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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 14 July 2025
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Displaying 3539 contributions

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Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Thank you for that. I think that we all realise how incredibly complex that is. It is a tribute to you that you are able to produce forecasts as accurately as you do, given those issues.

As inflation goes up, even with increased pay rises, we could end up with significant fiscal drag, which is concerning many people. In figure 4 of your report, you talk about the implied income tax net position. What do you believe the impact of fiscal drag will be on disposable income?

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Thanks—I appreciate that. We have many more questions that we could ask, but time is against us and, as Ross Greer has pointed out, the cabinet secretary is waiting to come in. We have another evidence session to begin.

I will wind up the session by formally thanking Dame Susan Rice for all her phenomenal work over the years and her leadership, wisdom and insight, which have proved invaluable to the committee. Like John Mason, I was here at the very birth of the SFC, and it is great to see how it has developed and flourished over the years. I am sure that it will continue to do so.

I will see you tomorrow, Dame Susan, at the Scottish Parliament information centre briefing, which starts at 8 am—with bacon rolls, just for those who are not already sold on the idea of attending. The committee will take a break until 11.25.

11:19 Meeting suspended.  

11:25 On resuming—  

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Thank you very much for that opening statement.

It is significant that you have very little room to manoeuvre. I think that the committee appreciates that fact, but we will ask questions about the Scottish Government’s choices and the reasons for making them.

First, some outside organisations have expressed an element of frustration about the detail that has been provided. I know that you will want to make it clear up front that this is not a budget but a resource spending review. However, the concern is that we have received only level 1 and level 2 funding figures, and organisations are obviously wondering where they fit into some of the decision making that is taking place.

11:30  

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Thank you.

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

I asked that very question of the Scottish Fiscal Commission representatives—not today but the last time they were here. Their view was that that would have no impact on spending in fact. However, I would say that the child poverty budget line, as distinct from social security assistance, is projected to increase from £34 million to £97 million, so that is a significant increase, but it is only a fraction of the £2.4 billion increase in social security spend.

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

From my reading of the situation, it appears that you have been very cautious in your spending proposals. I imagine that you hope to be able to add some resources to the figures that are outlined.

To start with the level 1 figures, in your statement to Parliament last week, you said:

“We have prioritised spending on health, social security, education and tackling climate change”.—[Official Report, 31 May 2022; c 11.]

However, if we look at the education and skills resource, we see that, during the first four years of the spending envelope, from this year onwards, there appears to be virtually no increase—there is just a 1 per cent increase in cash terms over the next three years. It is interesting that there is then—in 2026-27—a huge jump of about 17 per cent. There are a number of other areas in which we see significant changes in that last year. Why is that the case? If the decision is that education is to be prioritised, why has the funding for it been kept very tight over the next few years before there is suddenly a significant jump in 2026-27?

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Good morning and welcome to the 18th meeting in 2022 of the Finance and Public Administration Committee.

Agenda item 1 is evidence taking from the Scottish Fiscal Commission and then the Cabinet Secretary for Finance and the Economy on “Scotland’s Economic and Fiscal Forecasts—May 2022” and the Government’s resource spending review and medium-term financial strategy. For our first evidence-taking session, I welcome to the meeting Dame Susan Rice DBE, chair, Professor Francis Breedon, commissioner, Professor David Ulph, commissioner, and John Ireland, chief executive, Scottish Fiscal Commission.

Before we move to questions, I ask Dame Susan Rice to make some opening remarks. Good morning, Susan—over to you.

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

I am comparing the MTFS with your forecasting document. The £250 million is exactly the same as the figure that the Scottish Government gave, but you have put in £591 million for 2026-27, whereas the Scottish Government has just £400 million in 2024-25.

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Yes. I am just wondering why the Scottish Government has not included those figures but you have done so. That was all. There is a difference of £191 million.

Finance and Public Administration Committee

Economic and Fiscal Forecasts, Resource Spending Review and Medium-term Financial Strategy

Meeting date: 7 June 2022

Kenneth Gibson

Thank you very much.