Chamber and committees

Australia has had road pricing for 20 years. You have an electric chip in your car, you drive along a motorway and you do not have to stop at any tollbooths or anything. You drive along, and you pass these things every 5km or whatever it happens to be. It is almost like being in a taxi—the meter keeps ticking over. If Australia has been doing that for 20 years, there is no reason why it cannot be done here, although, as you said, it will not be very popular. It would probably have to be met with reductions in other motor-related tax. One of the things about road tax is that it is not all spent on the roads—it just goes into general taxation.

Well, they will not happen without significant fiscal measures, so I think that it is an important fiscal issue for us. If farmers are not incentivised, they will just not do it; it is as simple as that.

Thank you for your evidence. We appreciate your giving us your time this morning, and thank you for your excellent report and for answering our questions. Your report will inform the committee’s approach to examining the finances of our net zero ambitions and areas beyond that, and we will consider the issues again at a future meeting.

We will now move into private session.

That was excellent—it was fascinating stuff, so thank you very much. It has stimulated our thinking on the subject and has probably generated quite a lot of questions from committee members.

I will open with some questions and then we will go around the table. In your last slide, under the “Fiscal Measures” heading, you talk about carbon pricing mechanisms matching a UK solution. You also mention devolved taxes and subsidies under that heading. It is really important that we take people with us on this journey, and I think that one of the most difficult things, as you list under your second heading, “Principles”, will be ensuring that what is done is proportionate.

You spoke about behaviour change and about good will from the public, which is what we need to be able to change behaviour. It is about how we marry those together. You said that, for landfill taxes, everything was set out over a number of years so that people could see the road to be travelled. Should the Scottish Government try to do that, so that we have a 10-year programme involving all the issues that you have mentioned, including how we reach various milestones along the way, where we think changes should be made, at what time they should be made, and by whom?

That concludes questions from other members of the committee, but I have one or two wee issues to raise.

Biodiversity is one of my great concerns. In the past couple of weeks, I have read in The Economist that, excluding our seas, 96 per cent of the biomass of all vertebrate creatures on earth is either human or the livestock that we raise to feed us. For example, 70 per cent of all bird life on the planet is poultry.

Some of the measures in Sweden with regard to lynx have been touched on. I know that a lot of work is being done to try to restore the Iberian lynx, which was on the verge of extinction.

What more can we do on biodiversity? For example, you have spoken about perhaps up to half of tree plantations being native woodland. We have done a lot in Scotland since the first world war, when our tree cover was down to 2 per cent. That is now up to around 17 or 18 per cent. It is not quite like that of Japan, which is 73 per cent. It has been like that in Japan for centuries because Japan has never denuded its forests. What more can we do to try to restore biodiversity, which has halved worldwide since the 1970s?

Good morning and welcome to the 10th meeting of the Finance and Public Administration Committee in 2022.

Agenda item 1 is an evidence session on environmental fiscal measures for Scotland. The committee will hear from Callum Blackburn, an independent consultant, on the findings of research that was commissioned during session 5 of the Parliament by the Environment, Climate Change and Land Reform Committee and which has recently been completed.

I welcome Mr Blackburn. He will present his findings for approximately 20 minutes and then we will open up the meeting to questions from members.

No, you are fine.

You have talked about overarching issues and the complexity of current fiscal measures. It is important that we ensure that the winners do not win by too much and that the losers do not lose by too much if we are to take people with us, but that can sometimes slow down the pace of change.

I know that John Mason is keen to talk about carbon tax, so I will not ask about that. Do you think that, while resources are being shifted towards net zero solutions, increasing the percentage of the overall tax take can happen only by increasing the amount of tax revenue that is available, or can that be done within the current envelope, broadly speaking?

If we look at the largest area of expenditure, which is on the national health service, we might ask how we can move the service towards net zero without shifting money from patient care to insulating buildings, or whatever. There could be long-term savings, but we would still have to invest in the short term. How can that be done in a practical, pragmatic way, or is it inevitable that the Government will have to increase its overall spend?

You have mentioned in your presentation some of the excellent work that countries such as Belgium, Sweden, Germany and Costa Rica have done. Should the Scottish Government and the UK Government look in detail at what is happening in those countries and try to implement some of those measures here, rather than reinvent the wheel and come up with something new that might or might not work? Adapting successful measures from elsewhere could save a lot of time and effort, if that can be done.

Human scientific ingenuity should not be ruled out. In my constituency, DSM, which employs around 350 people, has developed a feed additive called Bovaer, which will reduce the amount of methane emissions from cattle by between 30 and 90 per cent, depending on what type of cattle they are—dairy or beef—and on what their feed is. That would cost much less than retrofitting huge numbers of houses, for example, and it could have a significant impact on the environment. That example shows that there are a number of other areas that we could consider.

An investment of £100 million-plus will be made in that factory. The food additive will be marketed worldwide, and it has already had regulatory approval in the European Union. You spoke about changing some of the subsidies for agriculture. We could perhaps incentivise farmers to use that safe food additive to reduce methane, rather than progress some of the more complex methods that are currently being considered.

That advert for DSM is now over. I will open up to questions from around the table.

Douglas Lumsden touched on the issue of ferries. Ferries are now being designed to be hybrid but, given that they can last upwards of 25 years, smaller ones are now being designed so that they can be retrofitted. They might be fitted with hybrid power systems now, but in five years’ time they might have to switch to electric, and in 10 years’ time they might change to hydrogen or whatever. That is now being built into the design of ferries. After all, it is not just buses, cars and trains that we have to make more environmentally friendly.

John Mason is next.