, said that the agreement merely indicates that the SNP Government has
“gone from deception to dishonesty and now dictatorship”.
He went on to call the deal the worst example that he had ever seen of central Government dictating to local government in order to have councils do the SNP Government’s dirty work for it.
On Sunday, I spoke to a local authority chief executive who told me that he feared that the best plans that he could put in place under a one-year budget may, ultimately, bring greater difficulties in the longer term because he may overestimate the cuts that are to come to certain sectors or decide that his figures are wrong, creating huge holes for later years.
How would that chief executive deal with a situation in which the budget numbers had to change in later years because of decisions that Parliament may make about future budget provision?
All chief executives know that they must adjust budgets—that is normal practice. However, following the cabinet secretary’s logic, we might as well have one-month budgets. Things can change over time and chief executives have to react to different circumstances. Their budgets must be fluid but they can be planned over a longer period.
In its written submission to the Local Government and Communities Committee, COSLA itself said that a one-year budget is
“a fundamental concern for Local Government which needs greater certainty over the longer term”.
To say that these organisations cannot use that information effectively or need to be protected from having to deal with difficult projections until after this difficult first year is an insult to them. It is, though, highly indicative of the contempt with which the SNP Government treats the Scottish people.
Labour councillors and MSPs do not and will not agree with anyone who believes that this one-year settlement serves the needs of our local authorities, which have to plan for the delivery of services on which vulnerable people, especially, depend. We know that these are difficult times, but they are times when real leaders stand up to be counted and do not play games. This one-year budget—or, more accurately, this one-month budget that takes us from April to May—is a mistake and the arguments that are being deployed to justify it will not wash.
Yesterday’s debate saw the cabinet secretary show regret and issue an apology. Unfortunately, on television last night, the cabinet secretary’s attitude changed back to the arrogant and dismissive tone that caused the problem in the first place. I hope that, come 5 o’clock tonight, when the Parliament again makes a decision that says that the cabinet secretary is wrong, he will reflect on that, change his mind and do what is right for the country, not what is right for himself and his party. The country deserves better than this, and Labour is ready to deliver it if the SNP is not.
10:14
Jeremy Purvis seemed to suggest that, because three quarters of the members in the Parliament voted in a certain way, the Government should listen to them. However, it is a long-established principle that votes in the Parliament are not binding on the Government.
Will the member take an intervention?
No. If Richard Baker sits down, he might learn something.
The principle is long established in both the Westminster Parliament and the Scottish Parliament. I regret that I do not have the quotation in front of me, but Mr Whitton can confirm that the First Minister who stated that in the Parliament was Donald Dewar.
That statement was made in response to Bruce Crawford, who demanded that every vote in the chamber be binding on the Executive.
Governments will always reflect on what the Parliament says, but a vote in this Parliament is not binding on this Government and was not binding on previous Governments.
Jeremy Purvis boasts that, in the first eight years, the Government was defeated only five times. I say to him as gently as I can that the reason for that was that the Liberal Democrats were in coalition with the Labour Party—they had a majority. We have always had a Parliament of minorities; that is nothing new. We have a minority Government, but it has always been a Parliament of minorities. The difference is that the Liberal Democrats were Labour’s little helpers in the first eight years.
When I saw that the title of Labour’s motion was “A Budget for Scotland’s People”, I thought that at long last the Labour Party was going to tell the people of Scotland what its plans and priorities were in the light of the hugest cuts in public expenditure for a generation, two thirds of which were the legacy of the previous UK Labour Government. Silly me—“Labour policies” is an oxymoron. No wonder Labour wants to harp on about process; it saves it from having to talk about policies or priorities.
I understand why the Liberal Democrats are complicit in Labour’s little game: they have always been Labour’s little helpers. Those who are surprised by the Liberals’ behaviour in coalition with the Tories at Westminster over tuition fees really have to look at recent history in the Scottish Parliament. Despite promising the opposite before the election in 1999, the Liberals helped Labour bring in tuition fees by the back door in this Parliament. It took an SNP Government—thank goodness—to abolish the graduate endowment tax.
I am genuinely surprised by the Tories’ position. Perhaps it is because there is something in the water or perhaps it is just because an election is looming.
Or perhaps it is because no previous Scottish Government has ever failed to publish a spending review in the year in which a UK Government has done so.
It is also true that there have always been one-year budgets.
I have just been handed the quotation that I referred to earlier—I suggest that all the other parties listen to this. In October 1999, Donald Dewar said:
“As part of these perfectly normal constitutional arrangements ... the Scottish Executive is not necessarily bound by resolutions or motions passed by the Scottish Parliament.”
Last week, John Swinney produced the real people’s budget, protecting the most vulnerable from Westminster’s cuts. Let us look at the budget that he produced: £70 million to freeze council tax for the fourth year in a row; the final stage in abolishing prescription charges; a living wage across the public sector; funding for front-line NHS services increasing by £280 million; a guarantee that the 1,000 additional police that the SNP put on our streets will continue; no changes to the concessionary travel scheme; a new Forth bridge, which is vital for the economy of Fife and the east of Scotland; and a commission chaired by Campbell Christie to look at the delivery of public services—a measure that I particularly welcome, given that I raised the whole issue of public sector reform in the pre-budget debate a couple of months ago.
Will the member take an intervention on that point?
I am almost finished and I have things to say.
It is vital that the public service landscape is transformed, not just for the difficult financial times but so that Scotland has a better and more responsive public service. That will free up money to deliver the services that the people of Scotland need. Campbell Christie and his commission need to be bold. They need to be given the time to do their job properly, because the savings will inform budgets not just in the next three years but in the next 30 years. That is not short-termism; it is a responsible Government looking to the future of our country. What a pity the Labour Party cannot rise to the occasion and suggest the same measures.
What are the Labour Party’s priorities? It will not tell us in this chamber. Iain Gray and the Labour Party in Glasgow want to increase council tax—the Labour council tax junkies are addicted to rises in the council tax, punishing the most vulnerable people, just like they did with the 60 per cent rise in council tax in the first eight years of the Parliament.
Since mid-2009, Labour has pledged £2.8 billion in spending plans, so what is it prepared to cut to meet those pledges? Labour can run, but it cannot hide. It will have to give an answer to that question in the Parliament, in the committees and to the people of Scotland.
10:20
Given what has happened in recent days, we are living in times of important constitutional debate. Tricia Marwick was quite right to focus on the relationship between the Government and the Parliament, which lies behind this debate and a number of others recently.
A change is taking place. For a large part of the SNP Government’s four-year term, it has had a tendency—dare I say, a very arrogant tendency—to disregard votes in the Parliament and to say that they are of no account or importance. We are now seeing Parliament reassert its power—and rightly so—in these important budget debates. That is the trouble that the SNP Government has in this question of the single-year budget. Parliament does not like it, Parliament is right not to like it and the Government will require to respond to that strongly held view in Parliament.
It is probably trite to say that we are meeting less than six months before the Scottish Parliament elections, but that is a matter of realpolitik that influences our debates. More important, it seems to paralyse Governments—not just this one, because we also saw it in the latter days of Gordon Brown’s Government at Westminster. As the election approached, decision making shut down, fiscal decisions were ducked and the incoming UK Government was left with a debt liability of £120 million a day and rising to service the enormous public debt. That of course is the background to today’s debate.
The SNP Government is following that precedent. John Swinney said as much when he referred to the approach taken by the Labour Government. The Scottish Government knows, as the whole country knows, that public bodies, councils, tertiary education institutions and the voluntary sector need a longer-term framework than one year to plan ahead. It knows that services are put at risk unnecessarily if they can plan only year by year and that the opportunity to adjust to straitened budgets is lost, yet it judges that that is better than taking the vital decisions—not better for the country, the voluntary sector, individuals, communities or Scotland, but better for the SNP. It is wrong on all counts. Scotland would respond to a First Minister, finance secretary and Government who told it as it is and took the right decisions.
I am also puzzled by an enigma. In Scotland, the cuts have not yet arrived. Not a penny of Scottish budget prior to next April has been lost because of the comprehensive spending review or the actions of the coalition Government, yet every health board, police authority, council and voluntary sector body in Scotland has been feeling the pinch, cutting services, encouraging early retirement and losing staff—since 2007, 3,000 teachers have been lost, as have large numbers of social workers and nurses and many others. The substantial reason is the undermining weaknesses in the concordat with local government and the SNP freebies. About £1.5 billion has been removed from the Scottish budget—from supporting front-line staff—to pay for the SNP freebies.
If our relationship with local government is so in jeopardy, as Robert Brown seems to describe it, why has the Liberal group in COSLA supported the deal with the Scottish Government on this year’s budget?
As Jeremy Purvis says, the point is that there has been an element of blackmail to all that, which has underlain it right from the beginning.
As Jeremy Purvis rightly said earlier, Liberal Democrats have spelled out what the Government needs to do in pay policies, efficiencies, the slaughter of SNP sacred cows, the mutualisation of Scottish Water and tackling the problem and challenge of public sector bonuses and out-of-control salaries at the top.
Jackie Baillie rightly talked about the disincentive of single-year budgeting. The Government needs to put in place frameworks for change, particularly a framework for an agenda of support and respect for the voluntary sector, particularly at the council and health board level, where the bulk of public funding to the sector comes from. After 1999, there were council compacts with the voluntary sector that postulated three-year funding, access to council contracts and full cost recovery. In fairness, some progress was made, but the compacts are now a dead letter and an historical footnote.
Third sector bodies should have access to public contracts on a workable basis, and funding cuts should be made in partnership with that sector on a planned basis to allow alternative models of funding to be developed. It can take two years or more to build a good project, but it can be closed overnight, taking with it months and years of painfully accumulated experience, contacts and trust. For that reason, four-year funding plans are vital.
What is true for the voluntary sector is also true for the police. On Tuesday, I extracted the admission from the Association of Chief Police Officers in Scotland that up to 1,200 police civilian support staff could be lost. That would undermine the effectiveness of the pledge to retain 1,000 more police officers than there were in 2007. That is another little detail that lurks unrevealed behind the budget documents.
Will the member take an intervention?
I am afraid that I cannot, as I am in my final minute.
There has been an important debate on police numbers, which are an important component in reducing crime rates. However, numbers in isolation have no meaning if front-line police officers are drawn back into carrying out back-office functions. Indeed, a major purpose behind the civilianisation of some posts was to release professional police officers for the front line. What the public are interested in is a visible police presence on the streets and an effective response to deterring and catching criminals. More flexibility in that area may well be required.
In conclusion, there is no doubt that MSPs from all parties face a severe challenge. We are entitled to leadership from our Government, statesmanship from our leaders and MSPs, and insight and innovation from our public and voluntary sector partners. However, above all, we need the time that John Swinney’s short-term and short-sighted budget has not given us. It is not too late for him to think again.
10:26
In June 2007, we heard a statement on the strategic spending review. Praise has been in short supply for the cabinet secretary in recent days but, in the debate then, I congratulated him on continuing the practice of indicating a three-year funding settlement to local authorities and asked him whether he agreed that that practice should be extended to the voluntary sector. He indicated that he supported that ambition and, indeed, that he would take forward the matter with local authorities. He said:
“it gives organisations sustainability, continuity and clarity about where they are going.”—[Official Report, 28 June 2007; c 1220.]
It is therefore bewildering that, with the opportunity to set spending for three years now—I would argue that there is a much greater need to do that now—the cabinet secretary has decided to set a one-year budget instead.
In response to a point that Mr Purvis made at the beginning of the debate, Mr Swinney said that he would reflect on the outcome of today’s debate. I hope that, in the spirit of what Robert Brown said in his excellent speech, those were not just warm words and that he is ready to alter his position. If outlining spending for three years was important for sustainability and clarity in 2007, it is crucial now, when, as we all know, we are facing severe reductions in public expenditure in the years ahead. Of course we will debate the scale and pace of those cuts and why we have the deficit. Some people seem to believe that we should have let the Royal Bank of Scotland and HBOS collapse and let chaos ensue. We will debate how we should respond to the situation in the Parliament, but we should be able to agree on the need for clarity going forward, and we should do all that we can here to provide greater certainty, not more uncertainty, about the future for public spending. That is crucial for our public services, but it is also hugely important for the private sector—not only for contracts but for the future of investment in capital projects and other areas. Indeed, it is crucial for our whole economy.
Like Robert Brown, I believe that the one-year settlement fails local authorities in particular. As an MSP for North East Scotland, I am acutely aware of the consequences for our councils. Yet again, the Scottish Government is imposing a council tax freeze while failing to provide councils with anything like adequate resources to compensate. That means that Aberdeen City Council is already planning £127 million in cuts over five years while we do not know what funding the Scottish Government intends to provide to local authorities beyond the conclusion of the one-year budget period.
Perhaps our police forces are affected more than anyone else by the irresponsible approach that has been taken to the budget. It is entirely understandable that, as Johann Lamont mentioned, the budget has been described as a “dereliction of duty” towards our police forces. The agreement with councils requires them to maintain police officers. Of course we should focus on maintaining police officers, but the Scottish Government is telling councils to maintain police numbers without giving them the money to do that; indeed, it is cutting the police central grant by £31 million. That is fundamentally dishonest on a number of levels.
I know that the member is not a member of the Justice Committee, but is he aware that the finance director of ACPOS and the Scottish Police Federation made it clear during the committee’s meeting on Tuesday that they were confident that they would maintain the 1,000 extra police officers for the coming year?
I know that Stewart Maxwell is not a member of the Local Government and Communities Committee but, if he had been at that committee’s meeting yesterday, he would have heard witnesses clearly stating that no moneys were ring fenced in the local government settlement to maintain police officer numbers. Money has not been awarded to local authorities to do that. Nevertheless, the Scottish Government is telling forces to end the recruitment freezes that they have had to put in place and to start to recruit officers whom they will be required to employ for some 30 years. However, the Government will not give them any clarity on funding for any more than a solitary year. In doing so, it is leaving a situation in which officers will start to be recruited again in Strathclyde, for example, but the price of that in a single year, according to Unison’s estimate, is that 1,300 civilian staff jobs will be lost. That price will be felt not only by those who face redundancy but more widely in communities, as police officers will be taken off the beat to do those jobs. Those police officers will not be doing what we want them to do and what they have been trained to do.
Will the member take an intervention?
I am afraid that I do not have enough time to take an intervention. I know that I will not get much more than six minutes to speak.
The Scottish Police Federation has said that the cuts that are already being planned by police boards are equivalent to losing 2,800 officers. That is the reality. PricewaterhouseCoopers has estimated that the number of front-line police officers in Scotland will drop by 2,000 over the next four years. Where does that leave the SNP’s famous pledge? The fiction is that the Scottish Government is maintaining its police numbers promise; the reality is that it is leaving our police forces to make plans for cutting police activities, which will impact on the safety of our communities. Our police forces need clarity so that they can plan properly for the future.
That is why it is incumbent on the Government to do what it has every opportunity to do: to set out a three-year budget so that members can make informed decisions about the future of our public services, and we can have clarity about what must be done in order that key, front-line services, such as those that our police forces provide, can be protected even in these daunting times for public finances.
10:33
In this debate about the difficulties of budget making in uncertain times, we should look at a little bit of the background.
When the Labour Government in London was dealing with the cash crisis, the credit crunch and so on, it said that the contagion around the world was the root of the problem. It started by saying that it was someone else’s fault. However, it is not sufficient for us to sit here and say that we cannot address a part of that problem because we are getting the backwash from those larger events.
Things are made all the more uncertain by the fact that George Osborne and Danny Alexander have said that they will make changes to the Scottish departmental expenditure limit and annually managed expenditure in the budget in March. That means that we in Scotland are placed in a position by the cuts that were imposed last time—they represent two thirds of the cuts that we face; the coalition Government has made the extra third—in which we have to consider what potential and room for manoeuvre Scotland has. At present, that room for manoeuvre is extremely restricted. However, it has been stated that the worst cuts in the next four years are likely to be made in the coming year. That ought to be of some comfort to people who keep saying that they want a three-year detailed settlement. If we reach a stage at which there is some certainty, it might well be possible to make that up, but there are too many uncertainties, which have been caused by factors that are outside our control, for that to be able to happen.
Will the member take an intervention?
Not at the moment.
I want to talk about some of the substance of what we are presented with in the motion. The Labour Party will not talk at all about the policies that need to be applied in Scotland. We have had a string of Labour MSPs calling for more and more spending—around £3 billion-worth of spending. In motions, statements and demands, we get lists of promises. At a time when our finance secretary is attempting to come up with some reality, we have to face demands such as Sarah Boyack’s suggestion that we spend £450 million to replace the Government fleet with low-carbon vehicles or Peter Peacock’s suggestion that Highlands and Islands Enterprise should be given £50 million more. We are told that improving environmental structures in schools should be done immediately, which would cost another £816 million.
That irresponsibility contrasts with the common sense that has been applied in the budget that John Swinney has brought before us. The motion talks about a budget for the Scottish people, but such a budget is to be found only in the Government’s proposals and not the irresponsible promises of the Opposition.
Can the member explain why Wales and Northern Ireland have produced spending plans for more than one year but it is beyond the wit and ability of his minister to do that?
Did the member not listen to what I said about the situation with regard to George Osborne? Wales and Northern Ireland might be taking a risk, as they might have to alter their plans rapidly in March when DEL and AME are reconsidered. The sensible thing is to work with a budget that can actually be delivered. As far as I am concerned, the social contract that we are talking about building is contained in the budget.
Will the member take an intervention on that point?
Not at the moment, thank you.
When we talk about delivering the council tax freeze, that is not because we think that it is the ultimate solution. It is a practical solution in the short term, until we have room for manoeuvre or the support to introduce a more positive way of taxing people. When we talk about free prescriptions, that has been a long-term pledge, because it is about helping some of the poorest in society. When we talk about real-terms increases for NHS boards, that is in the context of the limited funds that we have. The protection of free personal care, concessionary travel and police numbers, which have been discussed, is part of that social contract.
In a time of uncertainty, it is essential that we ensure that the fabric of Scotland’s life is protected, and that is what John Swinney has been able to do.
Will the member take an intervention on that point?
No, thank you.
When we talk about the ways to achieve that, we find even more flip-flops happening on the Labour benches. We have talked about the need for a pay freeze to maintain jobs. At the Labour Party conference three weeks ago, Iain Gray, the Labour leader, said that he would introduce a three-year pay freeze but, last weekend, Andy Kerr criticised the Scottish Government’s move to combine pay restraint to preserve jobs with a living wage and council tax freeze to protect incomes. Whom do we believe? Those members are on the same front bench, but they have entirely different views. It is important that, throughout Scotland, we have a consistent approach and ensure that we have practical policies that meet the considerations of the current uncertain times. That is what the budget will do, but it is not what the budget that the Opposition proposes would do. The Opposition is irresponsible, but the SNP is responsible.
10:39
The reality is that there is probably less uncertainty about the general financial climate than there has been at any time in the past three years. The Westminster Government has produced a three-year budget settlement, so any uncertainty arises from the SNP Government’s failure to take its responsibility seriously. It is the Government’s responsibility to plan for the future and to manage its spending. The reality is that the Government has maxed to the limit every aspect of money that is available to it and now we face a hole for the future.
Yesterday, the cabinet secretary accepted that he had made mistakes in not informing Parliament of the implications of decisions that he had made and he promised to do better in future. He could begin by admitting that the budget document is in effect a work of deception and a stop-gap measure to get his party to the election without having to take responsibility for any of the decisions that face Scotland. Those decisions will be more difficult and more damaging for public services, public sector employees and Scotland because the Government has put short-term political advantage against and above the national interest.
The budget document is full of dishonesty. The books are balanced using a 3 per cent efficiency figure that, as Mr Swinney knows full well, will come from cuts, not efficiency savings. When Mr Swinney sat on the Finance Committee in a previous session of Parliament, he signed up for a level of scrutiny that demanded that all projected efficiency savings in government should be specified properly and that the plans for implementation should be published. I remember going through those plans, sitting next to Mr Swinney, as we engaged in the detailed scrutiny that, as elected representatives, we had a duty to undertake. However, there is no specification whatever of efficiency savings in the budget document. The savings will be all the more difficult to achieve in the context of shrinking budgets. Those savings are cuts—unspecified cuts.
Frankly, that is just dishonest budgeting. Whatever the outcome of the election, I believe that we will not hit those financial targets. It is highly likely that we will end up with an emergency budget, which will seriously damage every aspect of public services in Scotland. The responsibility for that will be with Mr Swinney and Mr Salmond, because they have been dishonest.
It is not just the efficiency targets that are dishonest. As my colleagues have shown, in almost every case, the specific commitments that the Government has made are not supported by the facts, either in the budget document or in the published letters that provide further information, or in information that is only now beginning to leak out more than a week after Mr Swinney delivered his budget. Mr Swinney resembles that cartoon character Wile E Coyote—he has jumped off the cliff, the legs are still spinning round and he hopes that he can stay up there, before gravity takes hold. Gravity will take hold of Mr Swinney. The danger is that we will all crash to the floor along with him. He will take Scotland with him. The risks that he is taking with Scotland’s public services are reckless and, I believe, they will prove to be self-defeating when we get to the election in May. If, as Fintan O’Toole suggests, Ireland’s economy was derailed by a ship of fools, what metaphor can we use for the parcel of rogues on the SNP benches who are selling Scotland short?
Derek Brownlee raised the issue of higher education. I see that the Cabinet Secretary for Education and Lifelong Learning has come into the chamber. He has blackmailed the universities into accepting a sizeable cut in their funding, which is variously estimated in a letter that he sent as 5 per cent, 6.7 per cent, 8 per cent or more than that, depending on which paragraph of the letter one reads. The deal with the universities is basically that they transfer funded places into unfunded places and admit the same number of students next year. It means the same number of students for less money, which is not a good deal for the universities.
Bruce Crawford rose—
Sit down, Mr Crawford.
The commitment that the Government has made for next year’s students is for eight months, but the commitment that the universities have entered into for many of those students is for four years. The universities are faced with a black hole, while the Government simply will not say what plans it will introduce for the future funding of higher education. Mr Russell says, “Mibbes yes, mibbes no,” to a graduate contribution. I have been at conferences at which he said different things at different times to different people. In his letter, he apologises, although not by actually saying, “I’m sorry.” He recognises that the reality is that those institutions, which are vital to Scotland’s future, cannot plan properly or project their route forward because of the Government. Because of political self-interest, the Government is destroying Scottish higher education.
It is not just higher education, because colleges are in the same situation, and let us look at schools. Mr Russell walks round Scotland as the Great I Am of Scottish education and the originator of every possible positive reform in education. The reality is that he is destroying the whole basis of it. How can we deliver better education in Scotland if we have fewer teachers? There has been cut after cut in teacher numbers and necessary professional development funding has been destroyed, all in the name of the council tax freeze. We have already had three years of education cuts; next year, we will face more and worse cuts. That is all down to this lot in government, their policies and priorities, which are ultimately all about them, not about our children and not about Scotland. They are a bunch of rogues.
10:45
Three weeks ago, I took part in a debate in this chamber on managing Scotland’s public finances. It was not the Parliament’s finest hour, if we leave aside Ross Finnie’s contribution. I thought that such political knockabout was now out of the way and that today’s debate would be a bit more constructive, and it has been, apart from a few gems of yah-boo politics such as
“sacrificed on the altar of party politics”;
“minority Government with a majority ego”;
“blackmail”; “horse’s head”; and “dishonesty and now dictatorship”. We have also had Mr McNulty speaking about Wile E Coyote and blackmail, and Robert Brown speaking about
“the slaughter of SNP sacred cows”.
Earlier in his speech, Robert Brown said that the people of Scotland would appreciate the finance minister and the First Minister telling the people how things are. As we face cuts of 6.3 per cent, 1 per cent, 2.6 per cent and 1.8 per cent, that is how things will be in the coming years. I am sure that Mr Brown knows that because he will have looked at the CSR. Every one of us in the chamber is aware of the state of the UK public finances and we are all aware of the CSR that was produced recently by the Conservative-Lib Dem coalition Government in London. We are also aware of the effects that the CSR is having on the Scottish budget—a cut of £1.3 billion for next year, which equates to a 6.3 per cent cut. The challenge for the Scottish Government and the Parliament is how we deal with that.
I will touch on other budget issues in a moment, but first I want to discuss one particular area. The Labour motion talks about the uncertainty that the presentation of a one-year budget will create. That would be a legitimate argument if it were the first time that such a budget has been undertaken but, as we know, the Parliament only ever produces a one-year budget. Further years are indicative and subject to change. A further point was made in comments from David Bell, who is the adviser to the Finance Committee.
Will the member give way?
I ask to make some progress.
Mr. Bell wrote in his report to the committee:
“However, if it is only a single year budget that is being presented, it is not clear what budgetary purpose is being served by looking beyond 2011-12. For example, it seems incongruous to include ‘forecasts’ of how long it might take public sector spending in Scotland to return to 2009-10 levels when these extend to 2026-27.”
The member stated the caveat that previous budgets have been indicative and subject to change in future years. In that case, what is wrong with having the figures for future years in the 2011-12 budget and adding the same caveat that the figures are indicative and potentially subject to change?
I was coming to that point.
As our level of public spending is to be less than we wished for many years ahead, John Swinney deserves tremendous credit for commissioning the Christie commission to look at the longer-term position of our valued public services. Clearly, if the money coming to the Parliament is to be cut year on year and then take many more years to get back to the 2009-10 levels, it is common sense that we have no other option than to examine how best we can provide our public services. I can think of no better person than Mr Christie to look into that.
Will the member give way?
I have to make progress.
As for the impact of the budget and how services will be affected, the debate about that is live in the committees of this Parliament as well as in wider Scotland. Yesterday in the Economy, Energy and Tourism Committee, we heard that the Scottish Trades Union Congress would abandon the small business bonus scheme. We also heard Professor Brian Ashcroft of the Fraser of Allander institute and Alf Young state that if they could alter one thing in the budget, they would remove the protection from the health budget. They felt that, if cuts were to be made, the health budget should not be protected. Yesterday’s evidence-taking session highlighted many more suggestions, but those two stood out. I disagree with the suggestions—I am sorry to say that I disagree with Mr Young, because it is not often in the Parliament that we find two Greenock Morton supporters in the same room at the same time. Everyone has their own ideas. The budget process is about putting them into the melting pot and moving things forward.
As well as the uncertainty of the Scottish budget in the future, it looks as though the chancellor might alter Scottish DEL and AME in his March budget. Then there is the small matter of the election in May. It goes without saying that I believe the only sensible way that the Parliament can continue to progress is for the SNP to be returned, but I have only one vote and it will be up to the Scottish electorate who will manage our finances after the election. If it is Labour, which has different priorities from those of the SNP, the council tax freeze will be stopped, private finance initiative car-parking charges that it introduced will be stopped and, according to its policy document, it will purchase a newspaper for every 18-year-old.
Budgets are about choices and parties have to stand on their record of what they have delivered. This budget, however, is unprecedented in the short history of this reconvened Parliament. With massive cuts cutting too deep and too fast, the Cabinet Secretary for Finance and Sustainable Growth has the thankless task of trying to steer Scotland out of this situation with his hands tied behind his back. I will support his amendment this afternoon.
10:51
Several members have reflected on their experiences of working in parts of the public sector, whether in local councils, the NHS or elsewhere. I have never worked in a local authority or the NHS, but I have worked in the voluntary sector in an organisation that had a funding mix, from voluntary and charitable sources as well as the local authority, the health board and central Government. My experience was of scrabbling around, sometimes for years and sometimes for shorter periods, for the next grant or bit of funding, always spending a third of my time evaluating the work that I had done, another third seeking the next bit of funding and only a third of my time getting to do my job. Such short-term funding gave rise to huge frustration as well as a great deal of inefficiency. We were not able to plan properly or apply long-term forward thinking to either the ideas that informed our work or the way in which we structured our organisation.
There will be a huge amount of frustration out there in many parts of the public sector and in the organisations that depend on and work with the public sector about the short-term thinking that is going on. We know that many people will be forced to make short-term decisions that they know will not be the right ones in the long term. Nobody wants to be in that situation and I suspect that John Swinney would like to find himself in a situation in which he could give greater long-term clarity.
What are the arguments that John Swinney has used against giving that clarity? The central one is about the Christie commission. He has argued that we must look at restructuring public services in a deep and fundamental way and that, before we know the recommendations that the Christie commission will come up with, it would be wrong to set budgets that will have to change. I query the timing of all that. The recommendations from the Christie commission might well be very useful; some good ideas might come out of it. However, priorities will also be set by the election results next year, by manifesto commitments, by the political balance in the next parliamentary session and by whichever party or parties happen to be running the Administration in the next session. The Christie commission will emerge with its recommendations a couple of months after that. I think that the cabinet secretary said that the commission was due to report in June. There is no reason to expect that radical change in the structure of public services, if that is what the Christie commission recommends, will see both political agreement among parties and legislative action to implement it, if that is necessary, in time for next year’s budget process.
Long-term changes might well be needed in parts of the public sector, but we will budget for them when we know what they are going to be. Until then, we have to allow the public sector to plan. The sector will need to bear in mind the possible future political decisions and choices that might be made, but it should not be left in limbo in the meantime. In that sense, there is at the very least no reason for not publishing the following year’s figures in advance, and I agree with members’ comments about publishing figures for the CSR period.
John Swinney stressed his record of compromising and working with other political parties in successive budgets. I absolutely agree that on some issues there has been very good compromise. The Greens have taken many ideas into the budget process, and the Government has taken up quite a number of them—although we have not entirely agreed with every detail of implementation. However, that very process of negotiation and compromise will have to happen in relation to manifesto commitments when we see the results of the election, ideas from the Christie commission and, indeed, ideas from elsewhere.
I agree with Johann Lamont that if we are talking about that long-term context, we need to give the public sector greater clarity now. After all, we know neither the commission’s recommendations nor the political results of our debate about them. Nevertheless, I hope that at the same time Johann Lamont agrees that a budget for Scotland’s people will need to listen to people during and after the election and that, in that respect, the most important message was given 13 years ago when two thirds of Scotland’s voters voted yes, yes to a Parliament with tax-varying powers. I think that Scotland’s people knew then that at some point in the future they would again see a right-wing Government they did not vote for inflicting an ideological attack on public services, and they wanted a Parliament that was capable of defending Scotland against such an agenda.
A budget for Scotland’s people would not slash the housing budget in the final years before our shared commitment to ending homelessness is due to be met. It would not freeze public sector pay, which, after all, is equivalent to an arbitrary tax on those employees, including many low-paid workers. It would not cut funding for higher and further education, arts and culture, the voluntary sector and public transport. Indeed, it would not simply hand on a series of Tory cuts that no one, not even Tory and Liberal voters, actually voted for. A budget for Scotland’s people would oppose that ideological, anti-state agenda by raising revenue progressively and fairly. We can do that in Scotland by empowering our councils to do it locally and in time by using the SVR or the Calman powers. If we mean a word of our speeches about social justice, public services, a greener economy and a more equal society, we must agree that that is the kind of budget for Scotland’s people that we need.
10:58
Scotland and its people face a challenging time as the stark economic circumstances begin to make a real impact on our lives—and we still have a long way to go. As a result, people need to trust their Government, even if it is at the end of its term. Facing a tough election is no excuse and Scots will simply not tolerate such comments. Scotland’s finances have been seriously challenged, but a Government should not opt out of its responsibilities just because things are hard. Once again, the MSPs on the Government benches have forgotten that they are in government and are responsible to the people of Scotland.
Every previous Administration has approached its budget through the CSR, and any departure from the practice of having three-year budgets is unprecedented. The cabinet secretary tries to pretend that delays in the past are somehow reason enough to excuse having a one-year budget, but I can tell him that they are not. Such short-termism gives rise to the accusation that we have already heard that the only reason for such a move is that the SNP faces a difficult election and wants to keep people in the dark. I agree that it faces a tough election, and the fact is that it does not have a single ally to back up its charge in relation to the one-year budget. Is it going to limp on against the overwhelming demand from other parties in the chamber and a range of organisations that is pleading with the Government for some long-term planning? It is not fair that Scotland’s local authorities, voluntary sector, police and arts organisations cannot look to the longer term; indeed, I have to wonder whether the Government is listening at all.
Moreover, I do not accept that creating a commission to examine the impact of public service reform is a reason for not having more than a one-year budget. Has the SNP ever heard of revising budgets? Does it not know that the budget could be adjusted to take into account the commission’s recommendations? At the same time, the uncertainty continues for local government workers, who do not really know what the no compulsory redundancy commitment actually means. Indeed, I am not sure that every local authority has such a policy. Nothing so far has convinced me that the Government’s policies protect low-paid workers. For a start, there is no commitment to the living wage in the budget. When will the Government stand up for the low-paid workers who will bear the brunt of the rise in the cost of living? Labour is committed to implementing a living wage and feels that such a commitment should be central to public service reform. After all, we have the power to introduce such a measure.
I acknowledge the work that Jeremy Purvis and others have done in pushing the Scottish Government to tackle the high bonus culture and recognise that the Government itself has moved on the issue. However, the issue is not the bonus culture for highly paid employees; indeed, I suggest that further scrutiny will reveal that the same attitude extends to the kind of retirement and severance packages that are not open to low-paid workers. I have been disturbed by answers to parliamentary questions that indicate that agencies such as Scottish Enterprise have been busy using public money to trim the workforce and give large packages to well-paid staff. In contrast, lower paid staff not associated with those agencies are walking away with nothing more than the statutory severance package. Such issues have to be addressed in any restructuring or reform of public services and, in that respect, I call on the Christie commission to examine fairness across the public sector workforce.
On the face of it, the situation with the arts budget is not as bad as people might have predicted; indeed, it does not seem to be as bad as the situation in England. However, the jury is out. In any case, it is hard to judge what is happening, because the figure is only for one year. In contrast, the Welsh arts budget is being cut by 4 per cent over three years. One can begin to appreciate why the arts sector is a little bit concerned: the Gaelic budget has been cut by 9 per cent and Creative Scotland, the National Galleries of Scotland and our performing companies face a 10.4 per cent cut. The Minister for Culture and External Affairs has said that the budget is so tight that there is no flexibility and organisations will simply have to do more with what they get. However, those organisations do not really know what that statement means because they only have the picture for one year and reductions in local authority funding and the lack of flexibility mean that the arts sector faces even more funding uncertainty.
The one-year budget will make planning hard in particular for museums, which are complex organisations that need to plan years in advance, and significant fixed costs have to be met to maintain our national collections and services to the public. Although I welcome the minister’s statement on continuing the policy of free access to museums, I am not clear about how the Government will achieve it with a one-year budget. As I say, the sector cannot plan on that basis. I also welcome Glasgow Life’s announcement that there will be no entry charges to Kelvingrove art gallery, but even George Osborne has said that the policy commitment to free access will continue to be funded in England.
This morning, a number of SNP back benchers have shouted at us, “What would you do?” For the purposes of clarity, I simply repeat that we would honour the convention of having a three-year budget and three-year projections; we would make it transparent; we would provide the financial information; and we would give certainty to all those organisations that want to see what is ahead.
I know that I have to close, Presiding Officer, but I must respond to Rob Gibson’s comment that we are taking a risk. On that basis, Ireland is taking a risk, Wales is taking a risk, the Confederation of British Industry is wrong, the Labour Party is wrong and the Liberal Democrats are wrong. Everyone but the SNP seems to be wrong. Nevertheless, I ask it to do the right thing tonight and listen for once to what it is being told. Fairness is what matters. We need a three-year budget for Scotland.
11:04
Labour’s amendment yesterday afternoon on the Scottish variable rate and its motion today are hardly Parliament’s finest moments—certainly not since 2007, when I entered this place. Yesterday’s overegged amendment, which used expressions such as “abuse of power”, was an attempt by Labour to play the man and score party-political points ahead of an election. I accept that some sincere speeches—but only one or two—were made in yesterday’s debate. I single out Patrick Harvie, who attempted to play the ball and who focused on process.
This morning, Johann Lamont has promised consensus and no yah-boo politics. That is not achieved by placing the word “corrosive” at the heart of the motion, which makes it impossible for the party of government to support. That is seeking not consensus but division.
Johann Lamont forged more consensus across the chamber by using phrases in her speech such as “dereliction of duty”. If that is an example of Labour in Scotland seeking consensus, let us hope that it is never placed in charge of delicate, high-level, international diplomacy—I can see that that would result in mushroom clouds around the world.
In these unprecedented financial times, as the minority SNP Government seeks to steer the 2011-12 budget through Scotland’s Parliament, it is simply not good enough for Labour to oppose for opposition’s sake. Labour’s policy ideas and budget suggestions are non-existent. Labour is running on empty. The three-year budget demand is a fig leaf to hide Labour’s inadequacies.
No one denies that there are strong merits in having three-year budgets. However, only outlines would be given, because the Parliament only ever sets one budget, one year at a time, as we have heard.
It has been said that the voluntary sector wants figures for three years. That sector receives most of its work via local authorities. It wants indicative figures for three years because it hopes that councils will give it more security of funding, and I understand that. However, voluntary sector representatives also raised many other issues with the Local Government and Communities Committee yesterday. They wanted to know whether a £7.15 living wage in the public sector would have an impact on the voluntary sector. They wanted to understand better whether if councils had no compulsory redundancies, that would keep more work in-house in local authorities and whether, as budgets were squeezed, work would be brought back in-house to avoid compulsory redundancies. They wanted to know how they might benefit from further challenge funding that was similar to the £70 million that the NHS will deploy in social care, to promote preventative spend.
A dynamic landscape is at play in challenging times. We have savage UK cuts, the onset of a living wage, redundancy issues in councils, shared budgets and a massive drive towards shared services in councils. Yesterday, the voluntary sector representatives also mentioned a culture of resistance in some quarters of the public sector.
Did the voluntary sector representatives mention the decline in social care spending that it has inherited from the SNP? In 2007-08, £3.2 billion was spent on social care. In 2009-10, that was reduced to £2.8 billion. To continue the football analogy, is that not a bit of an own goal?
One of the two of us has certainly scored an own goal. In its budget, the Government is protecting free personal care and, in the previous budget, it increased funding for free personal care.
For all the reasons that I have given and because of the dynamic situation that local authorities, all other public bodies and the voluntary sector face, the Scottish Government has established the Christie commission, which will attempt to achieve joined-up thinking in sectoral reform. That reform will not be dictated top down from the Scottish Government or via local institutional self-interest but will come from an independent review that is headed by a well-respected public figure.
It would be crazy to give a three-year indicative spend for budget lines now when how budget lines are drawn up and formulated and the purposes to which they are directed might change radically within a year. Structures might change. The Scottish Government does not intend to tie the Christie commission’s hands. Reform and new ideas are needed. We will move on to three-year budgets after the next election.
I will bring the Parliament back to the real world and the commitments that the Government has made to help the Scottish economy. When I went out for dinner last night to a little restaurant called Al Dente in Easter Road, I met a gentleman called Graziano, who is the restaurant’s owner. He told me that if it had not been for the small business bonus scheme, he would not have been able to employ a waiter or to keep his business going. That is real help in difficult times from another commitment in the budget—another commitment that the Labour Party has refused to back in previous budgets.
In hard times, when radical change and difficult decisions are needed, John Swinney is the man for the job and the SNP Government is the team for the job. I will back John Swinney’s amendment this afternoon.
11:11
I make no apology for focusing on the process of a four-year review, in the same way as the Government has made no apology for announcing the Christie commission, which is about process. We should not diminish the importance—at certain times—of matters of process.
It is disappointing that we got into difficulties yesterday because we wanted to stick to the legal position that the Scottish variable rate has—of course—not been abolished. After an hour or so of debate, it became clear that we should pay attention not just to the legal position but to what was happening on the ground.
Today, the cabinet secretary appears somewhat concerned to hide behind the requirement for only a year’s budget. The suggestion is that anything else is just an optional extra, but it is not. The history of the development of the production of financial information in the Parliament has been long and vexed. At times, the process has been highly unsatisfactory.
As a Cabinet minister way back in 1999, I well remember being deeply surprised at the paucity of financial information that was produced to the Parliament and to ministers. It has taken a long period of deep probing by the Finance Committee and a long process by those who have served in government to improve the appalling level of financial information and to recognise that, although we must produce a one-year budget for Parliament, we can do better. At times, those efforts were stymied by processes down in Westminster, when it switched from a longer-term view to a short-term view. However, I always took the position that that would not be good enough in Scotland and that a longer-term, four-year view was required.
I listened carefully to what the cabinet secretary said about why we could not take such a view. Of course we are in difficult times, but that is why the longer term needs to be considered. Just because we are in difficult times, that does not excuse the need to take a longer-term view. The Government has announced the Christie commission, which could suggest profound changes in Scotland, but I do not think that they would necessarily happen overnight. If the commission takes a genuinely long-term view, it will require time to report and Parliament will require time to digest the commission’s outcome.
It is interesting that no one has suggested that, now that the Scottish Parliament has existed for 11 years, one issue that needs to be addressed—perhaps the Christie commission will address it, although it is not explicitly mentioned in its remit—is the creep in the balance of power between local government and the Scottish Government, which perhaps requires to be defined more clearly.
None of that is an excuse for not following the development of the production of financial information to the Parliament by creating and allowing us to have a four-year view.
We have heard the excuse that DEL, AME and all sorts of things in the world are going to change. Well, that is new; the world is going to change! Good gracious, that will stop us having a four-year budget! My response is no, that is not the approach in the private sector and it should not be the approach in the public sector. We should be sufficiently fleet of foot to be able to make the adjustments that are necessary to allow informed decisions to be taken by the Parliament and its committees, local government, the NHS, the further and higher education sector and people who operate in the voluntary sector and other aspects of government.
That is what good financial planning and management are about. Unless we have a structure upon which we can base decisions, we are fumbling in the dark. If we are to appreciate the potential benefits even of a Christie commission report, we ought today to be able to see figures for four years, which would direct us to decide that we need to do things differently and better. We cannot come to such decisions if we are fumbling in the dark.
The arguments that were adduced by the Government in the debate were not satisfactory. Just as it was an error of judgment not to bring to the Parliament the changes in relation to the Scottish variable rate of income tax, it is an error of judgment to suggest that, just because there is a crisis, a single-year budget is the right way to proceed. Such an approach does not allow sensible forward planning. A four-year budget might have to be changed, but we would understand the basis on which longer-term changes were being made.
There has been a mistake and an error of judgment. The amendment in Jeremy Purvis’s name is well argued. There is a case for considering the longer term. Difficult financial circumstances do not excuse the Government from its duty to come up with decent financial management or to continue the development of financial planning, which has been a long-term and vexed exercise in the Parliament. We fought long and hard to move away from one-year budgets. We should not change our approach today.
11:17
I attended a voluntary sector conference just over a month ago, which Johann Lamont also attended. A number of issues arose, of which an obvious one was the sector’s enormous potential. I will be fair and say that there was a degree of praise for Jim Mather and for some of what the Scottish Government has done for the third sector, but the main message that I and perhaps other people took away from the conference was that, whatever else voluntary sector organisations wanted, they did not want to be given one-year budgets and spending plans. The sector was looking for three or four-year plans, because such plans are critical to the running of organisations.
In the past seven or eight years I have probably been to a dozen or so voluntary sector hustings and conferences with people from across the political spectrum, and the issue has come up at every meeting. At every conference or hustings, representatives from every party, including the SNP, have expressed the view that one-year funding is not acceptable and that organisations have to be put on a more sustainable footing, through three or four-year funding.
The issue is not new. In the late 1990s I was a member of a commission that the SCVO set up under the chairmanship of Arnold Kemp, the core recommendation of which was three-year budgeting. The recommendation was followed through for local government and voluntary sector organisations during the past decade. The reality for voluntary sector organisations is that that is being undone by the Government.
I thank the member for his intervention. I do not intend to talk about the voluntary sector for my entire speech but I wanted to use that example to demonstrate that parties across the political spectrum, including the current Government party, agree that three or four-year funding, not one-year funding, is the right solution.
If that is right for the voluntary sector it must follow that it is correct for the Scottish Government’s and the Parliament’s budget. If we go back to first principles, I think that members of all parties agree—although SNP members might not want to admit it today—that the three or four-year funding approach is superior to the provision of figures for only one year.
All the Opposition parties are united behind the motion, and, more important, there is a united group outside the Parliament. Organisation after organisation has put its name to the principle that there ought to be figures for three or four years. I challenge Mr Swinney to tell us who is saying to him that one-year budgets are superior. Are the chief executives of local authorities telling him that they prefer one-year figures and do not want three-year figures? Are health boards telling him that they do not want indicative figures for three or four years and would rather have figures for one year? Are the police and fire services telling him the same thing? Is anyone out there saying to the cabinet secretary, “We prefer one-year figures; we do not want three or four-year figures”?
Throughout the debate we have heard that south of the border there are departmental figures up to 2014-15. In Wales there are figures for more than one year. We heard recently about Northern Ireland, too. If the devolved Administrations in Wales and Northern Ireland can do it, why cannot we do it?
The first reason that we heard for not providing figures for more than one year was that the 2007-08 budget in advance of the election contained figures for only one year. However, the critical difference between then and now is that at that time there was no UK spending review. It would have been unreasonable to have forced the then finance minister to produce a three-year budget, when he had figures for only one year. That is why the Conservatives could not support an attempt to force the Scottish Government to produce a budget in advance of the comprehensive spending review.
Secondly, we heard that the figures could change. That argument has been fairly well rebutted. It is true every year that the figures could change. For example, there are the autumn revisions south of the border, as Jeremy Purvis said. Chief executives of organisations and people who run charity and voluntary sector organisations understand that. They also understand that there will be an election next year and that there is potential for change in that context.
Thirdly, we heard that it would be foolhardy to provide figures for three years when the Scottish Government wants to reform public services. I say again, if Wales, Northern Ireland and England can provide such figures, why cannot the cabinet secretary do so? Is he seriously suggesting that there will be no reform of public services in Wales or Northern Ireland? The SNP has levelled criticism at the coalition Government, but it cannot suggest that reform of public services is not taking place south of the border. An enormous amount of reform is taking place, so if we can have three or four-year figures south of the border, why cannot we have them for Scotland?
11:23
I will reassure Richard Baker about the budget allocations for local government. As part of the financial arrangements that were agreed with the leadership of COSLA and confirmed by ACPOS, as I think that Mr Maxwell pointed out at yesterday’s meeting of the Justice Committee, there is sufficient funding in the budget settlement to maintain police numbers throughout 2011-12 at at least 17,234, which is of course 1,000 more officers than there were when the Government came into office in 2007. The funding arrangements for that are provided in the financial settlement. I hope that that gives Mr Baker the reassurance that he sought.
Will the cabinet secretary clarify how much money has been allocated to local authorities for that purpose? I presume that it is an amount far greater than the £31 million that is being cut from the Government grant for police forces.
The point is to be explained with reference to the reduction in local authority budgets, which is a reduction in revenue support of 2.6 per cent. That is the approach that is taken with police authorities. The foundation is the deal with local government, which provides the funding for maintaining police numbers at 1,000 more than when we came into office.
At yesterday’s meeting of the Justice Committee, ACPOS accepted the importance of police authorities delivering efficiencies. No part of the public sector should and will be immune from the delivery of efficiencies.
Robert Brown asked where the third sector fits into much of our planning and referred to the compacts that exist with local authorities. The Government has intensified the focus on the work of community planning partnerships, in which we bring together public sector organisations at local level—health boards, local authorities, the enterprise agencies, fire and rescue authorities and the police—and the third sector. The partnerships give the third sector an opportunity to be part of the identification of solutions to some of the challenges that we face in public service delivery at local level. The Government has taken that route, which gives the third sector a strong role to perform in what the Government wants it to do. Gavin Brown made the fair point that the Government has made efforts to ensure that the sector has a greater role in the delivery of public services.
I applaud any moves to give the third sector equality of respect. However, if there is no background framework and local authorities must operate on one-year funding packages, with no indication of funding in future years, it is very difficult for them and the voluntary sector to produce the outcomes that Mr Swinney and I seek.
As I said in my opening speech, this will not be the first year in which the third sector has had to operate with a one-year budget allocation: it had to do so in 2010-11 and in 2007-08. This is not an unprecedented situation, as has been suggested.
In responding to Patrick Harvie’s and Ross Finnie’s remarks, I will address the difference of view that exists between the Government and those who argue for a three-year budget. Mr Finnie said that the Christie commission could make profound recommendations, and it will have to do so. The question that underpins the handling of the issue is, what is the most effective method of enabling those profound recommendations about how public services should be organised to be pursued? Is the process helped by structuring an expectation in public organisations of the resources that they will have at their disposal, which will make it much more difficult to unpick and realign spending to meet the commission’s profound recommendations, or should we have the debate about the profound recommendations before setting out the numbers? That is the difference of view that exists.
Will the Government provide the Christie commission with budgetary information for more than the coming year?
The commission will have at its disposal the spending settlements for the remaining three years of the comprehensive spending review period, so of course it will have such information. The question is, does it help the process of reform if we set out and demarcate the spending levels and approaches of every public sector body? Does doing that make it easier to elicit the reform that will have to happen to restructure public services? That is the nub of Mr Finnie’s point and of the debate. Labour members have argued that we must provide the budget numbers to give everyone absolute certainty. If we provide absolute certainty on all budgets, we will lock out the reform that is essential.
Does that argument hold up in relation to the 2012-13 budget? If the Christie commission reports in June, the new Parliament will get only five minutes to debate its recommendations before the summer recess. Is the cabinet secretary saying that, between September, when members return, and the budget process for 2012-13, political agreement will be reached on which of the Christie recommendations will be implemented and on what that means for the budget? If not, why can he not publish the 2012-13 budget now?
The Christie commission will report in June. The fundamental point that I am making is that the Administration at that time will be able to set out priorities over a three-year period to deliver the reform that is recommended.
Michael McMahon made a point about the local government deal and criticised the contents of that arrangement. I quote to him the president of COSLA, who said:
“I know within my heart of hearts that I have put the best financial package with the maximum flexibility on the table for COSLA’s member councils.”
That is a fair reflection of the settlement.
Will the cabinet secretary take an intervention?
I am about to close.
He does not want to take my response.
Mr McMahon knows how generous I am at giving way in debates. If he will forgive me, that was a cheap point.
We have had an entire debate about process, but we have not heard a word about what would be different under the Labour Party. We have heard Jackie Baillie complain that the health service is not getting enough money, Michael McMahon complain that the local government system is not getting enough money and Mr McNulty complain that universities are not getting enough money. I think that that is about all—[Interruption.] How could I forget Mr Baker? He complained that the police are not getting enough money.
I say respectfully to Labour members that I have delivered a balanced budget for the Parliament to consider. It is up to all other members to engage with the budget process—to stop dodging reality and ducking the issues, and to start engaging in the debate about how we will deal with the sharpest reduction in public spending with which any finance minister has had to wrestle. I have addressed that challenge.
11:31
I am pleased to speak in support of the Labour motion. I find myself in the unusual position of speaking on behalf of a united Opposition, probably for the first time. It shows how badly the Government is doing if the Opposition is united against it on so many occasions.
There is no doubt that this week, during which his judgment has been called into question, has been a bad one for John Swinney. Equally, it must be said that the problems are all of his own making. It is all so different from those heady days, three years ago, when he was promising to do things so differently. He certainly has done things differently but, sadly for Scotland, not necessarily for the better. Promises made in manifestos became promises broken in power. The trail from one of those—the promise to introduce a local income tax—led straight to Mr Swinney’s office door.
We have all grown tired of the litany of excuses. We heard them again yesterday, but at least on that occasion John Swinney finally had the good grace to apologise to the Parliament for his failure to inform MSPs about his decisions regarding the operation of the single variable rate. However, today we are looking at another of his poor decisions—the decision to present only a one-year budget for 2011-12.
I am sure that Mr Swinney could have asked Andrew Goudie, the chief economist, and his talented staff to produce a detailed one-year budget, along with indicative figures for the following years, if he had wanted to. The problem is that he did not want to. As we said last week, he decided to put the political problems of the SNP before the political and financial issues facing Scotland.
It may come as a surprise to SNP members, but with government comes responsibility. On more than one occasion, the SNP has not shown that. On the day of the UK budget, we waited with bated breath, but Mr Swinney had already set up the independent budget review team. We tried to encourage debate through our Parliament’s committee system, but again we were mothballed—to use the current phraseology. We tried to encourage a three-year budget as something beneficial for Scotland, alongside the comprehensive spending review, even after the independent budget review team reported. What we got was an announcement about what Mr Swinney would not do, rather than about what he would do. I fear for the Christie commission and its detailed outcomes.
Through the summer, my colleague Andy Kerr and I called on Mr Swinney to bring forward his budget proposals so that all parties in this Parliament of minorities could have an input, but we were told that we would have to wait for the comprehensive spending review so that Mr Swinney would know exactly how much money he had at his disposal. That was despite Dr Goudie and his team having reported—very accurately—on what the outcome of the comprehensive spending review might be. Instead of providing figures for at least three years, which everyone now understands to be the sensible approach, Mr Swinney has again ducked his responsibilities to the Scottish people and has provided numbers for only one year. He might think that it is politically astute to bypass the hard decisions in areas such as public sector reform by fobbing them off to a series of commissions that will not report until after May, but the Scottish electorate are not that stupid.
The SNP knows exactly how much money the Scottish Government has for the next three years, so why can it not give families, local authorities, the health service, the business community, the third sector and other public bodies the same certainty? We all need to be able to plan ahead. As we have heard in the debate, it is not just the Opposition parties that are calling for three-year plans; it is the whole of civic society in Scotland. My colleague Jackie Baillie outlined why decision making is better when those in the public sector, particularly in the national health service, can plan ahead.
Mr Swinney mentioned the report on preventative spending that the Finance Committee is working on. How can the proposals that flow from that report be taken up without our knowing what the forward budget proposals are for key areas?
Michael McMahon detailed the difficulties that face local government with its one-year budget. Mr Swinney has quoted the president of COSLA. I could quote the Labour leaders of Glasgow City Council or North Lanarkshire Council, who both disagree with the president of COSLA.
Richard Baker detailed the problems that face the police service and spoke about how civilian workers will lose their jobs in order to keep SNP promises about front-line officers. Des McNulty highlighted the critical problems facing Scotland’s education sector—in schools, universities and colleges.
I take it from those remarks that Mr Whitton does not support the maintenance of police numbers at more than 17,234.
I was highlighting the fact that, as a consequence of Mr Swinney’s actions, civilian workers are being made redundant.
Derek Brownlee detailed the uncertainty that is being caused in various parts of the public sector, and he told Mr Swinney that there is no excuse for not setting out indicative figures. Jeremy Purvis made the obvious point—which SNP members failed to grasp—that the Opposition parties require the Government of the day to bring forward its plans so that we can hold it to account.
As I said, it is not just here in the Parliament that people are calling for three-year budget proposals. Outside the Parliament, a number of organisations are also calling for that. Pauline McNeill pointed that out.
It was one of the SNP’s own ministers who gave the game away. In one of his growing number of television performances, Alex Neil informed the nation that the SNP had all the information that it needed to produce a forward budget covering the next three years, but it was just not going to do so until after next May’s election. Bob Doris, Alex Neil’s bag carrier, repeated that this morning.
I believe that the SNP will pay a price at the ballot box next year for treating the electorate with so little respect. It might think that it has done enough by maintaining the council tax freeze, but all that that does is to hide cuts and job losses behind smokescreens and mirrors. Where is the SNP’s courage to take the hard decisions? We all know that it will not be easy. The public know that it will not be easy, but they want to know what lies ahead in the next few years, not just the next few weeks.
Mr Whitton is talking about detail. Could he at least give us the figure for how much he wants to raise the council tax by?
That is a favourite of Mr FitzPatrick, and it adds nothing at all to this morning’s debate.
Even in Ireland, where the problems are greater than ours, the Government yesterday came up with a four-year package. As we have heard, the Assemblies in Northern Ireland and Wales have done likewise. The question must be asked: why not here in Scotland?
There is still time for Mr Swinney and his team to do the right thing and come up with indicative figures covering the CSR period by the time of the stage 1 debate at the end of January. We and the other parties would be happy to help him do so. If he refuses to do that, he will clearly stand accused of putting party before country.
As our motion says, we need a budget for Scotland’s people, and we call on Mr Swinney to produce one. Scotland certainly deserves better than what is now before us.