Chamber and committees

Can you give us a flavour of what the differential in timings for your business customers and your citizen customers might be?

The threat to the refinery is equally a threat to the chemical cluster and a threat to Scotland’s economic economy. Given the recent award of Scottish Enterprise funding to Ineos for the green freeport initiative, what further incentives might be provided through the Forth green freeport, or directly to the cluster, to maximise long-term financial sustainability and enable growth, as outlined in the green industrial strategy?

To ask the Scottish Government how it plans to sustain the economic value of the chemical production sector based around Grangemouth. (S6O-03849)

That line of sight is vital.

Good morning. Thank you for joining us, cabinet secretary. I will pick up on some similar points. We already know that there are concerns that the number of so-called orphan buildings will increase, should disreputable or unethical builders choose to liquidate themselves and re-establish elsewhere. That is a regrettable risk. What is your assessment of whether the introduction of the Scottish building levy could increase the number of orphan buildings? I am not suggesting that the introduction of the levy in and of itself would be the primary trigger, but it might overlay additional financial considerations. Have you considered that?

As we have all said, we will need to wait and see, because the matter is highly complex. There will be uncertainties about risks until the building assessments have been made, and I presume that there will be the same uncertainties about risk elsewhere in the UK, because the assessments have to be carried out.

This is a slightly technical point—and I might not be remotely right. The Chancellor of the Exchequer’s recent change of heart on the fiscal rules will mean that debt will be recast as assets, particularly in relation to investment. Have you given any consideration to what that might mean in relation to whether what might have been seen as debts on a balance sheet, for the UK Government or the Scottish Government, could be metamorphosed into assets?

I am inclined to agree that the £30 million of revenue that it is proposed to raise will probably be too low. Given that we agree that the risks, the uncertainties and, potentially, the costs might be broadly similar, with some regional variations, are you concerned that the issue having had to become a devolved matter has meant that the risk of there being a much bigger bill, with £30 million not being enough, has been passed to the Scottish Government?

I start with a few thoughts on tomorrow’s UK budget. Just as every citizen will be concerned about the sustainability of their own finances, not least pensioners and those in low-income households, the Scottish Government will very quickly have to consider the implications for budget sustainability. Thus far, the omens are slightly mixed. The UK Labour Government made pre-election commitments to protect working people from tax rises, but it is unable to define what it means by a working person.

Leaving aside the confusion that the UK Government has created, I start with a critical consideration of a major policy change that it has trailed: changes to the fiscal rules. The pre-election commitment to stick with the Tories’ fiscal rules has been dumped, at least in part. I welcome the fact that the road to Damascus has been somewhat short. It now seems clear that borrowing for investment is no longer to be considered as debt but rather as asset creation. That could allow for a significant increase in infrastructure investment, which I welcome.

However, that has potentially major implications for the Scottish Government. As we know—and as I have often commented on—under devolution, the Scottish Government has very limited capital borrowing powers. Some have argued that that is to prevent the devolved Government from adding to UK debt. However, if redefining investment as asset creation rather than debt makes sense for the UK, by all logic, the same must surely apply to Scotland. I wonder whether the minister will commit to engaging with the UK Government on the matter.

In June, the Finance and Public Administration Committee launched its call for evidence to inform its pre-budget scrutiny. That has attracted some insightful contributions and, in most cases, support for the Government’s four priority areas. I found the evidence from the Fraser of Allander Institute particularly telling when it argued:

“Ultimately, the most important thing to come from the 2025-26 Scottish Budget will be to what extent the measures that are implemented will reflect these priorities. The priorities are broadly the same as last year—but given that decisions in the 2024-25 Scottish Budget did not necessarily chime with those priorities, a new approach will be needed to ensure that the situation is different this time around.”

Achieving fiscal sustainability while maintaining a focus on key priorities is very challenging but utterly critical. In that regard, I am sympathetic to the submissions from the Royal Society of Edinburgh and the Scottish Chambers of Commerce, which argue that growing the economy is the most important priority, and that it will underpin the ability to address the other three, not least because public finances will grow if the economy grows. It is also a much more effective approach than simply burdening the economy and individuals with more tax hikes. In other words, to my mind, growing the economy will contribute to fiscal sustainability and the pursuit of the Government’s priorities, and there is no sustainable alternative.

I also point out that growing the economy will positively impact the lives of many of those who live and work in Scotland, not least through enhancing employment prospects and household incomes. In some specific areas, there are opportunities to target investment in a manner that supports all four priorities, perhaps the most obvious being investment in new affordable house building.

Of course, there are other matters to take into account to ensure fiscal sustainability, from public sector pay policy, which we have discussed, to tax policy, which has also come up, and I am sure that we will continue to focus on many others in the debate.

Before I conclude, I want to reflect on a further concern that was raised in the evidence from the Scottish Women’s Budget Group and the women’s economic empowerment project, which is about the tackling of barriers to women being able to take on work. Such barriers, such as the inability to access affordable and accessible childcare, inhibit economic growth. The Scottish Government has come out strongly to support women going into work. However, as I have previously argued in the Parliament, we need further sex-based research into the impact of public policy as part of the drive to improve economic policy development.

In summary, enhancing the Scottish Government’s ability to borrow and invest—now reframed as asset creation—and a commitment to the critical priority of growing the economy and sound policy development are all part of achieving fiscal sustainability.

I, too, thank my colleague Emma Roddick for bringing the debate to the chamber, and for her very thoughtful contribution.

While there are a multitude of opportunities with AI, there are clear dangers, and the disruption that AI will cause will put previous revolutions in the shade. In my short remarks, I intend to draw on a few general thoughts from leading AI academics, and explore some implications for professional musicians, as that is a profession that is close to my heart.

First, I draw members’ attention to the letter of 2023 that was signed by more than 30,000 leading brains. The opening paragraph argues:

“Advanced AI could represent a profound change in the history of life on Earth and should be planned for and managed with commensurate care and resources. Unfortunately, this level of planning and management is not happening, even though recent months have seen AI labs locked in an out-of-control race to develop and deploy ever more powerful digital minds that no one—not even their creators—can understand, predict, or reliably control.”

In a recent interview for Time magazine, Professor Max Tegmark, who is a leading expert in AI from Massachusetts Institute of Technology, was asked:

“What is the one thing you wish more people understood about AI?”

He responded by saying:

“The pace of change. AI development is progressing so fast that many experts expect it to outsmart humans at most tasks within a few years. People need to understand that if we don’t act now, it will be too late.”

To what extent, therefore, are we in Scotland aware of, and responding to, the threats of AI? I do not think that we are yet, so I welcome this debate.

It is clear that the answer lies in regulation. At present, we see multiple approaches, such as focusing on diminishing risk, as in the EU; sector-specific approaches; governance and framework principles across various jurisdictions; and even the example of China, which is aligning the opportunities that it sees are offered by AI with its own state interests.

As I said, I will mention some of the threats to musicians from generative AI. It is clear that there is a threat to jobs—for example, for composers. AI is already advanced in writing music for commercial fields such as gaming, particularly background music. It will certainly affect session musicians such as backing singers.

The originality of music could be diminished as AI simply scrapes from existing patterns and trends. Conversely, there are also risks to musicians from AI generating music that sounds similar to that of an artistic creation. That could lead to challenges of copyright infringement, all without the legal test bed of precedent on which to draw.

I draw members’ attention to the latest letter that has been pulled together by UK Music and signed by 10,000 musicians, highlighting concerns about the unlicensed use of creative works to train generative AI, and the fact that the regulation that I mentioned is nowhere to be seen.

The real question, however, is—perhaps arguably—a philosophical one. What is music, and to what extent can it be deemed human? Does AI have the potential to diminish our humanity, and if so, in what ways?

For me personally, music has always been the highest form of human expression, and I fear that AI will reduce authenticity and, with it, our human experience. The creation of music involves the human struggle of self-expression based on life experience. Can we feel the depiction of that struggle through the music? I would argue that we can. AI can, arguably, create more “perfect” music, but it is the imperfection that is part of the authenticity, and our humanity. As we disconnect from that imperfection and authenticity, I fear that we may disconnect from ourselves.

AI is here to stay, so the music sector needs to find ways to incorporate it and place authentic human-led music at the heart of any value proposition. Thankfully, musicians are endlessly creative, and I believe that that creativity will ultimately win through.