Chamber and committees

Longer than I anticipated being here, Presiding Officer.

The key point that I make to Jackie Baillie is that the funding for the NHS has been increased, and that can be deployed to meet the needs of individuals in our society, which is what it is intended to do.

We are spending £19 billion on the national health service, with a £1 billion increase in one year, because we have taken tough decisions on tax.

Part of the difficulty and challenge that lies before me—not least in balancing the budget this year—is in the competing propositions that we hear from different sides of the chamber. For example, Liz Smith demanded that I spend much more of the budget on supporting the productive end of the economy, which she defined as high and middle-income earners. She ignored the fact that those individuals benefit from the social contract of early learning and childcare, free personal care, free prescriptions, free eye tests, and no tuition fees for their children should they go to a Scottish university.

However, Pam Duncan-Glancy said that there is nothing in this budget whatsoever to tackle inequality, managing to skate past the £450 million that the Government is spending on the Scottish child payment. That illustrates that the Conservatives want to undermine the budget by not supporting the progressive tax agenda that we are taking forward, while the Labour Party does not want to support us in our journey to try to tackle inequality through measures such as the Scottish child payment. That illustrates the scale of the absurdity of the propositions that I am facing.

I would welcome that. I know that the culture minister will be happy to engage with Sarah Boyack on that point.

The legislative provisions are being prepared for the tourist visitor levy, to be introduced to Parliament. Parliament will therefore have the opportunity to scrutinise legislation on that relatively shortly. I am sure that such a measure, which will empower local authorities, will be warmly welcomed on all sides of the parliamentary chamber—just like the workplace parking levy legislation, which was so warmly welcomed by the Conservatives.

Emma Roddick made a significant point. She highlighted the amount of money that the Government is spending in Scotland to mitigate the United Kingdom Government’s welfare policies. She put things into common parlance by illustrating that the total amount of money that the Scottish Government spends on mitigating UK Government welfare policies amounts to 38 times the cost of a referendum—the thing that the Conservatives banged on about. We could have 38 referendums in exchange for the welfare cuts that are being inflicted on the people of Scotland as a consequence of the UK Government’s policies.

I have tried to explain to Parliament on countless occasions—I have explained this face to face to local government as well—that the financial comparison that is made is from budget bill to budget bill. From the previous budget bill to this budget bill, as a consequence of decisions that I have made today £793 million more will be available to local government to spend next year than was available this year. I think that, in anybody’s book, that must be something to welcome; I hope that it will be welcomed.

I know that Mr Rennie and I are on a bit of a roll when it comes to good will right now, so I hope that he will speak to endorse what I am saying. However, I see that Mr Cole-Hamilton’s lectern is up, so that makes me worried that Mr Rennie’s calm voice will not be heard in the debate. If he wants to intervene on me during my closing speech to welcome my announcements, he will be very welcome to do so.

I recognise the difficulties that our islands authorities are facing in managing the cost increases that their interisland ferry networks are experiencing due to the effects of inflation and rising fuel prices. That applies especially in Orkney and Shetland, and to a lesser extent in Argyll and Bute and the Highlands.

The Government gave a commitment some years ago to fully fund those services. The second commitment that I make today is that we will honour that commitment. We recognise that costs have increased, so my officials are engaging with the local authorities concerned on the level of funding that is required. Parliament will be informed once those discussions have concluded.

The third and final announcement that I want to make today is that, in the earlier Finance and Public Administration Committee debate on the budget, I acknowledged the call from Clare Adamson, the convener of Parliament’s Constitution, Europe, External Affairs and Culture Committee, to continue to sustain our investment in culture and the arts. The importance of that funding to the wellbeing of our society has always been passionately championed in the Parliament by Fiona Hyslop, who was a long-serving cabinet secretary for culture in the Scottish Government.

We had asked Creative Scotland to sustain investment next year by utilising £6.6 million from its accumulated national lottery funding reserves, in place of another year of additional grant funding, to compensate for generally lower lottery income. I am now in a position not to require that. I will provide Creative Scotland with an uplift of £6.6 million for 2023-24 to ensure that its reserve funding can supplement, rather than replace, grant funding. That means that there will be a substantial increase in the Scottish Government’s funding for culture and major events in the next financial year at a time when our country requires the inspiration that the culture and arts sector can provide for us all.

I have judged, based on the current financial position, that that is the absolute limit of the additional funding that I can provide. The detail of the budget revisions will be reported to Parliament as part of the autumn budget revision.

Together with our partners in the Scottish Green Party, we offer today a substantial budget package that will help those who need help most. The budget measures that we have brought forward are anchored in three major themes: first, our determination to end child poverty; secondly, the need to support the transition of our economy to net zero; and, thirdly, the requirement for sustainability in our public services.

The budget strengthens our social contract with every citizen of Scotland; they will continue to enjoy many benefits that are not available throughout the United Kingdom. The Parliament has already passed the motion on the Scottish rate resolution, which sets the tax rates for next year. The Scottish Government has taken the steps that we believe are appropriate to deliver fair and progressive taxation. We ask those who can afford to contribute more to support investment in our public services to do so. Those principles are reflected in our decisions to increase the top and higher rates of taxation by 1p each and to levy a higher rate of tax through the additional dwelling supplement. Those decisions mean that the majority of people in Scotland will still pay less tax than they would if they lived elsewhere in the United Kingdom.

Our progressive choices on Scottish income tax mean that, this year, the Government will deliver record funding of more than £19 billion for the health and social care portfolio, with more than £2 billion of funding being provided to deliver and improve primary healthcare services in the community.

The budget also delivers for businesses. The Government has responded to the biggest ask from business organisations, which was to freeze the non-domestic rates poundage. That will save ratepayers about £300 million next year. The package secures the lowest poundage in the United Kingdom, and it supports businesses with a package of reliefs that is worth about £744 million.

Delivery of support for people who are most in need in these difficult times is the foundation of the budget; the Government is doing all that we can to support individuals and families. That, in turn, supports a stronger, more resilient and more sustainable economy. The budget commits more than £5.2 billion for social security payments, which will provide support to more than a million people in Scotland. That represents an increase of more than £1 billion on last year’s budget.

The funding includes £442 million of investment in the Scottish child payment, which is a key support for eligible families. We provide £25 per week per child, and the payment is available only in Scotland because of the choices that the Government here has made to give a lifeline to families who face difficulties in our country.

I do not have that number to hand, but I will endeavour to send it to Pam Duncan-Glancy. What I can say is that there are families in this country who are surviving because of the child payment that the Government has provided. [Applause.]

We have gone round the house several times on that this afternoon. First, has Mr Johnson obliterated from his recollection the decade of austerity that we have suffered at the hands of the Conservative Government? We have been wrestling with that all the way through. Secondly, I know that there is a great debate about ring fencing, but I have just announced a budget settlement that increases local authority funding by £790 million for the coming year. Why could not the Labour Party welcome that during the debate?

The £100 million is additional to what was announced last week. I will come on to explain issues about the announcements that were made last week.

Last week, we confirmed that we would provide an additional £156 million from Scottish Government funds—£33 million in this financial year, plus a further £123 million next year—to support a new pay offer for teachers. That would see salaries rise by 11.5 per cent from April. I encouraged that proposition being put to teaching staff for their consideration. That additional funding for 2023-24 is on top of the £570 million increase in funding that has already been included in the local government settlement, and it takes the total additional funding for local government for next year to £793 million.

As a result of the decisions in this budget, the total funding that is available to councils to support local services will be nearly £13.5 billion, plus the revenues from any local decisions on council tax. That is equivalent to a 3 per cent real-terms increase from what was in the 2022-23 budget bill.

We are providing full discretion over £105 million of funding to allow councils to replace national empty property relief with, for example, more localised schemes. We will also increase the maximum fee levels that a local authority can charge for a penalty charge notice for parking infringements. That represents a comprehensive support package for local government within this challenging financial settlement.

It is welcome that progress has also been made in recent days on the agenda for change pay discussions. The Government is undertaking further work to put in place a public sector pay policy prior to the start of the new financial year.

As we conclude the 2023-24 Budget (Scotland) (No 2) Bill process, I have reflected carefully on points that have been raised in Parliament and by a range of organisations, and have recognised the financial challenges that are faced at this time by individuals, households, businesses, the third sector and the public sector. I am also aware of the challenges that are faced as we manage our way through the cost crisis. The budget is designed to do as much as possible to assist, at this most difficult moment.

None of this is easy. This is by far the hardest budget process that I have led, with the effects of raging inflation being felt against the impact of more than a decade of austerity and Barnett funding having come down by 5 per cent in real terms since 2021-22.

I have been open and transparent with Parliament on the budget challenges that we are managing for the current financial year and the forthcoming financial year. On 7 February, I indicated to the Finance and Public Administration Committee that the 2022-23 budgetary position continues to improve; I am now confident of the path to balance for this financial year. That is the result of careful budget management and of taking hard decisions in order to live within our means, despite the ferocious pressures that are being created by high inflation.

I can report to Parliament two changes to our funding position that have enabled me to take further steps to increase commitments that were made in the draft budget. The first of those changes is that it has been confirmed by His Majesty’s Treasury that we will receive £125 million of additional funding as a result of Barnett consequentials arising from the United Kingdom supplementary estimates. Secondly, I expect to receive an additional £21 million for 2023-24 due to the correction of an error in our UK spending review allocation.

Christine Grahame is a wise and thoughtful member of Parliament, so I would not have thought that she would be so surprised by the Conservatives’ lack of reaction to the news of the Scottish child payment.

The decisions in the budget are designed to support people who are facing difficulty; to support businesses to make their way through the challenging transition to net zero that is required; and to ensure that our public services can meet the needs of the public. These are difficult decisions in difficult economic times. The budget that has been set out to Parliament enables us to invest in our public services to ensure a strong boost to local authority funding and to ensure that we help those who need it the most.

I move,

That the Parliament agrees that the Budget (Scotland) (No. 2) Bill be passed.

I ask Liz Smith to clarify the point that she has just made about the Scottish Conservatives’ support for the Scottish child payment. Does that mean that the Scottish Conservatives are going to vote for the budget? Unless they vote for the budget, the Scottish child payment will not happen. [Interruption.]