Chamber and committees

You have set out what I thought, and very clearly. I suppose the point that I am making is that there is a cost to the inefficiency. If you were working in a law firm, you would itemise every hour to say what goes to this client and what goes to that client. Have you ever considered collecting the cost of inefficiency as fiscal events occur, and of late notification? A number being put on that inefficiency could very well be quite compelling.

I will watch that with interest.

My last point comes back to a question that I previously asked you about police pensions and the extent to which the increase in them—and, therefore, provision for them—came about a result of Covid-19. I thank you for your reply, in which I think you pointed out—and I am paraphrasing here—that that was not due to Covid-19 but was the result of the move from a final salary to a career average pension scheme. The legal challenge in that respect will also apply to other public sector professionals such as teachers, because they face the same issue, but the fact is that we have seen a difference with regard to the rate at which police officers are retiring. As a result, the change to the provision—compared with that of, say, teachers—was not necessarily entirely due to the change to the police’s pension arrangements, given that it did not equally apply to teachers. Do you have any reflections on that?

You are correctly introducing another complexity for the bill, but that is good because that is what we want to tease out. Have we got the data to draw on to arrive at some of these decisions? I am not sure what data your members will routinely gather and submit as part of the existing processes that tease out all the different areas that the Scottish Government will have.

Maybe it does. I am not trying to get to any slam dunk; I am genuinely trying to understand. You have given me more helpful insight, although I suspect that I have further to go to bottom out some of this stuff. Thank you.

Thank you.

I will finish by noting some of the examples that you have given and pointing out that such additional post-Covid sums were exceptional—I think that we all appreciate that. Now that, with the recent changes, we have a more bedded-down fiscal framework, we have actually baked in some of these inefficiencies, and we need to try to understand what they might look like.

I have one other question that follows on from that. In reality, to what extent will the complexities, uncertainties and inefficiencies in the Scottish and UK Governments’ fiscal framework be reflected in the fiscal framework that is developed for local councils through the Verity house agreement? In other words, will they, at an even deeper level than might have been the case before, be saying, “This is no use to us, because it doesn’t allow us to plan”? Do you expect that what you as a Government are dealing with will, in effect, be replicated in that way?

Will the member give way on that point?

There are clearly financial challenges in further education, and across the entire Scottish budget. However, has the minister heard any calls from Tory and Labour MSPs alike for an increase in public services and an end to austerity? I know that I have not.

The cabinet secretary stated yesterday:

“Ultimately, independence would enable Scotland to determine the kind of state it wants to be on the world stage.”

I agree and, therefore, welcome the debate and the paper that the Government published yesterday. I will further develop some considerations that I will proffer as a constructive contribution.

I will start by consideration of an independent Scotland as a good global citizen that has a welcome commitment to overseas development and to meeting the UN target of 0.7 per cent of gross national income being spent on official development assistance. However, that, in and of itself, will not mean that we are playing our full part in tackling global poverty. Official development assistance is a necessary, but not sufficient, contribution.

As was pointed out in an ActionAid report from some years ago—I think that it was in 2016—international taxation arrangements via what are called double taxation treaties are depriving many developing countries of vital taxation revenues—not least from global corporations. I know from our time together at Westminster that the cabinet secretary is aware of the issue, because it was the subject of a private member’s bill by one of our parliamentary colleagues.

One estimate has suggested that creating more equitable tax treaties would do more for the funding of African states than the entirety of foreign aid funding. Nevertheless, even with the minimum that is set out in the document, which would initially honour existing double taxation treaties that would be inherited from the UK on day 1 of independence, that would subsequently involve scrutiny of a large number of treaties, which could bring opportunities to enhance our global citizenship. Such treaties need to be updated regularly in order to ensure that they reflect current economic conditions and fairness between parties.

For example, the latest versions of treaties with Ireland and France were agreed in 2019, with the USA in 2021 and with Germany in 2022. However, the UK has not updated the treaty with well-known tax haven, the Cayman Islands, since 2011. Questions need to be asked about why. Tax treaties have played a part in the most well-known cases of aggressive tax planning by international corporations, and they often ensure that money flows untaxed from poor countries to rich countries.

Treaties with many developing countries have also not been updated for too long. The treaty with Ghana, for example, is a 2006 version that was drawn from the Bangladesh treaty of 1961. I suggest that, ultimately, Scotland as an independent country could do much better. We should bear in mind the view of the International Monetary Fund—that use of tax-treaty networks to reduce tax payments is a major issue for many developing countries.

I will move on. I am pleased to see such a strong focus on having a feminist foreign policy that includes specific reference to protecting the rights of women and girls internationally. As we know from the current conflicts in Ukraine and Gaza, often innocent women and children pay the highest of prices in terms of death and physical injury. However, there is evidence to suggest that post-conflict traumatised countries rely especially heavily on women to rebuild homes and communities, but are often left to do so with insufficient resources. That is an area in which Scotland could play a particularly important role by channelling support through funding, expertise and capacity building. As one recent report on Ukraine pointed out, there is a huge need to develop trauma-informed education practice, and Scotland has notable world-class expertise to contribute to that.

I also welcome the commitment to rejoining the EU and to enhancing human rights and democracy. However, even under the restrictions of devolution, we can be more ambitious. In the coming days, I will be speaking in Malta, which was the home of the remarkable journalist and campaigner against corruption, Daphne Caruana Galizia, who was assassinated by a car bomb on 16 October 2017. When she died, she was the subject of 48 lawsuits that were designed to silence her by people who are rich, powerful and corrupt.

The campaign for Daphne’s law to protect people who are engaged in exposing corruption and human rights violations has come to fruition partly through the publication of an EU directive on 20 February, just a few weeks ago. It is an area in which Scotland could act in concert with the EU to bring in our own legislation and to protect people who would expose corruption and human rights violations. In that matter, we do not need to wait for independence, and it would be a small step on our path to being an active and good global citizen right now.

I congratulate the Government on the paper and would be grateful if the minister could confirm that the Government will consider the issues of double taxation treaties and adoption in Scotland of an equivalent to Daphne’s law.

The cabinet secretary has correctly highlighted the cut to capital expenditure by the UK Government. There is a sense now that people are understanding the real impact of that cut on people’s lives. Can the cabinet secretary give any further insight into the discussions with the UK Government on emphasising the critical impact of the cut in the Scottish Government’s capital expenditure budget?