Chamber and committees

Those questions are all in budget territory. I stress that the negotiation with local government is about a package, so I do not want to pre-empt some of the discussions. There will be trade-offs and compromise here and there around what the final landing spot looks like. The council tax is just one element, so it would only be fair to keep that in the budget negotiation space.

That is what I have been alluding to. I raised that issue at the FISC meeting—a lot of issues were raised, and that was another one. Again, everybody was saying the same thing: we need investment in public services, so we need certainty and stability around our resource budgets, and we absolutely need to not cut capital, because it is investment in infrastructure that will help to grow the economy and deliver the infrastructure that we need. As I think you said earlier, that is about day-to-day maintenance as well as big projects, but it is hard to do all of that with reducing capital budgets. We all made the same point at the FISC meeting. We did not get any confirmation one way or the other, but we have landed the message, and I think that others are doing likewise.

I stand corrected—3,000. Clearly, we need to get those turned around. What is the issue? Is it a personnel issue? I know that there was a Covid lag and a load of work was stuck because the repairs could not be done. Are we through that lag yet, or is it still having an impact? Is it a capital issue? What are the blockers? How can we help to move through that situation? If you extrapolate the 3,000 Edinburgh voids to the whole of Scotland, that is a rich seam. We could turn the situation around. There are also acquisitions and the repurposing of empty buildings, which some local authorities have been really good at doing.

We just need to get a bit of pace on all that. It is not one solution. Capital and revenue come to bear here. I stress again that I am really keen to find solutions that can help move some of that through a bit more quickly.

The fiscal framework is designed to move us forward and get away from what had been an annual ask from COSLA that set the scene for what was never going to be a quantum that met that demand. It was a joint endeavour to get a more constructive discussion.

There are complexities in the fiscal framework. I do not know how much Katie Hagmann spoke about rules-based funding. We have been exploring that, and Ellen Leaver or Ian Storrie can tell you a lot more about the detail of the discussions at official level. It sounds like a simple thing, but it is not without its challenges. We need to test some of that thinking, and we may look at shadow components of things over 2025-26 before coming to a fixed position.

I will give you one complexity. If rules-based funding landed at a place where the rules were met and the funding was agreed, what would happen if there were events during the financial year that caused local government to turn to the Scottish Government? Where would that sit in a rules-based framework?

I think that local government is very cognisant of the ups and downs and of the fact that things are not always neatly packaged at the start of the financial year. Events happen and they need to be responded to. I do not know whether Ian Storrie or Ellen Leaver wants to come in.

If we can get to a position in which the UK Government provides certainty on multiyear funding—we are being told that that is the aspiration—and I can see what those multiyear envelopes will be like, of course I would want to work with local government to deliver multiyear funding for it. I would be delighted to be able to do so, because I know that that would open up a whole range of opportunities, some of which I mentioned earlier.

I recognise that that is an issue for local government and COSLA, and they raise it with me regularly. However, I also note that we have made significant progress on it. Alongside the fiscal framework that we talked about earlier, we have an accountability framework. That looks at how we are collectively accountable for delivery on homelessness or teachers and narrowing the poverty-related attainment gap, for example, without ring fencing.

The framework is at an advanced stage. We have removed £1 billion of ring fencing, mainly in early learning and childcare, as a goodwill gesture in advance of the accountability framework being signed off. We said that doing that was a risk, but we wanted to set a direction of travel, and £1 billion was baselined into the local government budget. Of the £14 billion local government settlement, about £250 million is ring fenced in year.

Local government spends £4 billion on education and £3.5 billion on social care. Those are big chunks of its budget. Those areas are a joint priority. I do not think that there would be many calls from any political party here or in local government to say that we should not be spending £4 billion on education or £3.5 billion on social care, because they are key priorities for local government and for us.

We end up getting quite focused on the small amount of the in-year ring fenced funding that is left—I think that it is £250 million—which covers things such as pupil equity funding, the attainment funding and the £145.5 million for teachers. To be honest, having money going directly to schools so that headteachers can decide what they do with it has been quite innovative. Headteachers will say that they have been able to support pupils and families in ways that they would not have been able to otherwise.

There is a balance to be struck: we have to ask what we are trying to achieve and, if we think that those are good things, I presume that, collectively, we would want them to continue. I am not pushing back on the principle, but if we can agree that we would want to continue to empower headteachers and enable some funding to go directly to them to provide support for families, I would not want to lose that. It would be a shame if we were to move away from that.

Those are the types of discussions that we will have about the budget. Normally, if there is a new burden, as local government would describe it, or a new funding stream to deliver A, B and C, there would be a negotiation as to what that would look like. Local government will provide a lot of information about what it would cost, as it will not cost the same in each area, and we see where that lands. The process can be quite backwards and forwards. A landing spot for delivery will then be reached, because the policy is seen as something new that the Scottish Government is asking local government to do. We do not just put a finger in the air and say, “Oh, we think that that’s enough”. There is quite a lot of negotiation. Ellen, do you want to come in?

I raised that at the finance interministerial standing committee—FISC. Whatever we thought about the levelling-up funding—we would all have our views on funding a roundabout, for example—there is now a collective view that that money needs to be spent more strategically and efficiently. However, I made it very clear that money that had been promised had to be delivered, because, as you have pointed out, projects have been scoped, plans had been made, and what communities, towns and cities expected to receive needs to be delivered. After that, there is a need for a more strategic and efficient use of our collective resources.

Again, all the devolved nations made it very clear that things such as shared prosperity funding need to be routed through the devolved Administrations, because that will make sure that the money is spent in the most efficient, effective and strategic way rather than in little bits here and there.

There was no real pushback on that. However, there is still a question about what happens to what has happened so far. It would not be fair to remove that funding. The sooner that there is clarity and certainty, the better. We can then move on to a better way of working together on those strategic issues.

Part of that is about building the right number of houses of the right size in the right places. There are lots of issues around the size of homes and making sure that they are correct for larger families, and around accessible housing. Having the right plan is absolutely critical. Part of it is about building but, as you know, some of it is about bringing homes back into use. We are having lots of detailed discussions with local government about what it will take to get voids turned around more quickly. I think that there are 1,800 voids in the city of Edinburgh alone, or maybe it is 2,000—

That is where we get into the territory of what is appropriate. The Verity house agreement is about both spheres of government recognising each other’s roles; it is also a move away from ring fencing, as we talked about earlier. That does not mean that the expectation of reform and transformation goes away. There is a question about how we collectively hold each other to account for progress. The best way to do so is probably to highlight and champion best practice, and perhaps also to ask other authorities when they will use it.

There are also the external stakeholders who will say, “This is good practice; why is it not in place?”, and they will bring their own influence to bear. It is not in the spirit of the Verity house agreement to say, “If you don’t do this, we’re not going to give you your social work money”—that is just not where we are. However, if you are asking me whether I would like the pace to be picked up a bit, the answer is yes.

There might be ways of incentivising. The work that is done around the—I am going to get the name wrong.