Chamber and committees

Good morning, Deputy First Minister and colleagues. I will ask a couple of budget-related questions. I enjoyed your exchange with Lorna Slater on economic growth. It is fair to say that, since you came back into Government, there has been something of a shift in the language in Government, and more of a focus on growth than was previously the case.

However, in recent years, we have seen negative impacts on the Scottish Government’s enterprise budgets—I remember asking your predecessor Neil Gray about that issue last year. The budgets of the enterprise agencies, of VisitScotland and of employability programmes suffered quite severe cuts in this year’s budget but also in those of previous years. I do not expect you to tell us what will be in the budget, but would you accept that, if there is a new focus on economic growth, further cuts in the very areas of the budget that would help to drive that growth will not be helpful?

Thank you. I dare say that we will see what is in the budget in due course.

Again, on budget-related issues—the convener touched on this in her questioning—the committee has received a lot of evidence on the tax differential. We heard about that when we went to Prestwick airport in the spring, and witnesses have talked to the committee about a Scottish premium that they must pay to workers to offset the higher taxes that are paid here. If what is in the newspapers is to be believed, the policy chairman of the City of London Corporation will speak to the First Minister today and will raise some of those issues. Would you accept that a further widening of the income tax differential would be counterproductive when it comes to the pursuit of economic growth?

I am glad that you mentioned the migration figures, because I had a detailed look at them this morning. You are absolutely right: in the year to the middle of 2023, the Scottish population increased by 0.8 per cent, based entirely on inward migration. For the same period, the population of the UK as a whole increased by 1 per cent, so Scotland lags behind the overall UK growth by 20 per cent. In your view, why is the Scottish population growing less fast than that of the UK as a whole?

Thank you, convener. I do not know whether we have access to that data.

I am conscious of time, but I would like to ask another question. When you gave evidence to the committee in May, I asked you about the new deal for business and how it was progressing. At that point, you said that you were constrained in what you could say about it, because of the purdah rules. Can you give us an update on the status of the implementation of the 78 recommendations in the new deal for business?

We could debate that issue all morning. As an addition to those figures, it would be interesting to see a breakdown of the demography of the people who are leaving Scotland and those who are coming in. If it is the case that people in their 20s and 30s are leaving and that those who are coming in are in their 40s and 50s, that would also tell us something interesting. [Interruption.]

Thank you. I will change tack a little bit and ask you about a different subject. You have both referenced your hospitality inquiry, many of the recommendations in which involve voluntary action by employers. We have seen some regulation changes, and a law that has been introduced by the previous UK Government on passing on tips came into effect yesterday. There is precedent for Government bringing in legislation in this area. Much of what you are saying is about voluntary action by employers. How confident are you that employers will take up those recommendations, as opposed relying on further regulation?

Is there any reason why Scotland performs worse than other countries?

Good morning. I want to ask about skills, because I was very interested to see that, in your comparison, Scotland came last out of eight comparator countries in skills underutilisation. I take it that you are talking about people being overqualified for the job that they are doing. You would expect in such a tight labour market to see a maximisation of skills, but we are not seeing that. Can you explain a little bit why that situation is arising?

Thank you.

I will come to Scottish Enterprise in a minute, but first I have one more question for SNIB. I noticed that, according to the accounts, in 2023-24, which was the most recent financial year, you spent £96,000 on contracting with a public relations firm. What was that for?