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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 4 May 2021
  6. Current session: 13 May 2021 to 15 January 2026
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Displaying 4111 contributions

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Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

Following on from that, I note that in your statement on 9 December you said:

“Although the budget lays the groundwork for a green economic recovery from Covid-19, we must be clear that the UK Government’s spending review has hindered rather than helped us on that mission.”—[Official Report, 9 December 2021; c 70.]

Can you expand on that a little bit?

Moreover, on page 11 of its briefing to the committee, SPICE says that

“Four of the eleven portfolios fall in both cash”

and

“real terms”.

One of the portfolios is net zero, energy and transport. If the priorities are to try to boost the economy and to take on the challenge of the climate emergency, why are net zero, energy and transport and finance and the economy two of the four portfolios whose funding, according to SPICe, is falling?

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

Thank you—it is just for the record.

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

At the meeting on 18 January, is there an opportunity to allocate some of the £319.4 million of unallocated resources to some of the poorer local authorities?

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

No, I was not expecting you to do that, to be honest. However, if you would like to make one, I would be more than happy for you to do that. I was quite surprised that there was not one.

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

Sure—fire away.

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

We have been joined by Kate Forbes MSP, Cabinet Secretary for Finance and the Economy, for our second evidence-taking session on the Scottish budget 2022-23. Ms Forbes is joined by Scottish Government officials Lucy O’Carroll, who is the director of tax and fiscal sustainability; Douglas McLaren, who is the deputy director of budget, pay and pensions; and Ian Storrie, who is the head of local government finance. I welcome the cabinet secretary to the meeting.

I remind members and witnesses that our broadcasting team will operate the microphones and that they should pause for a few seconds before speaking to ensure that they will be heard. I intend to bring members in to speak in the order that we discussed earlier. If anyone would like to come in at another point, they should type R in the chat function.

All questions should be directed to the cabinet secretary, in the first instance. If Ms Forbes wants an official to respond, she should make that clear so that the broadcasting team can bring them in.

We have up to two hours for the discussion. Before we open up the meeting to questions, I invite Ms Forbes to make a short opening statement.

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

Of course.

That concludes the committee’s questions absolutely on time. I thank Jackson Carlaw and the supporting officials for their evidence.

I suspend the meeting for five minutes to allow final checks to take place before the cabinet secretary takes questions.

10:45 Meeting suspended.  

10:59 On resuming—  

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

In your statement on 9 December, you said:

“On income tax, the Government’s priority has been to make the tax system fairer and more progressive, and to protect low and middle-income taxpayers.”—[Official Report, 9 December 2021; c 72.]

However, on page 18 of its briefing, SPICe says:

“Scottish taxpayers who earn between the proposed Scottish higher rate threshold (£43,662)”—

that threshold has not increased by inflation, and neither has the UK one—

“and the rUK higher rate threshold (£50,270) will pay 41% income tax and 12% NICs on their earnings between these two amounts – a combined tax rate of 53%.”

That means that people in Scotland who earn between £43,662 and £50,270 will actually be paying more in tax than people who earn more than that. Someone earning £51,000 will have a marginal rate of taxation of 43 per cent, because of the 10 percentage point reduction in national insurance. How can that be deemed to be progressive, given that that includes many people who have families and large mortgages?

11:15  

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

I can understand your argument about the UK, and, obviously, that is something that I subscribe to. However, if people earning over £43,662 are going to be confronted by a 54.25 per cent marginal rate of tax, perhaps the threshold should have been increased, rather than allowing the fiscal drag to ensnare more people in that tax net.

Finance and Public Administration Committee

Budget Scrutiny 2022-23

Meeting date: 21 December 2021

Kenneth Gibson

There has been a lot of debate and discussion on the resources that are available to the Scottish Government, but there has not been much debate on capital and infrastructure. Everyone accepts the figure on page 2 of the budget: there is a 9.7 per cent reduction in real terms of the draft capital. That is backed up by the SPICe report, on page 34. That has significant implications for Scotland’s capital programme, particularly as the cost of materials is still much higher than the general rate of inflation. What projects in Scotland are likely to be put on hold, from repairing fewer potholes to building more schools? What are the implications of that severe cut in capital resources?