Chamber and committees

You have illustrated that perfectly.

What do you all think about establishing the offset of taxes as a principle? I accept what is being said about the relatively small number of Scottish taxes, but is there merit in the principle that one tax can be used to offset another, on the basis that we can anticipate further taxes being devolved in the future?

How did I know that that comment was going to come up? Thank you, convener. [Laughter.]

I want to ask about a couple of interrelated areas. The previous panel expressed some concern about offset—or set-off, as I think you describe it—and called it heavy handed. The point that I made to them was that a principled approach is surely being established in anticipation of further taxes being devolved in order to ensure that, where people owe tax, we are able to claw it back. Am I correct in that assumption?

Thank you.

Good morning, everybody. Quite a few things that I was going to raise have been picked up, so I will be quick.

I return to section 59 of part 2, which is on “ancillary provision”. Eric, I think that it was you who said in your submission that

“The ability of the executive to grant itself unfettered powers which might impose any further obligations on taxpayers must be contained within primary legislation

”.

Would a finance bill alleviate your concern in that respect?

However, part of the scrutiny of the introduction of further taxes would be around the consideration of the detail and the complexity of offsetting with a further basket of taxes, would it not?

That is me. Everything else has been covered.

I think that the Law Society said, “Yes, but other taxes might not align directly.” That is true, but I suppose that it cannot be beyond the wit of you and the Parliament to design legislation that takes account of that. Would a finance bill allow for the sort of scrutiny that you would want as you continue with the offsetting approach?

Do Justine Riccomini or Eric Brown have any further comments about the principle, as opposed to its

enaction?

Before I start, I will make the comment that I wanted to make when I tried to intervene on Mr Marra. I recently obtained an insurance quote, and one of the companies asked whether I could confirm that my house is no nearer than 260m to any watercourse, which, to give a sense of the distance, is a very good drive and a 7-iron. I suggest that that is the shape of things to come.

I speak today in the debate as the constituency MSP for Falkirk East. That includes Grangemouth, so I reference the vital Grangemouth flood protection scheme, which is the biggest project of its kind to be embarked on. Its progress, process and outcomes will have a far-reaching impact on other flood prevention programmes. I certainly do not underestimate the scale of the challenge that we face. I note the efforts, with thanks, of Jacobs, Falkirk Council and other key stakeholders thus far. The estimated benefit involves 2,760 residential properties, 1,200 non-residential properties, 6,025 people and 23km of roads.

As we have seen, adverse weather events are increasing, and the impact of not doing something is incalculable, given the importance of the location to Scotland’s gross domestic product. As the cabinet secretary notes, and I quote from a letter that I received from her in January this year,

“The GFPS is exceptional in terms of scale and financial cost. It is the largest flood scheme ever proposed in Scotland, with a current upper cost estimate of £650 million.”

It is also worth noting that the wider coastal management strategy and modelling for fluvial events is undoubtedly linked to whatever is designed at Grangemouth. Therefore, certainty and progression are necessary not only for Falkirk East residents but for neighbouring local authorities.

A number of consultation events have been held. In January this year, Falkirk Council agreed to move to the next step in the form of scheme notification. After that, the outline business case will be developed.

However, the funding elephant remains in the room. The current funding status, whereby the Scottish Government will bear 80 per cent of the cost of the programme and the council 20 per cent, seems to be unachievable by either party. The cabinet secretary rightly states that, for the Scottish Government to utilise the entire annual local government general capital grant is simply not feasible. Therefore, I understand the rationale for removing the scheme from the current cycle of funding and allowing the Scottish Government to make progress with a variety of other schemes.

Various funding models and options have been developed by the council, and the cabinet secretary has asked her officials to pursue a task force model and engage a team Scotland approach. That is welcome, but serious conversations need to be had about funding to allow for clarity in the staging. In a previous life, I was a programme manager, and I was always aware that, without a clear line of sight for phases, considerable sums of money can in effect be wasted. It is not unreasonable to assume that the pathway to completion might need to be elongated and reworked, and that it will inevitably turn out to be much more expensive, but clarity needs to be found for the initial stages and on-going dialogue for subsequent stages.

I am entirely sympathetic to the predicament that we all find ourselves in. I note, thankfully, that the Scottish Government has no plans to claw back the council’s £4.5 million underspend for the scheme, although I understand that, as yet, there is no clarity on what conditions might be attached, if any. To that end, I am grateful to the cabinet secretary for agreeing to meet me to discuss the GFPS in the near future.

My final point relates to the other stakeholders who have an interest in the area, including RSPB Scotland, the climate Forth project, Buglife Scotland and NatureScot. It will be vital to have proper co-design and a full engagement process on plans for mitigation and biodiversity compensation, and to ensure that any environmentally negative consequences of the GFPS are considered. The last thing that anyone wants to see are objections from those who should be partners in the scheme, and I hope for their full involvement.