Chamber and committees

I tend to disagree, I have to say. We are going to see cuts to services, and we have just had a third year of chaotic in-year budget cuts that are affecting the ability of all services to deliver outcomes for people across the country. By the sounds of things, there will be large increases in council tax. There are consequences to the fiscal framework not being complete. The reality is about whether it gets done, not whether there are meetings going into the diary to discuss it. The situation has gone on for years. The ask is for Government to take a strategic approach to the budget. All the evidence that you have given us indicates that, so far—although I am sure that the diary secretaries are working very hard to get time in diaries—there are not any proposals on the table about anything strategic. Is that not the case?

We are nine weeks out. I understand that the budget that is set at UK Government level will substantially inform what happens afterwards, but the reality is that that will involve percentage points of difference. The Institute for Fiscal Studies has said in recent weeks that the Government should be using this budget strategically to have conversations with local government and other service providers in order to take long-term decisions. I feel that, nine weeks out, if there were strategic decisions to be taken on some of the things that you call for in your document and on what the Government should be clear about—what should be stopped as policy and what the focus should be—that should be the substance of the conversations. Is that the case? Do you think that it will be a strategic budget?

With regard to the submission that you provided to the committee—as the convener said, it is very useful—it seems to me that there is a real frustration with some of the short-term decisions that are being taken. Your submission states:

“Scottish Government policy and spending decisions that run counter to the VHA”—

that is the Verity house agreement—

“such as the council tax freeze and maintaining ... teacher numbers, will prevent councils from achieving better outcomes for their communities.”

That is really about ad hoc, on-the-hoof policy decisions that are taken outwith the cycle of negotiation. Do you have confidence that, this year, we will not see that kind of approach to budgeting from the Government? Is it saying to you that there is a long-term approach?

I see the purpose of this whole process as breaking the short-term view in politics and trying to put things in longer cycles. There has been quite a lot of talk about technocratic bureaucracy, setting targets and trying to bring the state behind a certain set of goals, which I understand, but, inherently, these are political questions. The reason why the system is not working—in the previous session, we took evidence from Oxfam, which said that it is not working at all—is that there is no political commitment to making it work. Is that not right?

Thank you, Lukas.

That is useful. There is also a question about the political coherence of the goals. As much as we have had one governing party in Scotland for 17 years, I do not think that anybody would dispute that we have had a variety of different approaches and, frankly, core beliefs in that time. Some people in the Government do not believe that economic growth is a positive thing at all, while others think that it is the only thing that matters. We have people from the original Administration that was elected in 2007 and which set this out who are now First Minister, while others are saying in the press that Scotland is effectively a third-world nation. How can we put together a long-term process under one Government if it departs so radically in its understanding of the organising principles of its purpose?

We have had a comparatively stable Government in Wales for that long period of time—one party in government—but with ideological coherence across that period, which has not been the case here.

My final question is about whether, if everything is a priority, nothing is a priority and about some of the commentary about how bland the outcomes are. Is it not better to have these technocratic goals set in the non-contestable space? There are things that we know. Climate change is happening, adaptation has to occur and we have to transition. There are no voices in Parliament that disagree with those things. I understand that there are voices on the fringes of politics that disagree, but in the core those things are non-contestable.

Some of the issues that are within those things, particularly the role of economic growth and whether we should have a wellbeing approach versus something that is driven around GDP, is clearly contested around the Cabinet table, let alone within Parliament. How can we have a long-term goal that is based on an ideological framework that the Deputy First Minister, members of the Cabinet and the First Minister do not agree on?

To be fair, convener, we were not in power at that time. It is a recognisable point, but we are talking about the operation of the framework in Scotland under the Government.

I want to ask about what we should do in the tax area, which Lewis Ryder-Jones and Allan Faulds have touched on.

Lewis, you said that we have not yet reached the limits of where we should go on tax, but the Scottish Fiscal Commission has told us that, in relation to the top rate of tax, we are looking at behavioural effects of around 90 per cent. Off the top of my head, I think that we are talking about a reduction in the sum that the Cabinet Secretary for Finance and Local Government was supposed to have available to spend as a result of the last year’s tax increases from about £80 million or £90 million to £8 million. I do not see what we can do in that area to realise more of that money.

You mentioned middle-income earners and increasing the revenue from them. We know that most of the money that has been raised in recent years has come from middle-income earners because of fiscal drag and people being pulled into the upper tax brackets. Those are people who earn between £40,000 and £50,000. At the moment, they do not feel rich—far from it—because prices are increasing and so on. I think that you recognise that. The committee is wrestling with the issue of how we might realise more of that money. Could you say a bit more about how you think that that could be done?

I am interested in the stability issue in relation to longer-term investment, where we are getting the money from and how it might be spent. Public Health Scotland says in its submission that, in the current climate, there is

“a tendency towards more reactive, short-term responses.”

We are in the third year of emergency in-year budget cuts from the finance secretary and of very short-term decisions being taken within the financial year. Can any of our witnesses talk about the challenges that that creates in the organisations that they represent, whether in the health service or for users of services more generally?