Chamber and committees

I might best address that question by looking at two different categories of people. The first is people who were economically active and, as a consequence of what happened during the past couple of years, have decided not to continue that economic activity. Covid has been very disruptive to lots of people in lots of ways. We have to find ways of motivating people to continue to make an economic contribution for perhaps longer than they want to. The key to that is entrepreneurship. A lot of those individuals probably have an economic contribution to make through entrepreneurship, and we have to make sure that our entrepreneurship activities reach them and provide them with a way of taking forward their ambitions. That is one grouping.

The other grouping is those who have been economically inactive for a lot longer. I see them as coming under part of the work that we are doing on the tackling child poverty delivery plan.

We have to erode the level of economic inactivity in Scottish society. As I think that I have said to the committee before, in a year, we have seen an improvement of about 1 percentage point in economic inactivity. The committee might say, “Well, that is only 1 per cent”, but it is pretty significant. Economic inactivity levels are about 21 per cent in Scotland, and they can probably only ever come down to about 15 or 16 per cent. Narrowing it by 1 per cent is therefore quite an achievement.

It is necessary to have a relentless focus, in a supportive and holistic way, on those individuals, because none of those cases will be simple. They will all be complex, and people will need complex interventions help them get into economic activity. However, we have to do that. As Liz Smith will know from all her dialogue across the economy, everyone is short of people.

I have made a solemn and absolute commitment to balance this year’s budget and we must accomplish that task.

It is probably best for me to say that the working group has started its activity. It is difficult for me to predict exactly when the group will report. We are anxious to ensure that early progress is made so that we can consider any implications and have wider discussions with stakeholders about those, given that they would be material for local authorities’ decision making on council tax. I would like that process to be concluded as quickly as possible, although it is difficult for me to give that a definitive timescale. However, I recognise the urgency of that work, which is under way.

All that I am trying to say is that I do not think that there is an awful lot of difference between the two numbers that we are talking about. That is the only point that I am making.

My point and my answer is that the overwhelming majority of the expenditure that is envisaged in relation to the national care service in the next financial year is in relation to the improvements to social care staff pay. The other governance costs—if I can call them that—and the costs of preparations for the service are very much the minority of the expenditure. As that position develops, the financial memorandum will redevelop. You are asking me to commit to detail in advance of its being finalised within Government. I am not in a position to do that today, but I hope that what I have said about the balance of expenditure between the larger amounts on social care remuneration and smaller amounts on governance helps the committee to find comfort on the issue.

The genesis of the idea of having a tax discussion paper was as a response to a very dramatic change to the comparative landscape on taxation, as a result of the mini budget in September. When I came to the committee, I indicated that I thought that some further dialogue would be required, given the nature and significance of the divergence that had been announced. As we all know, that did not last very long, so that particular imperative moved on and the immediate urgency and necessity of that discussion was no longer apparent.

What I have charted in my response to the committee is that, in order to support the decisions that we took in our own budget in December, we undertook extensive stakeholder discussion and dialogue. I chaired a number of panel discussions with a broad range of stakeholders to hear their views, the Minister for Public Finance, Planning and Community Wealth did likewise and a variety of other discussions took place. There was extensive consultation activity, but we did not have a consultation paper or a wide open consultation of the sort with which colleagues would be familiar.

There is a space and a place for us to embark on longer-term discussion of taxation and I am open to looking at those questions in the future, but the immediate urgency was driven by the quite dramatic changes to the tax landscape, which, as we all know, did not last long.

I have to say that I am pretty sceptical about that. That issue is directly related to the fact that we have 1,700 people on delayed discharge in our hospitals. If underspend somehow emerges out of more efficiency in health and social care partnerships, I would like to see it used to ensure that people are properly supported in a care environment that is appropriate for them. Therefore, it is unlikely that that resource should be taken out of health and social care partnerships and put into some other area of council activity.

We have a collective understanding that our hospitals are operating at far too intense a level—the last time that I looked at the data, percentage hospital occupancy was in the mid-90s, when it should be at a maximum of the mid-80s, and we have 1,700 people on delayed discharge. If resources have been freed up because of efficiencies in health and social care, we should use them to expand our health and social care footprint.

I am conscious of the committee’s interest in this topic, and I have a feeling that the Government and the committee might have been talking at cross-purposes about it. I certainly do not want the committee to have the view that we are waiting for some moment of public sector reform to come along. Public sector reform is under way and on-going, and there is a number of live examples that I can cite. There is the best start bright futures programme, which is in relation to our child poverty eradication work; that involves a significant amount of public sector reform. The work on keeping the Promise is about public sector reform, because it relates to how we support our children who face the greatest of challenges. There is work under way on education reform around the Scottish Qualifications Authority and Education Scotland. There is the wider reform work that is being undertaken through the introduction of early learning and childcare, which was completed last year.

I understand that the committee feels that there is a big report waiting to be published. The way that I would characterise it is that the Government is committed to the Christie commission principles; we have been taking those forward on an on-going basis since the commission reported.

The examples that I just gave are the most recent examples of what we have undertaken. The Covid recovery strategy, which involves a significant reshaping of the public sector into person-centred public services, is another of the most recent distillations of the work that the Government is undertaking.

I appreciate the question. We are working directly with public body leaders on estate rationalisation and on having bodies working together and we frequently encourage steps towards reducing estate utilisation by co-location. We are now in a context in which the world is quite different because people are not all working in offices as they used to, so there are opportunities to reshape estate provision. Those should be taken—make no mistake—because of the necessity to make an impact by reducing overall costs.

A range of activity and dialogue is being taken forward with public body chief executives. Groups of public body leaders are working together on some of those projects and we have encouraged and motivated them to take as much significant action as they can.

It would probably be best to say that I will write to the committee with some detail on that, because I do not have a specific comprehensive cost of that to the front of my mind. I would counsel that this is not just about gas prices—the gas price is a driver of the electricity price, which is of great concern.

The reason that I had better get precise information is that there will be extensive collective public procurement of electricity and gas supplies, which might have been bought at a time when that has provided us with more or less protection. I think that I had better write to the committee about that detail.