Chamber and committees

It is partly mitigation but, of course, our investment in social security has for a number of years gone beyond the block grant adjustment. That additional investment is beyond the consequentials that flow to social security, and I would argue that it is an additional investment in reducing poverty. You can see from the additional investment, whether it is in the Scottish child payment or the adult disability payment, the importance that we place on trying to support the most vulnerable people in our society.

So, it is a bit of both. It is partly mitigation. Some of the wider spend, whether it is on discretionary housing payments or the Scottish welfare fund, is clearly mitigation of UK Government welfare policies. Without that spend, people would not be able to sustain their tenancies or manage in the cost of living crisis. We have also decided to re-establish the independent living fund, which will support people to live independently in their homes. We hope that that will prevent people from losing their independence and support people who are in work and who have disabilities. It is a balance.

I know that COSLA is looking at work around the distribution of resources, and I will bring Ellen Leaver in on that in a second. However, as has been the case for decades, it is very difficult for COSLA members to agree distributional changes among themselves; it is incredibly difficult to get 32 leaders with particular interests from their councils’ positions to agree to a position that might not benefit them. Of course, COSLA’s distribution of resources is done by agreement, so it makes change very difficult.

We can look at examples such as the funding for woodland creation, which has been prioritised and which will facilitate around 9,000 hectares of new planting and contribute to meeting climate change targets and net zero delivery. Scottish Forestry has a good track record of approving new woodland applications; in fact, it has approved a record number. The work that Scottish Forestry is able to do will be focused on some of the key delivery areas. It will not be able to do everything, and we expect it, like any public organisation, to prioritise the investments that it must make.

I come back to the point that I have made throughout the meeting, which is that given that we have less money to go around, we have had to be clear with organisations about the priorities. We cannot expect them to deliver everything if they do not have the resources to do that, so such prioritisation is critical. That is what we would expect of Scottish Forestry, along with all the other organisations that are helping to deliver in rural Scotland.

I will maybe get Alison Cumming to check that.

When we ask businesses what makes a difference and how our enterprise agencies or Business Gateway can best assist them, we find that they are not always aligned to the same priorities. Therefore, there is a discussion to be had about what the evidence tells us about what has the biggest impact. In times of constrained resource, it is important that we prioritise.

We will have to come back to the committee in relation to Business Gateway, if that is okay. We will write to the committee about that specifically.

It would not have been viable to base a funding arrangement for the council tax freeze on the amount by which each local authority said that it was going to put up its council tax. I do not think that COSLA—or the 32 local authority leaders—would have agreed with one authority getting 10 per cent and another authority getting 3 per cent, depending on the projection. I think that there would have been an outcry if that had been the proposition. There would always have to have been an averaging of those projections to see where the quantum lands. As I said earlier, the quantum is not out of line with Fraser of Allander analysis.

However, I recognise that there are particular issues. For example, from my discussions with the leader of Orkney Islands Council, I am well aware that there are structural issues around its funding through the special islands needs allowance. There are some distributional issues for rural authorities more generally, but Orkney Islands Council has particular issues, and we will need to look at how we can support the council to address those.

I will be happy to furnish the committee with that longer-term plan after the spring budget. MTFS in May will be a key point at which I can set out what the medium term looks like, in the light of what we know at that point.

The point that you are looking at goes a bit beyond that, into the longer term, and I know that the committee is taking an interest in that. I will try to furnish the committee with as much information as possible on that at the earliest opportunity.

That information and evidence will be important for the interventions that we are making. Reliefs change over time; some cease and then new ones are introduced. Gathering an evidence base on the impact of each relief is important, and that work is on-going. I am happy to keep the committee apprised of the information that we get back on the analysis of that.

The Minister for Housing is looking at what the business model might be for levering in additional investment. The situation might look a bit different from the traditional delivery that housing associations, which raise private investment to deliver on their targets, will continue to provide.

We are looking at whether there is scope to lever in additional investment, underpinned by Scottish Government investment, for particular delivery models, such as those for mid-market rents. The Minister for Housing has been working on that for some time. Once that work has come to a conclusion, he will set out in more detail what that might look like.

That is not an unreasonable suggestion. It might not be a bad idea to have some kind of note to explain why that amount is not part of the purchasing power of the budget that is being given to higher education student support but is really an accounting issue.

That is a good point. When we are looking at the financial position of an organisation, we cannot ignore it reserves. For example, Strathclyde Passenger Transport’s very significant reserves were a point that was taken into account when it came to looking at its budget settlement. Money is money. If organisations are sitting on large reserves, that should be seen as part of the public purse.

We would be sympathetic to an organisation that has built up reserves for a purpose. An organisation might be taking forward a considerable piece of work or undergoing reform and is going to use reserves for that purpose, or it might have an investment plan that is going to spike and it has reserves that will be part of its investment plan for that particular period. All those things will be taken into consideration when it comes to a decision on whether the organisation should be required to use reserves.

If the point of reserves is that they are there to be deployed in times of budgetary constraint, this is such a time when they need to be brought into the picture. The short answer to your question is that, yes, reserves are being considered. The individual discussions with public bodies around their size and shape, their function and their investment plans will include the level of their reserve.