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Chamber and committees

Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 22 July 2025
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Displaying 3539 contributions

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Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

Okay. In evidence to the committee, Dr Brewer of the Resolution Foundation said that UK Government cuts of £185 million to Scotland’s capital allocation were not “a sensible action”. He added:

“We are pointing the finger of blame principally at the UK Government”.—[Official Report, Finance and Public Administration Committee, 20 December 2022; c 6.]

He had said previously that the decision not to enhance capital funding, given the high levels of inflation,

“will lead to a steep decline in the purchasing power of Scottish Government investments ... this may hamper the Scottish Government’s ability to meet its net zero targets and damage the economic recovery”.

To what extent is that the case? How is the Scottish Government trying to mitigate the damage?

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

Obviously, if there are significant increases, the money would, understandably, have to be found from elsewhere.

Colleagues will be glad to know that I have only a couple of questions more, and then I will open out the session. I am not going to ask all the juicy questions, but I want to ask about one important issue that has gone back and forth.

In evidence to the committee, Professor Roy of the Scottish Fiscal Commission said, in talking about higher rate and additional taxes:

“the Government has to be careful when it thinks about how much additional revenue might come in, just because of people’s potential behavioural responses.”

He added that, although on paper the extra penny on the additional rate would bring in a further £30 million of taxation,

“that is without behavioural change”,

and he went on to say:

“When you add in the behavioural change, we think that the totality of that is only £3 million.”—[Official Report, Finance and Public Administration Committee, 20 December 2022; c 30, 38.]

Other organisations and groups might have different views on that, but that is what the Scottish Fiscal Commission is basically saying.

Is it worth the bother of adding an extra penny on tax if 90 per cent will be lost to behavioural change? How concerned are you that the level of behavioural change restricts your room to manoeuvre and that, if tax went up further, you might end up with a negative tax-raising situation?

While I am on taxation, I will ask more about that. Is the Scottish Government worried about an increase in people incorporating to avoid paying taxes? Is it worried about the image that is presented to other parts of the UK—wrongly, in my view—that Scotland is a high-tax country?

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

There is, of course, an argument for additional taxation that is being made by some people. The difficulty is that that does not seem to take behavioural change into account at all. People seem to think that, if tax is increased by X amount, the revenue to the Scottish Government will indeed be X although , in fact, that is not the case.

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

Point taken.

Finally from me, when we debate the budget in the chamber, we will no doubt have the usual demands for vast increases in expenditure across every portfolio accompanied either by tax cuts or—who knows?—possibly tax rises. In the 26 days since your budget statement, which political parties have approached you asking to meet to discuss alternative proposals? Of those that do, will you insist that demands for increased spending in one area of the budget are met by identified reductions elsewhere or by specific tax rises in order to meet them, to ensure a balanced budget?

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

I just wanted to know if you had been approached by them. I would not expect them to turn up at your house on new year’s day to first foot you.

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

I am just trying to put it into context with where the rest of the Scottish consolidated fund is going to be spent. Not many areas are going to get the level of increase that each one of the office-holders has done.

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

I do not want to spend a lot of time on this, but £242,000 is the increase for the SCHR. You mentioned two additional members of staff, but surely there must be more to it than that.

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

What developments do you envisage from that in terms of enhanced public engagement?

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

And the good news is: no new website on the way.

Finance and Public Administration Committee

Budget Scrutiny 2023-24

Meeting date: 10 January 2023

Kenneth Gibson

If you had not done that, there would have been very severe impacts on the budget.