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Chamber and committees

Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 30 April 2025
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Displaying 788 contributions

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Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

I did not write down the numbers that you mentioned in talking about the Treasury figures and your estimate, but you said that approximately 40 per cent of the ENICs liabilities will have to be met from within portfolios. How achievable is that, and what sorts of measures will the departments take to meet those costs?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

A criticism of the budget and of the Government’s approach and strategy is that we are hearing a lot of warm words—we heard a lot of warm words yesterday about the summit—but we are not seeing hard numbers. I question the scale of the ambition around public sector pay and public sector reform. Audit Scotland referred to your concept of “rightsizing” the workforce, which is something that you talk about often. However, as I suspect would be the case in the private sector, for that to be meaningful and to deliver best value, you will have to put numbers to it. In percentage terms, how much smaller do you anticipate the public sector workforce being in future years? In monetary terms, how much are you targeting to save?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

Good morning, cabinet secretary. I want to start my questions by looking at tax. It has been confirmed that there will be no change to income tax rates in the budget, although it will freeze the upper rate thresholds, which is effectively a tax rise for many Scots. Why, at this point in time, has the Government decided not to raise tax rates, which, to a greater or lesser extent, has been your policy in recent budgets?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

Do you consider that a more complex system has higher compliance costs and that those are passed on to businesses and individual taxpayers?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

In the past, HMRC has expressed concern in relation to your policy and whether people are trying to find legitimate ways to reduce their tax bill, including individuals incorporating. The Chartered Institute of Taxation’s Scottish technical committee has said that the problem could become more acute as a result of the national insurance increases that have been levied on employers in the recent UK budget, which could lead to false self-employment and employers trying to get people off their books or out of PAYE, which could result in more people incorporating. In those circumstances, the Scottish Government loses that tax revenue. How concerned are you that the combination of the national insurance increase and your legacy tax policies could result in the Government losing revenues through personal incorporation, for example?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

You referred to the sum of £30 million for the invest to save fund. Do you have a target for the savings that you hope that that will bring in? Is it a factor of five or something like that?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

You have not set a target for what the £30 million fund will bring in.

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

The committee welcomed the strategy, but it was a cautious welcome. My concern, and the concern of a number of organisations that fed into the process, is that the Scottish income tax system, in particular, is still unduly complex, with perhaps too many rates. What consideration are you giving to further simplifying the system—not necessarily reducing rates but simplifying and perhaps removing rates of income tax within the Scottish tax landscape?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

It appears that there is a debate within your party and the parties that are supporting the budget—I do not think that it will be a surprise when I say for the record that the Conservatives will not support the budget—about what happens next on tax, particularly for higher earners. In determining not to raise tax rates, what modelling analysis did the Scottish Government undertake in order to come to that position? Will you share that analysis with the committee?

Finance and Public Administration Committee

Budget Scrutiny 2025-26

Meeting date: 18 February 2025

Craig Hoy

As part of your strategy, will you take cognisance of comments from organisations such as Scottish Financial Enterprise, which have real concerns about the direction of travel and, in particular, the behavioural responses to the tax measures that you have introduced in recent years? What further investigations and work will you do on behavioural responses through the tax strategy?