Chamber and committees

Minister, under section C, “Scotland Reserve and Funding Position Details”, you say:

“Despite this continually evolving, volatile position, reserve limits remain fixed. Those limits being a cap of £700 million with annual drawdowns normally restricted to £250 million for Resource and £100 million for Capital and Financial Transactions combined. As we are currently within a defined period of “Scotland Specific Economic Shock” (as set out in the Fiscal Framework) the annual drawdown limits are waived but the cap of £700 million remains.”

As I mentioned in the previous session, John Mason said only last week that the University of Glasgow has greater reserves than the Scottish Government is allowed to have. That gives some perspective. Can you tell us, because the previous witnesses were unsure when asked directly, when that three-year period of Scotland-specific economic shock will end?

What difficulties are the reserve limits creating for the Scottish Government in delivering on its budget?

Yes, I would certainly be happy with that, but I am not the one who is asking questions on this area—if Douglas Lumsden, Michelle Thomson and Liz Smith are happy, we can take that approach.

Thanks for that, Daniel.

I welcome to the meeting our second panel of witnesses: Paul Bradley, policy and public affairs manager at the Scottish Council for Voluntary Organisations; David Melhuish, director, Scottish Property Federation; and Alastair Sim, director at Universities Scotland.

Thank you all for your written submissions to the inquiry. There are no opening statements so we will move straight to questions.

I will begin with Universities Scotland. I found all the submissions to be really interesting and there is a great contrast between them, so the committee will probably ask you all a similar number of questions.

Mr Sim, your opener is quite direct. The last paragraph on the first page says:

“Put bluntly, other areas of Scottish public life that should be prioritised for investment, including higher education, look as if they will have to fight for the leftovers from the highest priority commitments.”

That is on the back of your saying that the Scottish Government’s priorities should include universities and higher education. The issue with that is that every single organisation—and I mean every single organisation—that comes to the committee says the same thing: we need more resources for our sector. You just have to fill in the name of the sector.

You have made arguments for why you think it should be the universities sector, but where should the resources come from, and how much additional resource should the Scottish Government be putting into the sector?

I appreciate that, and you have made a strong argument, but the two questions that I asked initially have still not been answered. How much additional resources are needed and from where should they come? In the earlier part of the meeting, we discussed preventative spend. A lot of the growth that you are talking about will not come this year or next, but the money will have to come out of the budget this year and next. Where should the resources come from? Local government has made a passionate plea and the SCVO is also keen to have additional resources.

Should the Scottish Government be planning in the resource spending review for additional student numbers, both domestically and from overseas? Would you like a growth programme to be built in? If that is the case, how would you envisage that? Would it be 1 or 2 per cent a year higher? What would the balance be? How do you think the Scottish Government should balance the number of Scotland-domiciled students with those from elsewhere?

You go on to refer to

“the well documented change in consumer behaviour”

and you talk about

“The loss of economic productivity and tax revenue associated with these falls in activity”.

Thank you very much for that.

Mr Bradley, in response to the question

“Does the framework properly reflect the current economic and political context?”

the SCVO stated that

“there is little recognition of the integral role played by the voluntary sector in social and economic life”.

From whom is there little recognition? My understanding is that there is a lot of recognition of that role at all levels of Scottish society, so can you expand your thoughts on that a wee bit?

You are probably aware that last Thursday we took evidence from the Secretary of State for Levelling Up, Housing and Communities, Michael Gove. I put directly to him some of the concerns that SCVO raised in its submission. SCVO and the voluntary and third sector that it represents makes a multibillion-pound contribution to Scotland in cash terms—not to mention the phenomenally important social aspects.

Were you reassured by Mr Gove’s responses? When I put the issues to him, he indicated that the UK Government wants to do a lot more to support the sector.