Chamber and committees

Yes, potentially. That is interesting, and, again, we could provide information on this to the committee. The devolved Administrations undertook some analysis on the assumptions that the Treasury makes about the risk of exposure when borrowing, for example. Treasury assumptions are always for the maximum level of risk and volatility, yet we would never make such decisions. However, due to those assumptions, the Treasury’s approach is that we cannot have additional flexibilities and powers because that would affect UK Government borrowing and, in essence, distort or put additional risk into its plans and planning.

However, we have had a very interesting debate with the Treasury about its assumptions being at the worst-case end, when no Government would do something at that level of risk. The Treasury has been assuming a high level of risk, but the devolved Administrations said that, actually, we would take decisions at a lower level of risk. There is much less risk involved than the Treasury has been assuming. We thought that that might be a way in to those additional flexibilities, particularly at the end of the financial year, but, so far, we have not managed to persuade the Treasury. Jennie Barugh has been closer to the detail, so perhaps she can add to that.

Richard, do you want to come in on this?

I accept that, because all the things that we have talked about previously—pressures, demographics and pay—require all our public services to transform the way in which they do things to meet those challenges. Local government is no exception to that.

One of the reasons why I have protected the general revenue grant and the £253 million is that local government will say that, in order to transform and do things differently, it needs maximum flexibility rather than ring-fenced funds. We have baselined a lot of funding to remove ring fencing, and we have put that money into general revenue to give maximum flexibility.

We have to have conversations about shared services, and some parts of local government are already having those conversations. We are looking at corporate services, sharing services and the removal of boundaries across the public sector. We talked earlier about public bodies and how there will be fewer of them and they will look different.

Local government also needs to look at how it delivers its services. The three Ayrshire councils are in advanced discussions about how they can share more services, particularly some back-office functions. I am hopeful that other local authorities will likewise look at how they can work beyond the boundaries of their constituent parts.

We also need to look at digital roll-out in local government. Again, some local authorities are quite far down the road on automation and the way in which the public access services, but others are not so much.

I am well aware of the issues that you are referring to. First, as you have alluded to, all roads lead to the Home Office on that issue in relation to the policy—

From analysis of the tackling child poverty delivery plans, we know that the policy that has resulted in the biggest move towards meeting our statutory targets on child poverty is the Scottish child payment—it has resulted in the biggest shift by a country mile.

The reason why Scotland is the only part of the UK where child poverty rates are falling is, primarily, the Scottish child payment. That is why we are increasing the payment by inflation, and we are focusing on the under-ones because we know that there are additional costs for them.

The chief economist did an analysis of benefit spend in local communities, which I am sure I have referred to previously. There is an economic impact on local shops and services in communities, because people tend to spend locally.

A lot of rigorous work has been done to find out which of the employability programmes work. It can take a while for someone who is particularly far from the labour market to get into work, and there is sometimes a higher drop-out rate because of the challenges.

We are focusing on wraparound support or what the First Minister calls whole-family support. That includes support for employability not just in relation to skills and training but in relation to childcare and transport. What are the barriers that prevent someone from successfully getting a job and then maintaining that job, particularly in the first few months? We are trying to provide more bespoke support.

The programme that the colleges will run will be a really good addition. Colleges Scotland provided a very impressive and persuasive proposal for supporting people back into work. Some people will find a college a less intimidating environment in which to take steps back into work. Over and above the £70 million of funding, £8 million is being provided to colleges to deliver that programme, which will be analysed and evaluated.

A lot of work is being done in this space, and it is important to keep it all under review so that we know what is working best and what is perhaps not working so well.

We do. One reason why I referred to the average figure of £480 for those in the bottom half of the income spread is that that figure includes social security support as well as the benefit of lower income tax.

However, you are right to point to people in Scotland having lower water and council tax bills. Earlier, we talked about the position on council tax, but council tax for an average band D property in Scotland is still markedly lower than it would be south of the border. Therefore, we have to look at things in the round.

In addition, if you have kids at university, you know the difference—my goodness. South of the border, people are now paying more than £10,000 in tuition fees.

Oh, I slightly exaggerated—families have to pay almost £10,000 for each child. That is not the case in Scotland. That is part of the social contract.

We need to consider things in the round. I see parties proposing that we embark on billions of pounds of tax cuts without having any plan for where the money will come from. The money has to come from somewhere, and it has to come from somewhere from 1 April. It cannot be something that might happen further down the line; parties need to set out in black and white where the money will come from. Such proposals have been short in coming.

I think that we have covered a lot of areas. We will follow up with the additional information that I have promised to provide to the committee as soon as we can. I thank committee members for their time.

You will appreciate that it is sometimes very slow for some of the projects—given that they are larger projects, some of which are very complex, particularly those in the health space—

I accept that some of the in-year transfers make it difficult. We have tried to be as transparent as possible and have explained why some of the funding sits elsewhere. We are providing more than £325.5 million of funding for the enterprise agencies, and they receive additional funding from the Scottish Government in the ABR and spring budget revision. I understand your point, but the funding is to deliver specific projects and programmes. It is difficult to compare figures from the 2024-25 outturn, 2025-26 ABR and 2026-27 budget because of the in-year transfers.

I think that you started off by saying that progress is being made on transparency and improvement. There is always more to do, but I guess that there is always a tension when portfolio holders—cabinet secretaries who hold portfolios—wish to make changes to programmes. Once money has been transferred and baselined, it is very difficult for them to do so.